Silk Road 'darknet' boss found guilty of running massive drug website

Kevin McCoy | USA TODAY

Show Caption Hide Caption Alleged silk road operator's parents speak out Ross Ulbricht’s mother Lyn and father Kirk speak after their son was convicted in the Silk Road case.

NEW YORK – Alleged Silk Road darknet mastermind Ross Ulbricht was convicted of drug conspiracy and other charges Wednesday for allegedly founding and running the drug-trafficking site that served as an underworld version of eBay for a worldwide network of dealers and users.

A jury of six women and six men returned the verdict after little more than three hours of deliberations, capping a more than three-week trial featuring evidence that Ulbricht used the online alias Dread Pirate Roberts to found and build Silk Road into a underworld bazaar for everything from heroin and cocaine to phony IDs and computer-hacking programs.

Ulbricht, 30, showed little emotion as the verdict was read. His mother, Lyn, and father, Kirk, each held a hand to their forehead as the jury forewoman pronounced their son guilty on all charges in a seven-count indictment.

U.S. District Court Judge Katherine Forrest, who presided over the trial, set a tentative sentencing date of May 15. Ulbricht faces a mandatory minimum of 20 years in prison and could face life behind bars for the convictions.

As the judge adjourned court, an Ulbricht supporter yelled out, "Ross is a hero!" A moment later, his family and friends called out, "We love you, Ross," as federal marshals led him away.

Ulbricht looked at them, waved, and then disappeared through a door as he was led back to a holding cell.

Outside the Manhattan federal courthouse afterward, Ulbricht's parents said he would likely appeal. Much of the defense team's evidence was improperly barred from being introduced at the trial, they said.

"When it's not an even playing field, it's not a fair trial," said Lyn Ulbricht. "If we don't have fair trials in this country, then we're all in trouble."

Asked about her son's reaction to the verdict, she said, "I'm sure it's not the best day he's ever had."

Manhattan U.S. Attorney Preet Bharara said the conviction and the government's seizure of millions of dollars in bitcoins, the electronic currency Silk Road operated on, "should send a clear message" that "the supposed anonymity of the dark web is not a protective shield from arrest and prosecution."

Prosecution evidence alleged that Ulbricht planned Silk Road as far back as 2009 and launched the site two years later by renting a house near his family's Austin home, where he raised hallucinogenic mushrooms for sale.

By 2011, Silk Road was open for business, with secrecy measures designed to make it difficult for anyone to identify the true identities of the marketplace's operator, buyers and sellers. The business used a computer routing system known as Tor that sent messages from the participants through multiple computer servers located in Iceland and elsewhere that were rented under false identities.

Silk Road also required its anonymous buyers to trade money for bitcoins and then use the electronic currency for all transactions. The site charged a percentage commission on each deal, generating a bitcoin stash for Ulbricht that prosecutors said was worth roughly $18 million at the time of his arrest.

Prosecutors told jurors that Ulbricht continued to administer Silk Road from the site's beginning until Oct. 1, 2013, the day that federal investigators arrested him in a San Francisco public library. Undercover agents staged a loud distraction that enabled them to grab his laptop before he could either log off or trigger an encryption program that protected his data.

At the time of the arrest, Ulbricht was operating under the log-in Dread Pirate Roberts — a name taken from The Princess Bride novel and movie. He was engaged in an online chat with an undercover investigator who had secretly infiltrated the site and posed as an administrator who aided the alleged mastermind.

The laptop yielded a trove of electronic evidence, including a personal journal, e-mails and other evidence that prosecutors used at trial to argue that Ulbricht ruled an operation responsible for more than $182 million in illegal drug sales.

The journal and e-mails dovetailed with Silk Road chats that showed Ulbricht commissioned what he believed to be a Hells Angels motorcycle club representative to execute several Silk Road users who either threatened to blackmail him or otherwise threatened the operation.

Prosecutors stipulated that law enforcement officials had no evidence any murders actually took place. However, Ulbricht still faces charges of attempted witness murder and using interstate commerce for commission of murder-for-hire in a Baltimore federal court case.

Ulbricht's defense team, however, contended he launched Silk Road as an "economic experiment" and soon turned the site over to others because it had become too "stressful."

Defense lawyer Joshua Dratel told jurors that Silk Road's real operators ultimately lured Ulbricht back to take the fall when they learned that federal investigators were targeting the site, its operators and others involved.

Dratel argued that the electronic evidence seized and analyzed by prosecutors had been manipulated by others specifically to implicate Ulbricht.

Contending that trial evidence proved Ulbricht had sold Silk Road, Dratel said, "One of the important principles in this case is that Dread Pirate Roberts and Ross Ulbricht cannot be the same person." But legal rulings in the case barred him from introducing some of the evidence he hoped would prove that claim to the jury.

As a result, defense evidence at trial largely rested on testimony from friends who described Ulbricht as non-violent and gentle.

"I think it's indicative of the limitations placed on the defense," Dratel said of the quick guilty verdict. "When you have a case that's so one-sided, that's the result."