|
 Jury selection is scheduled for Tuesday in Manhattan federal court
in the case of Ross Ulbricht, who authorities say created Silk Road,
an online black market where drugs and others illegal goods could be
bought anonymously using bitcoins.
The trial, expected to run for up to six weeks, will cast a
spotlight on the dark side of virtual currencies and so-called
Darknet markets where illicit goods can be secretly bought.
Ulbricht, 30, has never conceded creating Silk Road and has pleaded
not guilty to seven counts including operating a continuing criminal
enterprise and conspiracy to commit narcotics trafficking.
Prosecutors say Ulbricht took extreme steps to protect Silk Road,
soliciting the murder of six people who posed a threat. No evidence
exists the murders were carried out.
The former Eagle Scout faces up to life in prison if convicted. His
supporters include bitcoin enthusiasts and libertarians, who call
the case an attack on Internet freedom.
 "It's not just about one man and one family, but it's something that
will impact law going into the 21st Century," Lyn Ulbricht, his
mother, told a libertarian gathering in June.
Joshua Dratel, his lawyer, declined comment.
'ECONOMIC SIMULATION'
Silk Road operated from at least January 2011 to October 2013,
authorities say, generating sales of $1.2 billion and commissions of
$80 million by the time the FBI seized it and arrested Ulbricht.
Prosecutors say Ulbricht ran it as the "Dread Pirate Roberts," an
alias borrowed from a character in the 1987 movie "The Princess
Bride." The website relied on the so-called Tor network, which lets
users communicate anonymously.
The website was created after Ulbricht, a Texas native with a
bachelor's degree in physics, left graduate studies at the
Pennsylvania State University in 2010.
On LinkedIn, Ulbricht wrote that his goals had "shifted" and he was
now "creating an economic simulation to give people a first-hand
experience of what it would be like to live in a world without the
systemic use of force."
Prosecutors say the "economic simulation" was Silk Road, which made
him rich: From his laptop, the government seized 144,336 bitcoins
that on Friday were worth $41.2 million.
[to top of second column] |
While Ulbricht was charged in a separate case in Maryland over an
alleged murder-for-hire plot, the New York indictment does not have
substantive charges regarding them. U.S. District Judge Katherine
Forrest, who is presiding over the case in Manhattan court, has said
she will allow prosecutors to present evidence on allegations
Ulbricht ordered killings to defend his business.
NEW MARKETS
While Silk Road's takedown marked a high point in efforts to disrupt
illegal Darknet market activity, law enforcement continues to
wrestle with it.
Similar websites have since emerged, and by December they had 78
percent more drug listings since Silk Road's seizure, according to
Internet safety nonprofit Digital Citizens Alliance.
Among the new websites was one under Silk Road's name, leading to
charges in November against alleged creator Blake Benthall amid a
broader U.S. and European seizure of dozens of websites.
Even then, the bust did not shutter larger websites like Evolution,
which unlike Silk Road also sells weapons and stolen credit cards,
the Digital Citizens Alliance says.
Manhattan U.S. Attorney Preet Bharara, whose office is prosecuting
Ulbricht, compared it to "a game of Whac-A-Mole" but said that did
not mean giving up.
"The best way to go about it is to keep at it," he said. "Ultimately
you have the deterrent effect, because people realize, 'We can't
change our ops enough not to get caught.'"
(Reporting by Nate Raymond in New York; Additional reporting by
Aruna Viswanatha in Washington; Editing by Noeleen Walder, David
Ingram and Andrew Hay)
[© 2014 Thomson Reuters. All rights
reserved.]
Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |
