Feds Seize Silk Road 2 in Major Dark Web Drug Bust

Silk Road 2.0 is a predecessor to the notorious online drug market place, the now defunct, Silk Road. It utilizes the services of Tor Anonymizer Network to let users use the service anonymously. With this anonymity came the business where anonymity is essential. So Silk Road became the destination to buy and sell drugs among other things like hacking tools and sex toys and medicines even. Silk Road used Bitcoins instead of cash, which is also considered to be one of the reason behind Bitcoin’s meteoric rise. The original was launched in 2011 after 6 months of development and shut down by FBI. The second version, the Silk Road 2.0t, was taken down just moments earlier by the Federal Bureau of Investigation in cooperation with various international investigating agencies.

A silky origin

Silk Road was founded in February 2011. The name “Silk Road” comes from a historical network of trade routes, started during the Han Dynasty (206 BC – 220 AD), between Europe, India, China, and many other countries on the Afro-Eurasian landmass. Silk Road was operated by “Dread Pirate Roberts” (named after the fictional character from The Princess Bride), who was known for espousing libertarian ideals and criticizing regulation. In June 2011, Gawker published an article about the site, which led to “Internet buzz” and an increase in website traffic. Once the site was known publicly, U.S. Senator Charles Schumer asked federal law enforcement authorities such as the DEA and Department of Justice to shut down the website.

Law enforcement authorities have since long tried to get the users of Silk Road to justice and invariably, fell short. Since the only things that tied these suspects to Silk Road was their aliases. The accounts had to be bought in an auction until Silk Road specified a fixed fee and then they could sell their produce on the site which ranged from drugs to even sex toys.

The Story

Ross William Ulbricht, the person allegedly behind the alias Dread Pirate Roberts was arrested by the FBI on October 2nd last year.  Considering the popularity that the site had gained, it was just a matter of time till copy cats spawned up to replace the void. Thus came Silk Road 2.0, the newer version of silk road which was developed with the intention of increasing anonymity and security to the shady users. The new owner took the precaution of distributing encrypted copies of the site’s source code to allow the site to be quickly recreated in the event of another shutdown. The site did suffer a DDoS attack in its preliminary days and was hacked once which led to Bitcoins being stolen. But it came back strong through it all.

The owner of Silk Road 2.0, identified as Blake Benthall, said after arrest that he only recently took over the reins of Silk Road 2.0. He was the second-in-command till the original admin of the website abandoned ship. The fact that 3 other admins were also arrested in the past year, was not comforting news. Using the name “Defcon,” Benthall allegedly stated on Dec. 28, 2013, that he had taken over Silk Road 2.0. “I intend to prove to you that leading this movement forward is my top priority in life, and that I will pour any time and energy necessarily into ensuring its success,” he allegedly wrote in an online forum. “While other admins may run away when calamities strike — I’m ready to fight right here alongside you.” From this point forward, Benthall controlled virtually every tiny aspect of Silk Road.

The Fall from grace

The popularity of Silk Road led to its downfall and the same was expected of Silk Road 2.0, it was just a matter of time. The FBI was already in pursuit of these underground drug lords for a long long time. “Let’s be clear – this Silk Road, in whatever form, is the road to prison,” Manhattan U.S. Attorney Preet Bharara, whose office is prosecuting both cases, said in a statement. Benthall was taken into custody in San Francisco on Wednesday, but is being charged in the Southern District of New York. The investigation was run by the New York FBI and the office of Homeland Security Investigations, which had an undercover agent who “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,” the release said.

At the time of arrest, it is believed that the website had about 150,000 users with revenue close to $8 million. The Feds used search warrants to gather email evidence against Benthall which will be used in his prosecution. Benthall, 26, is facing charges of conspiring to commit narcotics trafficking (which carries a mandatory minimum sentence of 10 years), conspiring to commit computer hacking, conspiring to traffic in fraudulent identification documents and money-laundering conspiracy.

The complaint also traces Benthall’s proceeds from his alleged management of the Silk Road 2?s bustling sales. Law enforcement officials found that he used a bitcoin exchange to cash out $273,626 between Silk Road 2?s creation in November of last year and October of this year. About $70,000 of that money went towards a down payment on a $127,000 Tesla Model S. Benthall is also accused of holding the pursestrings for the Silk Road 2?s employees: An undercover Homeland Security agent was paid $32,189 worth of bitcoin for work the agent officially did for the site. However this time there is no mention of seizure of bitcoins from this bust up.

However knowing the Tor and the demand for such sites world wide, it shouldnt be long before a Silk Road 3.0 emerges in same avatar or a changed name.  The cat and mouse between the FBI and the online drug peddlers continues in earnest.  The copy of the complaint filed by DA Preet Bharara’s office and signed by Timothy Howard, Asst. DA,  is given below