In an interview last month, the head of the infamous Silk Road website promised that it would never allow the sale of “anything that’s main purpose is to harm innocent people . . . For example . . . hitmen aren’t allowed.” Last week, he was arrested for [PDF] (among other things) ordering the deaths of two men.

Silk Road was set up [PDF] as “a sprawling black-market bazaar” dealing primarily in illicit substances. The site distributed hundreds of kilograms of illegal drugs (and other illicit goods and services) to well over a hundred thousand buyers, generating the “equivalent to roughly $1.2 billion in revenue and $79.8 million in commissions” over the course of two years. The site operated on, and was only accessible through, the underground Tor network. Tor is used to anonymize online browsing by encrypting users’ data and routing it through numerous proxy computers, hampering law enforcement’s surveillance and tracking efforts. Silk Road also only accepted Bitcoins, an unregulated online currency generated and verified by a series of mathematical equations.

Taking a cue from The Princess Bride, the name Dread Pirate Roberts was selected because (allegedly) the site had changed hands. (The assertion is not entertained in the complaint.) The FBI uncovered a less fanciful name: Ross William Ulbricht, a twenty-nine year old graduate of the University of Texas and University of Pennsylvania School of Materials Science and Engineering. (For all of you looking for networking opportunities, his Linkedin and Facebook accounts are still live.)

Some serious FBI sleuthing connected several of Ulbricht’s online pseudonyms to Silk Road and DPR, if only somewhat tenuously. At the same time, the FBI managed to narrow down the geographic location of DPR. In June 2013, Ulbricht lived near the internet café used by someone to log “into a server used to administer Silk Road website.” DPR frequently used or referred to Pacific Standard Time in his messages.

More concrete evidence was discovered during a routine border search: counterfeit identification documents with Ulbricht’s picture. Just prior to the purchase, DPR had posted on Silk Road that he needed new fake IDs. When questioned, Ulbricht stated that, hypothetically speaking, anyone could order IDs through a website called Silk Road.

Despite the FBI’s cyber-sleuthing, the inevitable movie will be based on the two hits Ulbricht allegedly ordered. According to the complaint filed in New York [PDF], Silk Road user “FriendlyChemist” tried to blackmail DPR. In the online exchange between DPR and FriendlyChemist’s suppliers, the UPenn grad (politely) stated he “would like to put a bounty on his head if it’s not too much trouble for you.” During the subsequent negotiations, DPR added, “[d]on’t want to be a pain here, but the price seems high. Not long ago, I had a clean hit done for $80k.” Soon after, the suppliers sent DPR a photo of the victim.

He may have been duped. Authorities have “no record of there being any Canadian resident with [FriendlyChemist’s legal] name . . . as the target of the solicited murder-for-hire. Nor do they have any record of a homicide occurring” in the city on that date.

While the public debated on social media whether DPR had actually ordered another hit, or had thrown out the eighty grand as a negotiation tactic, a superseding indictment [PDF] was unsealed.

Back in January, an undercover agent contacted DPR, looking to move several kilos of drugs. A staff member, The Employee (I assume the names will be better in the movie), responded with the address of a vendor — his own. Less than two weeks after delivery, DPR contacted the agent, indicating The Employee had stolen from Silk Road and was in police custody. He initially solicited torture to recover the Bitcoins, but relented to execution. DPR wrote he had “never killed a man or had one killed before, but it is the right move in this case” because he had “to assume he will sing.” The going rate was eighty thousand.

The agent staged the torture and execution. Seeing the photos, the UPenn graduate reported he was “a little disturbed, but [was] ok.” In his defense, Ulbricht was “pissed [he] had to kill him.”

Ultimately, the FBI seized the equivalent of $3.3 million USD from users of Silk Road. (In a sad twist of fate, as of October 4th, the FBI has not been able to access DPR’s personal account of about $80 million.) Four vendors were arrested in Britain hours after DPR’s arrest, two in Washington state, and one in Sweden.

On social media sites, former Silk Road users are apparently still reeling from the allegations. Some doubt the validity of the hits, stating it was a set-up or ordered by an employee, arguing: “DPR was a smart man, this was not him. There’s no way.” Some question the investigation itself, saying that the FBI “is fabricating the story that they didn’t compromise the TOR network in order to keep people believing that TOR is safe . . . which leads to more arrests (and a compelling argument against budget cuts).” Another simply states that “[t]he details don’t add up. We will have to wait for more information and confirmation of these really sketch ass court documents.”

To some, the downfall of Silk Road is also the downfall of the concept of violence-free drugs. A former user sadly remarks, “[w]ell according to allegations dpr was himself a violent criminal. If accusations are true, he has betrayed his own ideology and let us down. I hope it’s not true.” To others, it signals the emergence of order in the world of cybercrime. As the Director General of the National Crime Agency warned criminals: “the hidden internet isn’t hidden and your anonymous activity isn’t anonymous. We know where you are, what you are doing and we will catch you.”

Torrey Samson

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2 Responses to The War on Drugs Moves Online: The Silk Road Take-Down

  1. Torrey says:

    Well, there were already competitors (I think the largest one is named Atlantis). The FBI took down the largest online marketplace for drugs, but definitely not the only one. I’m curious if the FBI has actually hacked into Tor, which will probably lead to shutting down those competing sites.

  2. Kate says:

    It’s really interesting to hear more about the FBI investigation leading to the capture of DPR and downfall of the Silk Road. It was clearly a very sophisticated operation, which the feds are still having difficulty cracking (i.e. tirelessly trying to recover that $80M). It makes me wonder about the prospect of a copycat emerging, and filling the niche Silk Road left behind. I am curious to see the magnitude of the repercussions from this major online drug bust. Nice post!