FBI shuts down online black market

US authorities said Wednesday that they have busted an online black market for drugs, hitmen, hacker tools and more, arresting the suspected mastermind of a nefarious bazaar called Silk Road.

Ross William Ulbricht, also known as “Dread Pirate Roberts,” was arrested on Tuesday in San Francisco after the website was shut down, the Justice Department said in a statement.

His online moniker appeared to be taken from a character in the film “The Princess Bride.”

Prosecutors said they seized approximately $3.6m worth of Bitcoins, the largest-ever seizure of the digital currency.

“The Silk Road website has served as a sprawling black market bazaar where illegal drugs and other illicit goods and services have been regularly bought and sold by the site’s users,” FBI Special Agent Christopher Tarbell said in a criminal complaint filed in federal court.

From about January 2011, Ulbricht ran a marketplace that hawked heroin, cocaine, LSD and methamphetamine, as well as hacker tools such as software for stealing passwords or logging keystrokes on people’s machines, according to court documents.

‘Extensive criminal marketplace’

Prosecutors also charged that in March, Ulbricht tried to hire someone to kill a Silk Road user who threatened to expose the identities of others using the website.

“The defendant deliberately set out to establish an online criminal marketplace outside the reach of law enforcement and government regulation,” Tarbell said in the legal filing.

Ulbricht, 29, anonymized Silk Road transactions by using a Tor computer network designed to make it almost impossible to locate computers used to host or access websites.

“Silk Road has emerged as the most sophisticated and extensive criminal marketplace on the Internet today,” the criminal complaint contended.

“The site has sought to make conducting illegal transactions as easy and frictionless as shopping online at mainstream e-commerce websites.”

Prosecutors maintained that Silk Road has been used by thousands of drug dealers to distribute hundreds of kilograms of illegal wares to more than 100,000 buyers and to launder hundreds of millions of dollars in ill-gotten profits.

Silk Road took in commissions ranging from eight to 15 percent of sales, raking in at least $80m on more than $1.2bn worth of transactions, the criminal complaint estimated.