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Mastermind Behind Online Black Marketplace Silk Road Busted in San Francisco

Silk Road Amazon for drugs

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Mastermind Behind Online Black Marketplace Silk Road Busted in San Francisco

Silk Road, the website known as the black market version of eBay, connected criminals to more than 100,000 customers around the world, dealing in illicit substances from LSD, MDMA, and prescription pills to countless varieties of cannabis and even black market goods such as forged documents. But the site is offline now, and the elusive mastermind behind it has been arrested.

Ross Ulbricht busted in San Francisco LibraryRoss Ulbricht, 29, is being accused in a criminal complaint of, among other things, soliciting a hit man to kill a Silk Road vendor who had threatened to reveal the identities of other users of the site. In a separate case, Ulbricht is accused of asking an undercover FBI agent to murder a former Silk Road employee whom Ulbricht was concerned would become a witness for the government, according to an indictment.

The website worked on the principle that everyone remained anonymous. Users could gain access to the network only through encrypted software designed to ensure anonymity. Instead of credit cards and PayPal, Silk Road utilized Bitcoins, a virtual currency, through transactions that were scrambled. Users provided only a name, which was usually fake, and an address to which packages would be sent.

According to the federal complaint, Ulbricht had recently moved from Austin, Tex., where he lived with his parents, to San Francisco, where he rented a room under an assumed name.

FBI agents confronted Ulbricht in a library in San Francisco last Tuesday and arrested him on money-laundering and narcotics charges. The FBI also obtained an image of Silk Road’s Web server, which showed that the site had sales revenue of more than 9.5 million bitcoins, worth approximately $1.2 billion today, though the total worth was probably less at the time of the sales, according to the complaint.

Investigators believe Ulbricht collected commissions of more than 600,000 bitcoins, valued at $80 million, which they are currently trying to gain access to. Authorities have so far seized 26,000 bitcoins, worth about $3.6 million, from escrow accounts into which Silk Road buyers deposited funds.

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