A man from Austin TX was charged this week with running the largest online, illegal drug market in the US, ordering a $150,000 hit on a person who threatened to expose the website, and for generating $1.2 billion in illegal sales online.
Agents with the FBI confirmed this week that Ross Ulbricht was arrested this week on various federal drug charges.
He is 29 years old and has a home in Tarrytown, near Austin, Texas.
The TX native was the subject of a two year FBI investigation, and also he was targeted by the IRS and the Department of Homeland Security. The investigations netted a 39 page complaint against him which charged him with the federal crimes of money laundering, narcotics trafficking and computer hacking.
Federal investigators state that Ulbricht was the mastermind behind one of the most sophisticated illegal online drug markets they have ever seen.
The website was hidden and was called the Silk Road. Federal agents have taken the site offline. It is thought that several thousand illegal drug dealers around the world were using the Silk Road to illegally sell drugs.
US federal agents state in the complaint that the illegal site used a type of online currency known as bitcoins. It is thought that Silk Road garnished a total of $1.2 billion in sales in only two years. It also is thought that Ulbricht made as much as $80 million in commissions in that time.
Screen shots from the site that were taken by the FBI show that everything was for sale from heroin to cocaine, marijuana, meth paste, GBL, oxycontin and Xanax. Ulbright also has been accused by investigators of selling weapons and computer hacking documents and software.
The FBI would not discuss the details of what caused them to investigate Ulbricht in 2011.
The federal complaint also states that Ulbricht paid a hit man $150,000 to kill someone who threatened to disclose the website and also the names of some of his customers.
The complaint alleges that Ulbricht, in negotiations with the hit man, stated that that price was rather high, and that he had a hit done recently for only $80,000.
Ulbricht claimed that his career in Austin was an an investment advisor and entrepreneur. The paperwork filed in court stated that Ulbricht also had a staff, but the FBI has not arrested anyone else at this time.
Another media story this week reported that US federal agents seized up to $28 million in bitcoins from Ulbricht. They stated that the 144,000 bitcoins were found on computer hardware that belonged to Ulbricht, who was known on the online site as Dread Pirate Roberts.
This media report added that since the site opened in 2011, Silk Road was also an online marketplace for counterfeiters and for those who needed hitmen.
The FBI reports that more than 900,000 registered users on the site bought and sold drugs with bitcoins. The seizures of the bitcoins were part of a civil action against the Silk Road site and Ulbricht.
Ulbricht’s attorney has not yet commented extensively on the case, but he has said in the past that Ulbricht is denying all charges.