End of Silk Road: Simple Errors Tripped up "Largest" Internet Drug Market

Borderland Beat

 

Though not directly related to Mexican drug war news, none the less, it is an example of  technology meeting criminality and an element that will be used in the future.  In this case Ulbricht made a couple of dumb mistakes as he initiated his internet drug market, which resulted in his identity being discovered, but overall he developed a sophisticated operation in 13 countries.  In his 2 1/2 year run he managed sales topping 1.2 Billion USD. One wonders what took so long to shut the operation down, A Forbes magazine reporter wrote about the website and his pot transaction from the website in September and how he "got caught"...oh not by law enforcement..by a researcher.  Bitcoin stock took a dive after the bust,  but ultimately it could be a good thing for the company ...Paz, Chivis

 

Ross Ulbricht did some dumb stuff for an Internet criminal kingpin, if FBI allegations are true.

Ulbricht was arrested Tuesday at the Glen Park branch of the San Francisco Public Library and charged with narcotics trafficking conspiracy, computer hacking conspiracy and money laundering. He’s accused of running Silk Road, a so-called hidden website that supposedly allowed users to buy and sell drugs without fear of discovery.

The scheme was pretty shrewd in some respects. According to a criminal complaint, Ulbricht made the Silk Road website (silkroadvb5iz3r.onion, which has since been seized by the Justice Department) accessible only through Tor, a network of computers designed to conceal IP addresses, and its associated anonymizing browser. And he used the digital currency Bitcoin adding a “tumbler” that obscured the sources and destinations of payments.  

From February 2011 to July 2013, the complaint alleges, Silk Road did sales of 9,519,664 Bitcoins and collected commissions of 614,305 Bitcoins – equivalent to $1.2 billion and $79.8 million at current exchange rates. As of Sept. 23, the complaint alleges, there were nearly 13,000 listings for drugs on the site, as well as:

•159 listings under the category “Services” – including offerings of computer hacking targeting Facebook, Twitter and other social media, tutorials on hacking ATM machines, and a listing for a “HUGE Blackmarket Contact List” that included “Hitmen (10+ countries).”

•801 listings under “Digital goods” – including pirated media, hacked accounts at Amazon, Netflix and other online services, and plenty of malicious software to buy.

•169 listings under “Forgeries” for fake driver’s licenses, passports, Social Security cards and more.

So it was a going concern. But what tripped up its proprietor?

Ulbricht used his real name and gmail account in forum threads that appeared to be associated with setting up Silk Road, the FBI alleges.

Here’s what happened, according to the court documents:

In January 2011, someone using the name “altoid” posted in a forum at www.shroomery.org what appeared to be an attempt to publicize Silk Road. A similar post was made a couple days later at bitcointalk.org, also by a user called “altoid.”

Eight months later, on Oct. 11, 2011, someone calling themselves “altoid” posted on the Bitcoin Talk forum seeking an “IT pro in the Bitcoin community” to hire for a “venture backed Bitcoin startup company.” The complaint says the responses were to be sent to … wait for it … “rossulbricht at gmail dot com.”

From there, investigators found his Google+ profile, his LinkedIn profile and YouTube videos that he favorited. Many of the videos originated at the website of the “Mises Institute,” which bills itself as the “world center of the Austrian School of economics.” On that site, the FBI alleges, was a profile for “Ross Ulbricht.”

The criminal complaint alleges that Ulbricht is the “Dread Pirate Roberts” or DPR, the person running Silk Road. DPR’s user signature on Silk Road’s forums also included a link to the Mises Institute website, the FBI says. DPR cited the “Austrian Economic theory” and the works of economists associated with the Mises Institute as “providing the philosophical underpinnings for Silk Road,” it said.

An investigator said in court documents that he traced the IP address Ulbricht was using to log into his Google account to the address of a friend he was staying with in San Francisco. And someone who logged in to the Silk Road server did so through an Internet café on Laguna Street, less than 500 feet away from the friend’s address on Hickory Street, the investigator said.

Ulbricht also used his real name on stackoverflow.com, a computer programming forum. The FBI alleges that Ulbricht created an account there under his real name and gmail account, then posted a message that allegedly indicated he was “writing a customized computer code designed for a web server operating a Tor hidden service, such as Silk Road.” 

Ulbricht had an initial appearance in court Wednesday, and a bail hearing was set for Friday, The Associated Press reported.
Silk Road UlbrichtCriminalComplaint the largest internet drug trafficking operation


Silk Road Ulbricht Post Complaint Protective Order
 

Associated Press and NBC News