Alleged operator of Silk Road 2.0 arrested, faces narcotics charges

The 26-year-old was arrested Wednesday in San Francisco and faces multiple charges in New York

The alleged operator of Silk Road 2.0, a website used to sell illegal drugs, computer-hacking tools and fraudulent identification documents, has been arrested and will face charges in a U.S. court.

Blake Benthall, 26, was arrested Wednesday in San Francisco and will appear in court today, the U.S. Department of Justice said in a press release. Benthall has allegedly operated Silk Road 2.0 since December 2013, after U.S. law enforcement officials shut down the original Silk Road just weeks earlier.

The second version of Silk Road was "a nearly identical criminal enterprise" to the first version, Preet Bharara, U.S Attorney for the Southern District of New York, said in a statement.

"Let's be clear -- this Silk Road, in whatever form, is the road to prison," added Bharara, whose office was among the law enforcement agencies investing the website. "Those looking to follow in the footsteps of alleged cybercriminals should understand that we will return as many times as necessary to shut down noxious online criminal bazaars. We don't get tired."

Since late 2013, Benthall, also known as Defcon, operated Silk Road 2.0 on the anonymous Tor network, according to a complaint unsealed Thursday in U.S. District Court for the Southern District of New York.

"Thousands" of drug dealers used the site to distribute hundreds of kilograms of illegal drugs around the world, the DOJ alleges. Criminals also used the site to launder millions of dollars, according to the complaint.

As of September, Silk Road 2.0 was generating sales of about $8 million a month and had about 150,000 active users, the complaint said.

The second version of Silk Road launched just weeks after the DOJ's October 2013 seizure of the original Silk Road and the arrest of its alleged owner and operator, Ross William Ulbricht, known as Dread Pirate Roberts. A trial for Ulbricht in New York is scheduled for early 2015.

Silk Road 2.0 was virtually identical to the original Silk Road website, the DOJ said.

Like its predecessor, Silk Road 2.0 operated exclusively on the Tor network and required all transactions to be paid for in Bitcoins in an effort to preserve its users' anonymity and evade detection by law enforcement. Most of the products sold on Silk Road 2.0 were illegal drugs, the DOJ alleged, with more than 13,000 listings for controlled substances on Oct. 17.

The listings then included 1,783 for psychedelics, 1,697 listings for ecstasy, 1,707 listings for cannabis, and 379 listings for opioids, the DOJ said.

When Silk Road 2.0 launched in November 2013, it was controlled for a short time by a co-conspirator calling himself Dread Pirate Roberts, the same online moniker allegedly used by Ulbricht in operating the original Silk Road. In late December 2013, Benthall took over administration of the site and has owned and operated it continuously since that time, the DOJ alleged.

Benthall, a resident of San Francisco, is charged with one count of conspiring to commit narcotics trafficking, which carries a maximum sentence of life in prison and a mandatory minimum sentence of 10 years. He also faces charges of one count of conspiring to commit computer hacking, which carries a maximum sentence of five years in prison; one count of conspiring to traffic in fraudulent identification documents, 15 years in prison; and one count of money laundering conspiracy, 20 years in prison.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's email address is grant_gross@idg.com.

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