Mastermind of online criminal bazaar arrested
Ulbricht is said to be the mastermind behind the Silk Road, where drugs, hit men and more could be bought.
SAN FRANCISCO - After two years of painstaking sleuthing, Federal Bureau of Investigation (FBI) cybercrime experts have arrested a 29-year-old said to be the shadowy mastermind behind the Silk Road, "the most sophisticated and extensive criminal marketplace on the Internet today".
The Silk Road - a virtual bazaar where buyers could find everything from heroin and hacking software to contact information for hit men in more than 10 different countries - is thought to be helmed by a figure who calls himself "Dread Pirate Roberts".
By the time the Silk Road was shut down this week, prosecutors say it had become the venue for as much as US$1 billion worth of illegal transactions.
Investigations came to a close on Tuesday, when FBI agents arrested Ross William Ulbricht at the Glen Park library in San Francisco, where he had gone to log onto a computer, according to a person briefed on the matter. He faces charges of conspiracy to commit narcotics trafficking, money laundering and computer-hacking in a New York federal court.
The drug conspiracy charge carries a potential life sentence and US$10 million fine, while the computer-hacking conspiracy and money laundering charges carry 10-year and 20-year sentences, respectively, and US$250,000 fines.
The arrest came after agents intercepted a parcel addressed to Ulbricht's apartment that contained nine counterfeit IDs, each in a different name, but all bearing Ulbricht's photograph.
The interception, in July this year, came ahead of an August interview in Forbes, allegedly with the secretive Dread Pirate Roberts, who said: "The highest levels of government are hunting me... I can't take any chances."
The genius of Silk Road's design and the reason it eluded the FBI's grasp for so long, was its impenetrability. The site was accessible only on a so-called Tor network, designed to conceal the true Internet address of computers using it. Its exclusive reliance on digital currency Bitcoin added another layer of protection for its buyer and sellers.
Hit by the scandal and an increasing uncertainty as to its own future, Bitcoin lost a third of its value after Ulbricht's arrest and has yet to fully recover.
Ulbricht is also charged in Maryland with ordering the torture and murder of an employee by an undercover agent over fears the employee would expose him.
BLOOMBERG, AGENCE FRANCE-PRESSE, ASSOCIATED PRESS
Two years of undercover investigation
JANUARY 2011: First mention of Silk Road appears on magic mushrooms website
shroomery.org. Someone with the username Altoid asks if anyone has tried Silk Road. Altoid posts a similar message on the forum
bitcointalk.org.
JUNE 2011: Two US senators write to the Attorney-General and Drug Enforcement Agency chief urging them to investigate Silk Road and shut down Bitcoin.
OCTOBER 2011: Altoid surfaces again on the Bitcoin forum, seeking an "IT pro" to help build a Bitcoin start-up company and directing potential job candidates to the Gmail account of someone named Ross Ulbricht.
NOVEMBER 2011: Special FBI agent Christopher Tarbell's undercover team makes more than 100 drug purchases from Silk Road vendors, including Ecstasy, cocaine and heroin.
APRIL 2012: An undercover federal agent in Maryland posing as a drug dealer, makes contact with Dread Pirate Roberts.
JANUARY 2013: The undercover agent completes the sale of cocaine to a Silk Road employee, who was later arrested.
JULY 10, 2013: Customs officials intercept a package from Canada addressed to an apartment on 15th Street in San Francisco. The package contains nine counterfeit IDs, each in a different name, but all featuring a photograph of the same person - Ulbricht.
TUESDAY - Ulbricht is arrested at Glen Park library in San Francisco.
BLOOMBERG, AGENCE FRANCE-PRESSE
