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Indictment in Silk Road case

Ross William Ulbricht was indicted Tuesday on charges that he operated the billion-dollar Silk Road website where customers used Bitcoins to buy and sell drugs.

The indictment for Ulbricht, 29, who authorities said was known by his Internet moniker "Dread Pirate Roberts," includes a new charge, of engaging in a "continuing criminal enterprise." The count carries a maximum life sentence and a mandatory minimum term of 20 years, said Preet Bharara, the U.S. attorney in Manhattan.

Ulbricht was also indicted on previous charges of conspiracy to commit computer hacking and conspiracy to launder money. In the indictment, the government extended the time frame of the narcotics conspiracy, saying it went from January 2011 to October 2013.

Ulbricht was arrested in October and charged with running "every aspect" of Silk Road, where anonymous users paid Bitcoin digital currency to purchase illegal drugs, malicious software designed for computer hackers and other illegal products, Bharara said. He is being held at the federal jail in Brooklyn. Prosecutors have said Ulbricht tried to arrange the slayings of six people to protect his business.

In December the U.S. charged three former employees with aiding the operation.

"Silk Road emerged as the most sophisticated and extensive criminal marketplace on the Internet, serving as a sprawling black-market bazaar where unlawful goods and services, including illegal drugs of virtually all varieties, were bought and sold," Bharara said in a statement.

Illegal drugs were openly advertised on the site under categories such as cannabis, ecstasy, opioids, prescription drugs and stimulants, Bharara said. Law enforcement agents made more than 100 undercover purchases of heroin, cocaine, ecstasy and LSD, he said.

Ulbricht tried to make those transactions anonymous, first by using "The Onion Router" or "Tor" network of computers designed to conceal the true IP address and identity of the network's users, according to prosecutors in Bharara's office.

Ulbricht designed Silk Road to include a Bitcoin-based payment system to conceal the identities and locations of the users, according to the indictment.

A lawyer for Ulbricht, Joshua Dratel, said his client would plead not guilty at an arraignment scheduled for Friday.

Copyright © 2015, Los Angeles Times
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