Silk Road 2.0 shut down, operator arrested, charged
The United States Attorney for the Southern District of New York has announced today the arrest of Blake Benthall, a.k.a. “Defcon,” in connection with his operation and ownership of the Silk Road 2.0 website. The online drug bazaar was simultaneously seized and taken down by law enforcement.
According to the complaint unsealed on Thursday in Manhattan federal court:
Since about December 2013, Benthall has secretly owned and operated an underground website known as “Silk Road 2.0″—one of the most widely used criminal marketplaces on the Internet today.
The website has operated on the “Tor” network, a special network of computers on the Internet, distributed around the world, designed to conceal the true IP addresses of the computers on the network and thereby the identities of the network’s users.
Since its launch in November 2013, Silk Road 2.0 has been used by thousands of drug dealers and other unlawful vendors to distribute illegal drugs and other illicit goods and services to buyers throughout the world, as well as to launder millions of dollars generated by these unlawful transactions. As of September 2014, Silk Road 2.0 was generating sales of at least approximately $8 million per month and had approximately 150,000 active users.
Silk Road 2.0 was created in the wake of the Government’s October 2013 seizure of the website known as “Silk Road” and the arrest of its alleged owner and operator, Ross William Ulbricht, a.k.a. “Dread Pirate Roberts.”
In November 2013, approximately five weeks after the Government shut down Silk Road and arrested Ulbricht, Silk Road 2.0 was launched. Designed to fill the void left by the Government’s seizure of Silk Road, Silk Road 2.0 was virtually identical to the original Silk Road website in the way it appeared and functioned.
In particular, like its predecessor, Silk Road 2.0 operated exclusively on the “Tor” network and required all transactions to be paid for in Bitcoins in order to preserve its users’ anonymity and evade detection by law enforcement. Likewise, the offerings on Silk Road 2.0 consisted overwhelmingly of illegal drugs, which were openly advertised as such on the site.
As of October 17, 2014, Silk Road 2.0 had over 13,000 listings for controlled substances, including, among others, 1,783 listings for “Psychedelics,” 1,697 listings for “Ecstasy,” 1,707 listings for “Cannabis,” and 379 listings for “Opioids.” Besides illegal narcotics, other illicit goods and services were openly advertised for sale on Silk Road 2.0 as well, including fraudulent identification documents and computer-hacking tools and services.
When Silk Road 2.0 was launched, it was controlled for a short time by a co-conspirator using the same online moniker as that allegedly used by Ross Ulbricht in operating the original Silk Road website—”Dread Pirate Roberts.” In late December 2013, however, Benthall, using the moniker “Defcon,” took over administration of the site and has owned and operated it continuously since that time.
In that role, he has controlled and overseen all aspects of Silk Road 2.0, including, among other things: the computer infrastructure and programming code underlying the website; the terms of service and commission rates imposed on vendors and customers of the website; the small staff of online administrators and forum moderators who have assisted with the day-to-day operation of the website; and the massive profits generated from the operation of the illegal business.
During the Government’s investigation, which was conducted jointly by the FBI and Homeland Security Investigations (HSI), an HSI agent acting in an undercover capacity successfully infiltrated the support staff involved in the administration of the Silk Road 2.0 website, and was given access to private, restricted areas of the site reserved for Benthall and his administrative staff. By doing so, the agent was able to interact directly with Benthall throughout his operation of the website.
Benthall has been charged with one count of conspiring to commit narcotics trafficking, one count of conspiring to commit computer hacking, one count of conspiring to traffic in fraudulent identification documents, and one count of money laundering conspiracy.
Benthall’s identity was discovered when the FBI discovered the server hosting the website at the time, and it was registered with his personal email address (firstname.lastname@example.org).
For more details about the investigation and the operation, check out the unsealed criminal complaint.