Oct 27

Fresh Set Of Charges Laid Against Ross Ulbricht

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

Ross UlbrichtA verdict has been determined on Ross Ulbricht’s case. He will be facing life in prison as a result of his alleged operations on the internet drug lair called Silk Road, which is where both sellers and buyers were able to send soft and hard drugs across the globe. His initial indictment happened back in February of this year with four criminal charges including, criminal and money hacking conspiracy, drug trafficking, each of which he profusely continues to deny. On Friday the 22nd of August, he faced three new charges as the Silkroad Kingpin, including identity fraud and narcotics trafficking.

The US Government laid in a 17-page amended document introducing one count each for every narcotics distribution and trafficking through the virtual facet and his fraudulent act of providing false identification documents. His attorney Joshua Dratel, however, told CoinDesk how the new charges did not in any way modify the nature of evidence. According to the new seconding indictment, the drug charges happen to be in connection with at least a kilogram of heroin, 10 grams of LSD, 500 grams of meth and 5 kilograms of cocaine sold through Silk Road.

Bitcoin-APSince his October 2013 arrest, the FBI has seized over $33.6 million worth of Bitcoins from Ulbricht. The FBI claimed this amount of Bitcoins to have been proceeds stemming from the Silk Road operation. Early this month, Ulbricht argued in a memo that he was originally plotting on a portal called Underground Brokers, where people could buy and sell almost about anything anonymously. He claimed that he did not purposely create Silk Road for drug trafficking.

The indicted also called out the intrusion of the US authorities in trampling every bit of his digital privacy rights. Furthermore, the initial report on his drug trafficking operations triggered an ongoing investigation to every depth of his ESI (electronically stored information). It gave the authorities enough discretion to follow through the investigation.

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

Oct 27

Federal Judge In The Silk Road Trial Doxed By Hackers

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

katherineforrest_220An unidentified group of hackers allegedly doxed Judge Katherine B. Forrest, the federal judge in the Silk Road case, posted her personal information -including personal address and social security number- in The Hidden Wiki, a Tor service that allows anyone to publish anonymously. The group announced future releases of data pertaining to Judge Forrest’s close friends and family members, inviting others to send her a SWAT police team to her domicile, steal her identity and pursue other illegal actions against her.

free-ross-logo-200x200All individuals and groups affiliated with the Free Ross Ulbricht movement have denounced the action, noting that it will certainly do more harm than good to his cause. In fact, it has been claimed that the author/s of the dox may be agent provocateurs with an agenda to discredit Tor users in general, and the Free Ross Ulbricht movement in particular. It is still too soon to know which would be the implications of this action in the outcome of the Silk Road case and other cases, if any, but it is likely that new directives and measures will be implemented to further protect the identity of federal judges, law enforcement officials and other public servants online.

The posters of the dox claimed that Judge Forrest is playing her part in a government campaign to make BitCoin illegal, and is failing to administer justice in the Silk Road case. Acting against Ulbricht -charging him for money laundry-, and denying him a fair trade is, therefore, an act of conspiracy.

In any case, there has been a strong and unanimous rejection of the dox and the call for action against Katherine B. Forrest from other Hidden Wiki editorsand online communities involved in the developments of the Silkroad case and the Free Ross Ulbricht campaign.

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

Oct 24

The Catch-22 Predicament Of The Alleged Silk Road Mastermind

>> Click here to find the Silk Road URL and know how to get to the Silk Road 2.0 <<

US District Judge Katherine Forrest has declined to suppress the evidence the government is using against Ross William Ulbricht, the alleged Silkroad mastermind. This paves way for a federal trial that is set for 3rd November, 2014 in connection to the Silkroad website that once sold hacking tools and illicit drugs.

Screen-Shot-2014-02-04-at-3.58.31-PMThe judge’s decision sidestepped the contentious issue of whether the federal prosecutors violated Ross Ulbricht’s constitutional rights of unlawful search and seizure. According to Ross Ulbricht’s defense team, the FBI (Federal Bureau of Investigation) or even the NSA (National Security Agency) in some way managed to unlawfully gain access to the Silkroad severs in Iceland, this led to several search warrants of social networking and e-mail accounts the U.S government said belong to Ross Ulbricht.

The New York judge stated that it does not matter whether the U.S government unlawfully gained access to the Silkroad severs. This is because she ruled that Ross Ulbricht does not have a right to challenge the seizure of the Silkroad servers that eventually led to his arrest last year.

She ruled that whatever methods the government used to gain access to the evidence against Ross Ulbricht are beyond the purview of the court.

She said that as a result of Ross Ulbricht denying any connection to the Silkroad servers and having not demonstrated any association to them, he does not have a right to challenge the methods used by the government to seize the Silkroad servers. She added that Ulbricht would have been able to challenge the search if he had claimed to have a connection to the Silkroad servers. The government said that they did not need a warrant because the Silkroad servers were overseas.

404823-6bcaabd8-2d6f-11e3-8568-6d90cd61124dThe judge wrote that the requirement to establish a personal privacy interest may appear to place Ross Ulbricht in a catch-22: if the U.S government must substantiate any connection between him and Silkroad, asking him to admit such a connection to establish his standing, the seizures and searches in question could be deemed unfair. But as Ross Ulbricht surely knows, this isn’t the first court, nor is he the first defendant, to bring up such an issue.

She did, however, note that the sworn statement of a defendant in support of a motion to suppress PDF evidence generally cannot be used against him at trial. She said that this doesn’t insulate Ross Ulbricht from all risk. If he decided to take the witness stand to defend himself, his statement may nevertheless be used to impeach him.

Ross William Ulbricht is charged with 7 separate crimes that are related to the design, creation, administration, and operations of Silkroad. He is accused of facilitating anonymous transactions of hacking tools, narcotics and fake identification documents.

>> Click here to find the Silk Road URL and know how to get to the Silk Road 2.0 <<

Oct 22

The Migrations Of Online Black Market Users

>> Click here to find the Silkroad URL and know how to get to the Silkroad 2.0 <<

silk-road-interfaceInternet offers a safe, less violent and more ethical marketplace for unlawful substances according to its advocates. This is the reason Silk Road thrived. Agora Marketplace too seems to be thriving. Despite the constant fear of closures by government authorities, these cryptomarkets provide a wider variety of products, offer better customer care and give increased assurance to the socially conscious users that their products are traded fairly and are conflict free.

Silk Road was first launched in February 2011 as a TOR hidden portal that online users browse securely and anonymously without the risk of traffic monitoring. By March 2013, Silk Road was selling about 10,000 products most of which were drugs considered contraband in many jurisdictions. All transactions in Silk Road were conducted with bitcoins, a crypto currency that affords users some degree of anonymity. It was estimated that this portal facilitated $15 million worth of transactions annually. The site was however taken down in October 2013 by the FBI and its alleged creator, Ross William Ulbricht arrested and charged with drug trafficking, facilitating computer hacking, soliciting murder and money laundering.

agora_market_canabis (1)The demise of Silk Road did create a vacuum that was filled by Agora Marketplace. Agora was launched in 2013 and is only accessible to users who surf using anonymous TOR browsers. Since its inception, it already has more than 16,000 listings and looks to surpass the popularity of Silkroad’s latest incarnation dubbed Silk Road 2.0.

Despite this growth, the fear of closure is something dark net users and operators constantly live with. And because many users tend to aggregate around a single cryptomarket they call home; when this is closed they usually are left digital refugees. This state necessitates the need to migrate to other online spaces. Agora Marketplace’s growth for instance is attributed to the migration of users who remained digital destitute when the original Silk Road was busted. These users look out for a new market because they want a constant supply of their drugs and prefer to get these using non-violent ways that they also believe are almost ethically right.

>> Click here to find the Silkroad URL and know how to get to the Silkroad 2.0 <<

Oct 20

Even If The FBI Did Hack The Silk Road Without A Warrant, US Prosecutors Seemingly Consider It’s Perfectly Legal

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

The Department of Justice in October 2013 seized Silkroad in what could easily be history’s largest Internet drug bust and what the department itself termed as a victorious drug raid of massive proportions. Along with the bust came the arrest of the alleged owner, Ross William Ulbricht and seizure of about four million dollars’ worth of bitcoins. Part of this procedure however breached privacy laws as the FBI did not seek a warrant to hack into the overseas servers that hosted the TOR network Silkroad relied on for anonymity.

Screen-Shot-2013-10-02-at-6.44.27-PMThe pre-trial motion filed by Mr Ulbricht’s defense teamargues that the FBI hacked into Silk Road’s servers without obtaining appropriate warrants thereby violating Mr Ulbricht’s privacy. Silkroad had been on FBI’s radar since its inception in 2011. Undercover agents began buying drugs on the site then but marketplace is hosted on a Tor network and this obscures the users’ IP addresses and prevents both users and their transactions from being traced. The servers of the Tor network that provided Silkroad with anonymity and which were hacked by the FBI are located in Iceland.

article-2617122-1D7B3D7F00000578-926_634x476The case prosecutors however thinks the alleged mastermind of Silkroad cannot claim violation of privacy because he has not admitted owning the Icelandic server that hosted his alleged online black market. In failing to lay claims, the prosecution says that Mr Ulbricht has failed to prove that his fourth amendment and privacy rights were violated. The prosecution further adds that Mr Ulbricht’s acts of omission fail to prove that he indeed has privacy interests on the server in Iceland and any other items associated with Silkroad that were searched or seized. To establish privacy rights, the Silk Road’s mastermind needed to show he has personal privacy interests in the server or searched property and not just the affirmation that such searches led to Silk Road’s seizure and his arrest. Prosecution also stated that fourth amendment rights do not include searches conducted by foreign law outside the United States.

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

Oct 17

The Effect The Original Silk Road Seizure Had On Other Black Markets

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

According to the researchers studying online black markets, the number of listings for illegal products and services has actually gone up following the original Silk Road takedown (Silk road 2.0 is up and bigger than the original). At least one researcher believes this means the illegal trade will grow even more.

Screen-Shot-2013-10-02-at-6.44.27-PM

Almost all of these markets use Bitcoin. James Martin, author of a new book on the subject, suggests that Bitcoin was utterly critical to Silkroad’s development and the developments of cryptomarkets in general. Silkroad mastermind, Dread Pirate Roberts, acknowledged this, calling it one of the “pillars of Silk Road.”

Changes in the Market after the Bust

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In the 6-month period following the original Silk Road closure, new “dark markets” appeared and illegal goods listings grew considerably, according to researchers from the Digital Citizens Alliance.

The non-profit group found the number of drug listings on the largest dark markets nearly doubled in that 6 month period to 32,029, versus six months earlier when the original Silk Road was taken offline. The group’s report looked at listings from 11 of the currently operational black market sites, six of which had been newly launched: Silk Road 2.0, Agora, Evolution, White Rabbit Anonymous Marketplace, Outlaw Market, The Pirate Market, and more.

On the other hand, a 2012 paper from Carnegie Mellon University computer engineering professor, Nicolas Christin, suggests that around 1.35 million BTC passed through Silk Road from 2011 until 2012, meaning the market’s transactions made up about 4.5% of all BTC transactions. It is still not clear, according to Christin, what the impact of the market’s closure had on the Bitcoin economy as a whole.

Nevertheless, it seems fairly clear that online black markets are popular among drug dealers for a simple reason: despite the risk of an FBI raid, they’re still safer than doing business the conventional way. For those who sell drugs, law enforcement is only part of the risk — a much bigger risk is someone trying to kill them and steal their stash of drugs.

For these dealers, online black markets help remove the “systemic violence” inherent to the narcotics business. Dark market vendors do not need assistance from the organized criminal gangs which usually take care of security and distribution in exchange for protection money. Consumers similarly don’t have to deal with potentially violent gang members either.

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

Oct 15

Documents Filed In Silk Road Case Seem to Solidify The Parallel Construction Theory

>> Click here to find the Silk Road URL and know how to get to the Silk Road 2.0 <<

Lyn UlbrichtEver since the US government first claimed it found the Silkroad server using a “leaky CAPTCHA,” technical experts have raised doubts about whether this explanation is plausible. Attorneys for alleged Silroad mastermind Ross Ulbricht suggested that this was just a cover story, intended to hide the fact that the NSA found the Silkroad server rather than the FBI. They suggested the CAPTCHA story was an example of “parallel construction,” a law enforcement technique to conceal the true origin of evidence in criminal cases.

Technical documents recently filed by the FBI seem to solidify these theories. According to Brian Krebs (of Krebs on Security) and Robert Graham (of Errata Security) a close examination of these documents reveals that the FBI did something very different from what they originally claimed. Krebs quotes a researcher from Berkeley’s International Computer Science Institute pointing out a simple fact — where the FBI agents claim to have found the “leak” is not consistent with how the server was designed.

The Silkroad system was set up in a fairly complicated fashion. Silkroad had been set up with a split architecture, where traffic from the Tor network went to a front-end server. This server in turn made requests to a back-end server in Iceland. According to documents released by the government, the Icelandic Silkroad server (which is the one that was siezed) was designed so that it would refuse most types of requests from the larger iternet.

silk_road00

According to Weaver’s analysis, the Silkroad server would not have replied with a portion of a CAPTCHA image as the FBI agents in the Silk Road case claimed. It is much more likely that the FBI accessed the Silkroad server’s IP address directly and was given a generic PHP/MyAdmin page.

It is important to note that there was a misconfiguration in one or both of the Silkroad servers that did allow access to PHP files from all over the internet, so it is plausible the FBI received some data back when they put in the IP address.

According to Robert Graham’s analysis, the PHP/MyAdmin explanation fits. Log entries where FBI Agent Christopher Tarbell accessed the Silkroad server showed him accessing the PHP/MyAdmin pages and not the Silkroad login page. Therefore they are not consistent with the FBI’s original explanation. Also, inconsistent with the server’s configuration, they produced a “200 OK” response code instead of the “401 UNAUTHORIZED” error which Graham would have expected to see — this suggests the FBI knew the password or the server configuration had somehow changed.

Graham concludes that the NSA as a missing link in the Silk Road case makes sense. With the Silkroad back-end server located in Iceland, the fact that the system did not use encrypted communications between the two servers means the NSA could easily have captured the password — the NSA is legally allowed (under US law) to monitor traffic between foreign countries, including Iceland.

With respect to the Silkroad front-end server in Germany (which is also known to be monitored by the NSA), while it would have returned a “forbidden” error if accessed outside TOR, it would not have done this when accessing PHP files. Graham suggests there were technical methods the FBI could have used to find this server, such as scanning the whole Internet for SSL servers and looking for the word “Silkroad” in the returned web page.

Graham notes that the original declaration by FBI Agent Tarbell was “gibberish” and so vague that nearly any explanation could fit — vague enough that an NSA agent showing up at the FBI office and typing in the Silkroad server’s IP address could fit within the scenario.

>> Click here to find the Silk Road URL and know how to get to the Silk Road 2.0 <<

Oct 13

Mother Of Accused Silk Road Leader Remains Optimistic For Her Son’s Case

>> Click here to find the Silk Road URL and know how to get to the Silk Road 2.0 >>

Lyn Ulbricht, the mother of alleged Silk Road ringleader Ross William Ulbricht has a long and intense year. It is now one year since her son was arrested by federal agents at a San Francisco public library, imprisoned and paraded on newspapers and magazines as the alleged Silk Road mastermind.

One year later, Lyn is optimistic, sounds energetic at times and exhausted at others. She’s prone to long sighs but is from time to time open to laughter when talking about her life experiences, her son’s case and trial. The alleged Silk Road ringleader Ross Ulbricht’s trial is scheduled to start on 10th November at 500 Pearl Street, New York. It is then that the many months of legal back and forth, the motions and filings will come to an end. Her son will stand trial for crimes the United States government alleges that he committed while operating Silk Road, a now infamous black market website that earned millions from between 2011 and 2013, through Bitcoin – a digital currency that was at time largely unknown.

Lyn has said that the case has been an eye-opener to her and that she has been alarmed by the action taken by the government against Ross Ulbricht who she maintains has been accused unfairly of using the assumed name Dread Pirate Roberts to operate Silk Road.

While she says she hasn’t exactly been a fan of the government over the years, she’s been alarmed at the actions it has taken, Lyn talks passionately about her son’s case, the questions about how the FBI acquired the evidence that they allege shows that her son operated Silk Road and the latest FBI statements. She also talks passionately about the struggles of caring for her son who’s currently residing in the Federal Metropolitan Detention Center in Brooklyn, New York.

She hopes that her son’s case will not go to trial, that in spite of the bad breaks a miracle will occur and the case against her son will be dismissed at an evidentiary hearing.

Lyn views the case against her son as an example of the ever expanding power of the government and how one can easily be accused of a crime in the United States. She asserts that the Ross is proof of how the system works, of how a person who has not been convicted, doesn’t have any prior arrests and is non-violent can be imprisoned for a whole year without bail.

Lyn has taken an active interest in FreeRoss.org, visiting conferences and rallies, blogging updates in the case, tweeting photos of supporters, and castigating reporters on social media. FreeRoss.org indicates that to date the campaign has raised over $185,000 towards its $250,000 goal.

Lyn has said that she is quite grateful to the supporters of the FreeRoss.org campaign, particularly Ver who has donated $70,000. She said that she hopes to one day meet Ver, so that she could thank him personally.

Lyn maintains that her son needs a strong defense, especially given the magnitude of the case against him and the implications it will have in Internet law. She said that helping her son is now her main focus and that she has relocated with her husband Kirk, to the Northeast so that they could be closer to Ross.

>> Click here to find the Silk Road URL and know how to get to the Silk Road 2.0 >>

Oct 11

Bitcoin CEO Pleads Guilty To Allegations Related to Silk Road Drug Deals

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

Charlie Shrem, the CEO of a Bitcoin exchange company and a leading supporter of the virtual currency, pleaded guilty at a hearing in New York federal court to one account of aiding and abetting the operation of a money-transmitting business that wasn’t registered with the United States Treasury Department. His co-defendant Robert Faiella of Cape Coral, Florida, separately pleaded guilty to operating an unlicensed money transfer business.

Shrem said in court that he knew most of the business on Silkroad involved the purchasing and selling of illicit drugs and that he also knew that what he was doing was wrong.

Charlie Shrem and Robert Faiella had initially been charged in January with scheming to sell and launder $1 million in Bitcoins. They pleaded guilty to the federal charges as part of a deal struck with the prosecutors from the office of Manhattan United States Attorney Preet Bharara.

United States authorities shut down Silkroad on 2nd October 2013. However a new version of Silk Road was later launched. Shrem and Faiella were both arrested in January. Prosecutors said that they both sold over $1 million in Bitcoins to users of the Silkroad. The Silkroad operated on TOR, also known as The Onion Router, an internet site that routed the users of Silkroad through several computers to conceal their identities and locations. Sellers and buyers and on Silkroad did business in Bitcoin, a virtual currency that gave them another layer of anonymity.

Shrem is well known in the bitcoin community. He resigned from his position as the vice chairman of the Bitcoin Foundation, soon after he was arrested. He was previously the CEO of BitInstant, a Bitcoin exchange company. He was also BitInstant’s compliance officer, responsible for making sure that the company followed the law. Faiella had operated Bitcoin exchange on Silkroad from December 2011 until the website was shut down.

According to court documents, Shrem had processed transactions for Robert Faiella through BitInstant, in spite of knowing that the Bitcoins would in the end find their way to Silk Road, where they would be used by customers buy and sell illicit drugs on the Silkroad. The prosecutors stated that Shrem had even given Faiella a discount on high volume trades of Bitcoins that he purchased for Silkroad buyers.

As part of their plea deals, Shrem and Faiella agreed to forfeit $950,000 to the government. By taking a plea deal, Shrem has avoided going to trial on more serious federal charges of violations of the Bank Secrecy Act and money laundering, which carry more prison time. Sentencing was set for 20th January and they both face up to 5 years in prison.

>> Click here to find the Silkroad URL and know how to get to the Silk Road 2.0 <<

Oct 10

Comcast Supposedly Monitoring Tor Users And Banning Them

Click here to find the Silkroad URL and know how to get to the Silkroad 2.0

comcastAccording to at least two Comcast users, agents of the company recently contacted them and told them to quit using Tor — or face a ban from Comcast’s service. The reason, according to these users, Tor provides access to illegal sites such as Silkroad. Shortly after these reports surfaced, however, Comcast issued a statement denying they had threatened anyone for using Tor or Silkroad and saying Tor users were welcome at the company.

In other words, though it’s not clear whether Comcast went after Tor or Silkroad users in the past, it’s unlikely they will try and go after Tor or Silkroad users in the future.

The controversy began when someone posted in the Reddit /r/darknetmarkets forum (where people discuss markets like Silkroad) claiming they’d received a call from a Comcast agent. The agent supposedly told this person Tor was an illegal service, using it was against the Comcast Terms of Service, and provided access to illegal markets like Silkroad.

Silk_Road_Comcast

The user asked to speak with the manager and was told the manager wasn’t available, so he called Comcast back the following day. An agent named Kelly roughly confirmed the policy, saying people who try to cover their tracks are usually doing things that aren’t legal — again, assuming that all Tor users are Silkroad users.

A second report of similar treatment by Comcast agents was submitted directly to the Deep Dot Web darkweb news site, which covers Silkroad and similar markets.

temp_comcastThe implication of this policy is that Comcast actively monitors its users’ online activity to check whether they are following the Terms of Service. The Tor Project has previously listed Comcast as a “bad ISP” which is not Tor-friendly, though not because of any specific anti-Tor or anti- Silkroad policies — Tor’s objection is that the Comcast Acceptable Use policy forbids running proxies or servers.

Comcast, on the other hand, states they do not monitor specific accounts unless they are presented with a court order. Even then, according to Comcast, they would attempt to notify the affected user so they could hire a lawyer and deal directly with the judge.

Deep Dot Web notes that Comcast’s behavior in the “Dread Pirate Roberts” Silkroad case is strongly at odds with this claim. Comcast also actively monitors the internet usage of its customers as part of Comcast’s Six Strikes program.

Silk_road_torThis program has nothing to do with Tor or Silkroad, but rather focuses on copyright infringement. If Comcast catches its customers pirating copyrighted material, they receive an email from Comcast telling them to stop doing this. After a total of six such infractions their account may be terminated.

Comcast’s Statement

Two days after the Deep Dot Web report hit the internet; Comcast released a statement from its VP of Internet Services, Jason Livingood, denying many of the claims made by Deep Dot Web. According to Livingood, the idea that the company has “declared war” on Tor or Silkroad” is “totally inaccurate.”

SilkRoad JailLivingood states that Comcast is not asking users to discontinue using the Tor browser software or any other browser. The company has no policy against itor any other specific software, and customers can visit any website or use any app they like with their Comcast service.

Furthermore, Livingood’s statement claims that Comcast does not monitor customer software or web usage. The “chat room” evidence from the Deep Dot Web story is, in his eyes, not accurate. Instead, Comcast only investigates or discloses information about customer accounts when presented with a valid court order.

What’s more, the Deep Dot Web claim that Comcast terminates customers under the Six Strikes program is (according to Livingood) false — he calls it a voluntary, educational, and non-punitive program. He does not, however, deny monitoring internet activity under this program.

Click here to find the Silkroad URL and know how to get to the Silkroad 2.0