The FBI announced yesterday the alleged owner and operator of the infamous underground drug marketplace, Silk Road 2.0, has been detained.
Twenty-six year-old Blake Benthall – alias ‘Defcon’ – was arrested in San Francisco on several counts, including drug trafficking, computer hacking and money laundering. The hidden website has since been seized by U.S. and European authorities.
A press release by the FBI’s New York Field Office stated the criminal is suspected to operate Silk Road 2.0 following the site’s re-launch in November 2013, after its predecessor was shut down by law enforcement.
The site, referred to as “one of the most extensive, sophisticated and widely used criminal marketplaces on the Internet today, is believed to have enabled more than 100,000 people to buy and sell illegal drugs anonymously via the Internet.
“Following a very close business model to the first, as alleged, Blake Benthall ran a website on the Tor network facilitating supposedly anonymous deals of drugs and illegal services generating millions of dollars in monthly sales,” stated FBI Assistant Director-in-Charge George Venizelos.
Benthall was suspected of controlling and overseeing all aspects of the Silk Road 2.0, including the computers infrastructure and programming code, the terms of service and commission rates imposed on vendors and customers, the staff of online administrations and forum moderators, as well as the immense profits generated.
According to the complaint, the underground market was generating sales of at least eight million dollars per month, with approximately 150,000 active users as of September 2014.
During October, the marketplace consisted of more than 13,000 listings for controlled substances, such as psychedelics, ecstasy and cannabis. Apart from illegal narcotics, other illicit goods and services were openly advertised for sale, including fraudulent identification documents and hacking tools and services, read the complaint.
The underground site was capable of keeping cybercriminals cloaked by operating exclusively on the “Tor” network, concealing the true IP addresses – and identities – of users on the global network. Furthermore, all transactions on the site required crypto-currency Bitcoin payments, making it easier for users to preserve their anonymity.
“Although running through the Tor network might provide some levels of protection and anonymity, there are other methods available to investigators, which can be used to identify those involved in the creation of the site,” explained Tripwire security analyst Ken Westin.
The complaint against Benthall noted the federal investigation, conducted jointly by the FBI and HSI, revealed the Silk Road 2.0 server was being controlled and maintained using Benthall’s personal email address.
Additionally, it was reported that federal agents were able to track administering of the site to Benthall’s computer, as well as several large cash withdrawals using Bitcoin exchanges.
“TOR can help keep your internet connection anonymous, but can’t protect you from your own greed,” said Westin. “Cashing out Bitcoin and purchasing $127K luxury vehicles are great ways to identify yourself as a potential online drug kingpin.”
HSI Executive Associate Director Peter Edge stated, “HSI will continue to work in partnership with its federal and international law enforcement partners around the world to hold criminals who use anonymous Internet software for illegal activities who seek to hide behind the anonymity of the Internet to carry out illegal activities accountable for their actions.”
A copy of the complaint against Benthall: