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Operator of Silk Road 2.0 Website Charged in Manhattan Federal Court

289 points by pc 12y ago

chrisdevereux 12y ago
Anyone who knows more about tor than me care to explain how DNS works on onion sites? I assumed that it would be distributed in some sort of way that prevented this sort of thing from happening? Or does transferring ownership require the owner's credentials to be compromized?
- mschuster91 12y ago
  You seize the server running the tor software serving as entry-point for your hidden service and grab the private keypair in order to impersonate the hidden service. The .onion address is iirc a hash of the public key.
  - chrisdevereux 12y ago
    By entry-point, do you mean a server that you would typically own/rent, or some other server in the tor network that you would not normally control?
    - mschuster91 12y ago
      The first one. In an ideal world (tm) you have two physical servers srv0/1, both with full-disk encryption and some form of remote KVM. srv0 is connected to the internet on eth0 and to srv1 on eth1. Then you set up networking in a way that the only thing aside from absolute required services running on srv0 is your tor gateway, and no traffic from eth1 may pass through to eth0. On srv1 you set up the usual services, e.g. mysql, lighttpd and whatever you need hosted. Ideally, you keep srv0 and srv1 in different datacenters, if not even different countries.
crazypyro 12y ago
I think this is the money quote: "During the Government’s investigation, which was conducted jointly by the FBI and HSI, an HSI agent acting in an undercover capacity (the “HSI-UC”) successfully infiltrated the support staff involved in the administration of the Silk Road 2.0 website, and was given access to private, restricted areas of the site reserved for BENTHALL and his administrative staff. By doing so, the HSI-UC was able to interact directly with BENTHALL throughout his operation of the website." So I assume this means they were able to infiltrate the community and there was possibly no unauthorized break necessary on the actual technology stack. It does lead one to question how they drew the final line between Benthall and his online persona, unless the undercover agent was also given access to financial information or other personally identifiable info. Maybe they even placed a malicious program on the server to target Benthall after they had control of a support backend. Interesting to see if that is all that comes out....
- MrDrone 12y ago
  Its been hinted that they'll be busting other Tor marketplaces in the next day or so. I wonder if they were similarly infiltrated and what effect that will have on the community.
  - psykovsky 12y ago
    On the community I have no idea, but I imagine the next reincarnation of these type of markets will have to be managed by lone wolfs out of a cave in Afghanistan.
    - deleted 12y ago
      [deleted]
    - nyolfen 12y ago
      in all seriousness perhaps iranian hosts would be a viable route
      - duaneb 12y ago
andrewljohnson 12y ago
These guys should stop operating out of the US. They might last longer.
ChuckMcM 12y ago
Maybe the title should be, "FBI Announces Silk Road 3.0" :-) And I agree, folks seem to be running these things out of the US rather than out of say the Cayman islands or Belize where is it easier to level the playing field with respect to the authorities.
- eksith 12y ago
  I'm not so sure. There have been offshore gambling sites (sports, poker etc...) that have been shut down before with the cooperation of local authorities, although not always easily. They may see revenue for local industry as a nice plus, but not so nice as to risk the ire of the U.S. govt. In the end, your allies offshore may only be as loyal as the force they're willing to ignore. And your friends may only be as trustworthy as the information you choose to share with them. Edit: Link to that poker takedown news http://www.covers.com/articles/articles.aspx?theArt=234980 http://www.covers.com/articles/articles.aspx?theArt=234980
  - duaneb 12y ago
    With TOR, though, it's very easy to move servers quickly. Who wants to play a foreign game of 'whack a mole'? Authorities will tire quickly of complying with an endless game.,
    - noir_lord 12y ago
      > Authorities will tire quickly of complying with an endless game Oh I wish that was true but we are in our fourth? decade of the War on Drugs, Authorities don't care, they just hire more people at tax payer expense.
      - jessaustin 12y ago
        The never-ending nature of these "Wars On" is actually the main appeal of them for the lobbyists and their minions. What is better than cash this year? Cash every year until the Republic falls.
hackerboos 12y ago
A twitter and github account based in San Francisco with a similar name has been quiet for over a month. Interests include Bitcoin.
- MacsHeadroom 12y ago
  He posted on Instagram just 5 days ago http://instagram.com/blakeisblake http://instagram.com/blakeisblake
base698 12y ago
What does this mean in the wake of Prop 47?
- jtreminio 12y ago
  Absolutely nothing at all. Transporting, or aiding in transporting, drugs across state lines brings in the big guns.
- greensoap 12y ago
  Nothing. Prop 47 is a state measure for simple possession. This is conspiracy to traffic, interstate wire fraud, federal crimes prosecuted under federal statutes. Even if these were state charges Prop 47 didn't really change much (or anything) sentencing for sales.
  - msandford 12y ago
    Conspiracy to traffic? Doesn't seem like it. Is it something that makes trafficking easier? Sure. But who did the trafficking? The seller and the buyer. Wire fraud? If it's the sale of something illegal I don't think that suddenly makes it wire fraud. Further, he's not charged with that. The sale is still completed. It's an illegal sale, but not fraud. Fraud would be if someone said they were going to sell you cocaine and instead shipped you powdered sugar.
    - at-fates-hands 12y ago
      >> Conspiracy to traffic? Just in case you didn't know: http://en.wikipedia.org/wiki/Conspiracy_%28criminal%29 http://en.wikipedia.org/wiki/Conspiracy_%28criminal%29 Conspiracy law usually does not require proof of specific intent by the defendants to injure any specific person to establish an illegal agreement. Instead, usually the law requires only that the conspirators have agreed to engage in a certain illegal act. Clearly, there was an agreement set forth. The owner of SR2.0 took money in exchange for people selling their goods and services on his site. If the site had some kind of terms of the agreement, which sellers had to ok, then he's screwed. >> Wire fraud? http://definitions.uslegal.com/w/wire-fraud/ http://definitions.uslegal.com/w/wire-fraud/ The essential element to be proved is that the person knowingly and willfully devised or intended to devise a scheme to defraud; and that the use of the interstate wire communications facilities was closely related to the scheme because the person either wired something or caused it to be wired in interstate commerce in an attempt to execute or carry out the scheme. This means he knew what he was doing was illegal and the use of the internet to essentially launder his money is what they're going after. Not the sale of the narcotics, but the transfer of money for ill gotten gains, which defrauded the US Government of tax revenue.
unchocked 12y ago
"Benthall should have known that those who hide behind the keyboard will ultimately be found." What a weird tone...
- canjobear 12y ago
  "Let’s be clear—this Silk Road, in whatever form, is the road to prison."
- openssj 12y ago
  In which the purpose of the press release (and bust) is revealed: to threaten the public and make an example. The usual stuff you expect out of an upstanding agent of democracy.
  - JoeAltmaier 12y ago
    Well, the crime-committing public anyway.
  - krapp 12y ago
    Shame on the US government for threatening the public with the enforcement of its own laws.
    - openssj 12y ago
      That statement nonspecifically threatens anyone who "hides behind a keyboard". Also, this threat comes without any determination that the law has been broken; there has been no conviction. I have no problem with assurance that the law will be faithfully executed. This isn't that. This is inflicting fear to suppress people you disagree with. If only we had a buzzword for that.
      - tedunangst 12y ago
        This is assurance to the public that the law will be faithfully executed. They are assuring the public that the FBI is capable of investigating crimes even on the internet.
deleted 12y ago
[deleted]
kazazes 12y ago
I won't link to them directly, but his accounts on most social networks are not deactivated, are publicly viewable and all mention bitcoin in the bio. In the wake of DPR 1.0 I find this a bit hubristic.
- shitehawk 12y ago
  Most crimes are never solved. The criminal has to practically fall asleep in the getaway car.
  - logfromblammo 12y ago
    ...or to post a basis for reasonable suspicion on their social media accounts.
- danielki 12y ago
  That's not the worst of it - the criminal complaint mentions that the server was registered to the email address blake@benthall.net. If that's not a giant "hey, feds, come and get me", I don't know what is. It also mentions that most of the accounts (Bitcoin wallet and other) that he used were all under his real name.
  - waterlesscloud 12y ago
    It's enough to make you wonder if someone set him up. Did they have something conclusively linking him to the site in the real world?
  - the_ancient 12y ago
    yes and none of that can be faked at all.... People have never signed up for services with the wrong email address, I have never gotten confirmation emails for things I did not sign up for... no no that has never happened... /s
jim_dnaley 12y ago
They located Silk Road 2.0's server in an unspecified way, not directly related to their undercover agent on the support staff. Given that two other darknet markets (Black Market and Cloud9) have been shut down today, and they didn't specify how they located the SR2 server, it seems plausible that law enforcement have a vulnerability to locate servers over the Tor network. From the complaint: "In or about May 2014, the FBI identified a server located in a foreign country that was believed to be hosting the Silk Road 2.0 website at the time. On or about May 30, 2014, law enforcement personnel from that country imaged the Silk Road 2.0 Server and conducted a forensic analysis of it. Based on posts made to the SR2 Forum, complaining of service outages at the time the imaging was conducted, I know that once the Silk Road 2.0 server was taken offline for imaging, the Silk Road 2.0 websites went offline as well, thus confirming that the server was used to host the Silk Road 2.0 website."[1] Then, as a result of extremely poor OpSec (Benthall accessed the server directly, used his real email for registering the server), they got his IP's and, well, you know where it goes from there. 1. https://pdf.yt/d/RpyX9_xmapTkhmkb https://pdf.yt/d/RpyX9_xmapTkhmkb (Complaint)
- DNM_throwaway 12y ago
  Since the bigger markets (Evo and Agora) aren't down (as of yet) I think it's probably not a general vulnerability that works for every site. If it did I would assume they would go after the biggest markets too, not the smaller ones who were already mostly dead.
  - haakon 12y ago
    They could have located the servers, but not the administrators because they don't do stupid stuff like connect to their servers directly. Perhaps they're just waiting for the admins to make a mistake. Taking down the servers without arresting anyone just isn't the same.
    - acveilleux 12y ago
      The servers may also be located somewhere that is less friendly and will not image the server for them?
anonDNMuser 12y ago
According to dnstats.net 23 out of 33 markets are still up. If you are interested in the perspectives of those affected by this I would suggest visiting here: https://www.reddit.com/r/DarkNetMarkets/comments/2lhin9/onymous_mega_thread_upvote_for_visibility/ https://www.reddit.com/r/DarkNetMarkets/comments/2lhin9/onym...
lelf 12y ago
Quote from http://www.irishexaminer.com/breakingnews/ireland/gardai-seize-drugs-after-probe-into-darknet-drug-operation-650036.html http://www.irishexaminer.com/breakingnews/ireland/gardai-sei... An international day of action to disrupt global activity on the Darknet and remove certain websites and forums is to conclude within the next 24 hours under the FBI/Europol operation codenamed "Onymous".
- genev 12y ago
  Very impressed with the codename.
Estragon 12y ago
Why couldn't the FBI land this case by itself? What are the responsibilities and special investigative powers (if any) of "Homeland Security Investigations." How do they justify their existence independent of the FBI? Their webpage suggests they do almost exactly the same thing. http://www.ice.gov/hsi http://www.ice.gov/hsi
- mpyne 12y ago
  ICE is the agency that handles customs inspections, and presumably get called in for any type of smuggling of contraband that crosses national borders. It would make a lot of sense for the Federal government to have a single agency that investigates all computer-related crimes, but since that would make sense it will never happen. Instead each agency (FBI, US Secret Service, ICE, etc.) will investigate computer-related crimes that tie into their bailiwick, likely cooperating for cases that cross jurisdictional boundaries like this case did.
chatmasta 12y ago
What are the chances that the FBI set up a number of "copy-cat-silk-road" hidden services, immediately after seizing the original? That would provide them ample opportunity to 1) build a profile of everyone who used them, then 2) shut them down with an intimidating "sting," dampening the desire of potential copy-copy-cats.
- Estragon 12y ago
  If Blake Benthall actually does prison time, I'd say that's extremely unlikely... I suppose the FBI could have been behind the original setup and then sold it to him...
  - chatmasta 12y ago
    Or he's a government agent. After all, who's really verifying he a) exists, b) goes to jail? Ok, that's enough fearmongering paranoia for me today. See you tomorrow hacker news! :)
    - deleted 12y ago
      [deleted]
- revelation 12y ago
  Last I checked, the original Silkroad strongly enshrined PGP encrypted communication between seller & buyer into the way these marketplaces are run. So theres no gain for them, as they can't get to whoever is selling/buying. They would just be facilitating the sales.
- sah2ed 12y ago
  Actually, an undercover agent was invited to be part of the select list of "trusted" users from SR 1.0 to join SR 2.0 so there was no need for them to do this. The text has been copy-pasted in this comment [0]. The source is from item 28a on page 13 of the complaint[1]. [0] https://news.ycombinator.com/item?id=8568765 https://news.ycombinator.com/item?id=8568765 [1] https://pdf.yt/d/RpyX9_xmapTkhmkb https://pdf.yt/d/RpyX9_xmapTkhmkb
yourad_io 12y ago
I cannot imagine a way in which a single-server hidden service is safe from a global, active adversary like FBI, NSA & Friends. This [1] discusses passive analysis over time. Isn't it really easy to locate one if you can perform active attacks on the global infrastructure? (introduce latencies and/or break links temporarily) If your hidden service is served by a couple of mirrors on each continent, though... then maybe you're safe? edit: This is a genuine question, not a rhetorical one. Am I missing something? [1] http://www.onion-router.net/Publications/locating-hidden-servers.pdf http://www.onion-router.net/Publications/locating-hidden-ser...
- avn2109 12y ago
  Good point. Noises have been made for a long time that Tor is compromised given a sufficiently motivated adversary. For instance, [0], among many others. In light of those noises, my non-rhetorical question is this: Why would any Ulbright wannabe reside within the US DoJ's sphere of influence? Get thee to Russia, and quickly! And while you're at it, keep your hardware in some third, fourth, and fifth locations, neither American nor Slavic. [0] https://www.schneier.com/blog/archives/2013/08/has_tor_been_co.html https://www.schneier.com/blog/archives/2013/08/has_tor_been_...
  - yourad_io 12y ago
    > Why would any Ulbright wannabe reside within the US DoJ's sphere of influence? Get thee to Russia, and quickly! 100% agree with this. I imagine it is mostly that people never think they'll get caught - or they view the risk of getting caught as much lower than the benefit of not moving, in any case. Edit 1: To add: I think "people" also underestimate just how easy it is to get caught. Getting caught doesn't mean you're stupid, or inexperienced, or anything except that you slipped once. You forgot the proxy, once. You sent your personal pubkey your rather your darknet pubkey, once. It takes next to nothing at all to get caught. Edit 2: The link you posted was about a javascript 0day exploit in the Tor Browser Bundle. Implementation flaws will always be there, but if the theory is broken as well... My question is about if the tor protocol itself could theoretically shield a hidden service from a global, active adversary. Which I think it couldn't.
chatmasta 12y ago
How is the FBI going to handle an inevitably popular decentralized marketplace? Will they prosecute anyone who downloads the marketplace software onto their computer? All the pieces are in place for a true p2p marketplace. It doesn't exist yet, but it will soon. EDIT: I should read about OpenBazaar.
- jedunnigan 12y ago
  I think we will arrive at a future where it will no longer be legal to create such software. The FBI will then go after the developers of said platforms. Of course they will still go after the large sellers and such using traditional investigative techniques.
macrael 12y ago
"On or about October 7, 2013, the HSI-UC [the undercover agent] was invited to join a newly created discussion forum on the Tor network, concerning the potential creation of a replacement for the Silk Road 1.0 website. The next day, on or about October 8, 2013, the persons operating the forum gave the HSI-UC moderator privileges, enabling the HSI-UC to access areas of the forum available only to forum staff." They were compromised from day 1, before the 2.0 site had even launched. I wonder how they managed to be a trusted admin so quickly?
- deleted 12y ago
  [deleted]
- wmf 12y ago
  That sounds like the FBI had already infiltrated the Silk Road 1.0 community so they were invited into 2.0 at the beginning.
  - macrael 12y ago
    That might have the most chilling effect on a 3.0.
    - tedunangst 12y ago
      WANTED: rockstar programmer for new e-commerce startup. still in stealth mode, but think silk road with less php and more rails. bitcoin experience/enthusiasm a plus. message for details. no feds please.
      - ZeroFries 12y ago
        Better watch out, law enforcement isn't exactly known for their sense of humour.
        tedunangst 12y ago
        Don't worry, I'll be conducting interviews on the StartupBus. http://www.wired.com/2013/03/a-long-fast-road-to-the-next-big-thing-in-tech-dispatches-from-the-startupbus/ http://www.wired.com/2013/03/a-long-fast-road-to-the-next-bi... (check photo credits)
kyledrake 12y ago
Thank god, I was worried that my violent street gang was going to lose business.
zanny 12y ago
Good news for bitcoin though, all these hidden service seizures and the price has barely budged. It is actually up a bit since this morning.
- mikeyouse 12y ago
  I think "Good News for Bitcoin" should be attached to a little trademark icon every time the phrase is uttered.
deleted 12y ago
[deleted]
swartkrans 12y ago
Here's a recent image of the person charged from his instagram: http://instagram.com/p/uyqRk1CXWk/ http://instagram.com/p/uyqRk1CXWk/ Prophetic.
- Magi604 12y ago
  Oh my. Rocket Scientist at SpaceX? I think his career might be put on hold for a while.
  - adamnemecek 12y ago
    He's all about getting high.
batrat 12y ago
So what? 100 more will arise. And this time not US based. You close 1 100 more will appear.
- wpietri 12y ago
  Marketplaces work much better at scale. And entrepreneurs do better the more they are connected with their markets. So from the government perspective, 100 kittens is way better than 1 lion. The government doesn't have to make these disappear. They just have to increase the perceived risk and decrease their effectiveness until they're no better than buying on well-known corners or getting the phone number of that one friend's friend's friend. That's mainly because drug practical prohibition activity is about suppression, not elimination. But I think it's worth noting that cops get paid to fight crime, not defeat it. As a general rule, I expect long-lived organizations to act in ways that self-sustain.
  - kirsebaer 12y ago
    Drug prohibition is about police departments getting federal grant money based on how many arrests they have made, seizing property of people arrested for drug crimes, and getting bribes from large-scale dealers.
knd775 12y ago
Wow. The guy's social media accounts indicate that he is a rocket scientist at SpaceX.
- mikeyouse 12y ago
  Meh.. it looks like he was only there for 5 months and that he quit in March (presumably to work on SR2.0 full time).
  - feld 12y ago
    Unlike at SpaceX, at Silk Road 2.0 the sky is the limit
DevX101 12y ago
To anyone thinking about 3.0, just move to another country. Preferably one that likes to stick the finger to U.S. and extradition requests. Bring along some extra bitcoins for the local police though.
deleted 12y ago
[deleted]
theibgdeal 12y ago
1) It's obvious now that TOR or bitcoin has been compromised in some way shape or form, allowing government strong arm agencies to once again subvert US citizens privacy in order to catch a 'drug facilitator.' 2) I have never drank or taken drugs, but I respect the choice and liberty of another person to do so, whether that be the invasive and deadly alcoholic beverage or the noxious cancer causing cigarette, or even the cannabis that retarded pot-heads smoke. 3) Its a shame the governments, christians, jews, muslims, swahilis and everyone else can't do the same. 4) Thinking about it - having the drug trade on the internet, kept it out of the street. No kids were used to distribute it across schools. No one got robbed or beaten. No one got shot. That's more than you can say for the 'war on drugs' and it's fallout. How many trillions have been spent, and how many people have died because of it? How many non-violent potheads clog the prisons? *There are more people incarcerated in America, the home of the free, than there are in any other country in the world, apart from Seychiles... because the prison system has been privatized and again - people figured out how to make money by taking away the liberties of Americans. http://en.wikipedia.org/wiki/List_of_countries_by_incarceration_rate http://en.wikipedia.org/wiki/List_of_countries_by_incarcerat... 5) The drug trade had been around for a thousand years and it was never a problem until the FBI, CIA and various interested parties realized they could make money off of it.
- ChristianBundy 12y ago
  > retarded pot-heads Really?
  - boardstretcher 12y ago
    That's the part you have a problem with? Telling.
typedweb 12y ago
There are already movements to decentralize Silk Road type sites using P2P technology, like OpenBazaar: https://openbazaar.org/ https://openbazaar.org/.
anonbanker 12y ago
so, is everyone ready to ditch Tor for i2p yet?
- darkstar999 12y ago
  It wasn't a protocol issue/backdoor. It was social engineering.
  - anonbanker 12y ago
    Against an adversary tapping the entire network, i've already switched to I2P/Tahoe-LAFS for my private communication/file transferring. It's where Silk Road 3.0 should be located.
Caligula 12y ago
I think this may be his hn account. https://news.ycombinator.com/user?id=blakeeb https://news.ycombinator.com/user?id=blakeeb
- JTon 12y ago
  A software engineer at Space X [1] is also behind Silk Road 2.0? Crazy [1] https://news.ycombinator.com/item?id=7277371 https://news.ycombinator.com/item?id=7277371
  - throwawayornot 12y ago
    "when I look back I will clearly view the code I've written here to be way more important for humanity's progress than the code I've written for entrepreneurs' selfish attempts at billion dollar exits"
    - mikeyouse 12y ago
      Everyone should note that he worked at SpaceX for 5 months..
- mpyne 12y ago
  "Greed. It's terrifying how much it prevails in our startup culture." Good to know he managed to tone down that concern in time for him to drop cold hard cash on a Tesla once the dough from SR2 started rolling in.
imaginenore 12y ago
OpenBazaar. https://openbazaar.org/ https://openbazaar.org/
jrobertfox 12y ago
I actually had this guy interview me for a first round at SpaceX. Seemed nice enough and we chatted further. By the time I flew in for the onsite he had "left." Cool dude.
decisiveness 12y ago
I feel like this information might make some deviously smart individuals think they can get away with it by not screwing up where Benthall did.
- wmf 12y ago
  Like he probably thought he would't screw up the same way Ulbricht did?
  - decisiveness 12y ago
    Yup, but the one takeaway I get from these court documents is the FBI needs someone to make some bone headed mistakes in order to bring them to justice.
smsm42 12y ago
>>> and Peter Edge, Executive Associate Director of Homeland Security Investigations (“HSI”), I wonder how is it "Homeland Security". Looks like this confirms "Homeland Security" is completely coopted into War on Drugs. Not that after this: https://www.eff.org/deeplinks/2014/10/peekaboo-i-see-you-government-uses-authority-meant-terrorism-other-uses https://www.eff.org/deeplinks/2014/10/peekaboo-i-see-you-gov... there was any doubt, but basically every time they talk about doing something to fight terrorism, it's probably means drug enforcement.
- mpyne 12y ago
  ICE (Immigration and Customs Enforcement) is responsible for controlling the import of goods (such as counterfeit Dutch passports and ID cards, but probably including drugs too) into the country, and they're a part of DHS.
sisk 12y ago
Curious if anyone has any idea how he was facilitating this: https://github.com/blakeeb/private https://github.com/blakeeb/private

289 points by pc 12y ago

Anyone who knows more about tor than me care to explain how DNS works on onion sites? I assumed that it would be distributed in some sort of way that prevented this sort of thing from happening? Or does transferring ownership require the owner's credentials to be compromized?

mschuster91 12y ago
You seize the server running the tor software serving as entry-point for your hidden service and grab the private keypair in order to impersonate the hidden service. The .onion address is iirc a hash of the public key.
- chrisdevereux 12y ago
  By entry-point, do you mean a server that you would typically own/rent, or some other server in the tor network that you would not normally control?
  - mschuster91 12y ago
    The first one. In an ideal world (tm) you have two physical servers srv0/1, both with full-disk encryption and some form of remote KVM. srv0 is connected to the internet on eth0 and to srv1 on eth1. Then you set up networking in a way that the only thing aside from absolute required services running on srv0 is your tor gateway, and no traffic from eth1 may pass through to eth0. On srv1 you set up the usual services, e.g. mysql, lighttpd and whatever you need hosted. Ideally, you keep srv0 and srv1 in different datacenters, if not even different countries.

crazypyro 12y ago

I think this is the money quote: "During the Government’s investigation, which was conducted jointly by the FBI and HSI, an HSI agent acting in an undercover capacity (the “HSI-UC”) successfully infiltrated the support staff involved in the administration of the Silk Road 2.0 website, and was given access to private, restricted areas of the site reserved for BENTHALL and his administrative staff. By doing so, the HSI-UC was able to interact directly with BENTHALL throughout his operation of the website." So I assume this means they were able to infiltrate the community and there was possibly no unauthorized break necessary on the actual technology stack. It does lead one to question how they drew the final line between Benthall and his online persona, unless the undercover agent was also given access to financial information or other personally identifiable info. Maybe they even placed a malicious program on the server to target Benthall after they had control of a support backend. Interesting to see if that is all that comes out....

MrDrone 12y ago
Its been hinted that they'll be busting other Tor marketplaces in the next day or so. I wonder if they were similarly infiltrated and what effect that will have on the community.
- psykovsky 12y ago
  On the community I have no idea, but I imagine the next reincarnation of these type of markets will have to be managed by lone wolfs out of a cave in Afghanistan.
  - deleted 12y ago
    [deleted]
  - nyolfen 12y ago
    in all seriousness perhaps iranian hosts would be a viable route
    - duaneb 12y ago

andrewljohnson 12y ago

These guys should stop operating out of the US. They might last longer.

ChuckMcM 12y ago

Maybe the title should be, "FBI Announces Silk Road 3.0" :-) And I agree, folks seem to be running these things out of the US rather than out of say the Cayman islands or Belize where is it easier to level the playing field with respect to the authorities.

eksith 12y ago
I'm not so sure. There have been offshore gambling sites (sports, poker etc...) that have been shut down before with the cooperation of local authorities, although not always easily. They may see revenue for local industry as a nice plus, but not so nice as to risk the ire of the U.S. govt. In the end, your allies offshore may only be as loyal as the force they're willing to ignore. And your friends may only be as trustworthy as the information you choose to share with them. Edit: Link to that poker takedown news http://www.covers.com/articles/articles.aspx?theArt=234980 http://www.covers.com/articles/articles.aspx?theArt=234980
- duaneb 12y ago
  With TOR, though, it's very easy to move servers quickly. Who wants to play a foreign game of 'whack a mole'? Authorities will tire quickly of complying with an endless game.,
  - noir_lord 12y ago
    > Authorities will tire quickly of complying with an endless game Oh I wish that was true but we are in our fourth? decade of the War on Drugs, Authorities don't care, they just hire more people at tax payer expense.
    - jessaustin 12y ago
      The never-ending nature of these "Wars On" is actually the main appeal of them for the lobbyists and their minions. What is better than cash this year? Cash every year until the Republic falls.

hackerboos 12y ago

A twitter and github account based in San Francisco with a similar name has been quiet for over a month. Interests include Bitcoin.

MacsHeadroom 12y ago
He posted on Instagram just 5 days ago http://instagram.com/blakeisblake http://instagram.com/blakeisblake

base698 12y ago

What does this mean in the wake of Prop 47?

jtreminio 12y ago
Absolutely nothing at all. Transporting, or aiding in transporting, drugs across state lines brings in the big guns.
greensoap 12y ago
Nothing. Prop 47 is a state measure for simple possession. This is conspiracy to traffic, interstate wire fraud, federal crimes prosecuted under federal statutes. Even if these were state charges Prop 47 didn't really change much (or anything) sentencing for sales.
- msandford 12y ago
  Conspiracy to traffic? Doesn't seem like it. Is it something that makes trafficking easier? Sure. But who did the trafficking? The seller and the buyer. Wire fraud? If it's the sale of something illegal I don't think that suddenly makes it wire fraud. Further, he's not charged with that. The sale is still completed. It's an illegal sale, but not fraud. Fraud would be if someone said they were going to sell you cocaine and instead shipped you powdered sugar.
  - at-fates-hands 12y ago
    >> Conspiracy to traffic? Just in case you didn't know: http://en.wikipedia.org/wiki/Conspiracy_%28criminal%29 http://en.wikipedia.org/wiki/Conspiracy_%28criminal%29 Conspiracy law usually does not require proof of specific intent by the defendants to injure any specific person to establish an illegal agreement. Instead, usually the law requires only that the conspirators have agreed to engage in a certain illegal act. Clearly, there was an agreement set forth. The owner of SR2.0 took money in exchange for people selling their goods and services on his site. If the site had some kind of terms of the agreement, which sellers had to ok, then he's screwed. >> Wire fraud? http://definitions.uslegal.com/w/wire-fraud/ http://definitions.uslegal.com/w/wire-fraud/ The essential element to be proved is that the person knowingly and willfully devised or intended to devise a scheme to defraud; and that the use of the interstate wire communications facilities was closely related to the scheme because the person either wired something or caused it to be wired in interstate commerce in an attempt to execute or carry out the scheme. This means he knew what he was doing was illegal and the use of the internet to essentially launder his money is what they're going after. Not the sale of the narcotics, but the transfer of money for ill gotten gains, which defrauded the US Government of tax revenue.

unchocked 12y ago

"Benthall should have known that those who hide behind the keyboard will ultimately be found." What a weird tone...

canjobear 12y ago
"Let’s be clear—this Silk Road, in whatever form, is the road to prison."
openssj 12y ago
In which the purpose of the press release (and bust) is revealed: to threaten the public and make an example. The usual stuff you expect out of an upstanding agent of democracy.
- JoeAltmaier 12y ago
  Well, the crime-committing public anyway.
- krapp 12y ago
  Shame on the US government for threatening the public with the enforcement of its own laws.
  - openssj 12y ago
    That statement nonspecifically threatens anyone who "hides behind a keyboard". Also, this threat comes without any determination that the law has been broken; there has been no conviction. I have no problem with assurance that the law will be faithfully executed. This isn't that. This is inflicting fear to suppress people you disagree with. If only we had a buzzword for that.
    - tedunangst 12y ago
      This is assurance to the public that the law will be faithfully executed. They are assuring the public that the FBI is capable of investigating crimes even on the internet.

deleted 12y ago

[deleted]

kazazes 12y ago

I won't link to them directly, but his accounts on most social networks are not deactivated, are publicly viewable and all mention bitcoin in the bio. In the wake of DPR 1.0 I find this a bit hubristic.

shitehawk 12y ago
Most crimes are never solved. The criminal has to practically fall asleep in the getaway car.
- logfromblammo 12y ago
  ...or to post a basis for reasonable suspicion on their social media accounts.
danielki 12y ago
That's not the worst of it - the criminal complaint mentions that the server was registered to the email address blake@benthall.net. If that's not a giant "hey, feds, come and get me", I don't know what is. It also mentions that most of the accounts (Bitcoin wallet and other) that he used were all under his real name.
- waterlesscloud 12y ago
  It's enough to make you wonder if someone set him up. Did they have something conclusively linking him to the site in the real world?
- the_ancient 12y ago
  yes and none of that can be faked at all.... People have never signed up for services with the wrong email address, I have never gotten confirmation emails for things I did not sign up for... no no that has never happened... /s

jim_dnaley 12y ago

They located Silk Road 2.0's server in an unspecified way, not directly related to their undercover agent on the support staff. Given that two other darknet markets (Black Market and Cloud9) have been shut down today, and they didn't specify how they located the SR2 server, it seems plausible that law enforcement have a vulnerability to locate servers over the Tor network. From the complaint: "In or about May 2014, the FBI identified a server located in a foreign country that was believed to be hosting the Silk Road 2.0 website at the time. On or about May 30, 2014, law enforcement personnel from that country imaged the Silk Road 2.0 Server and conducted a forensic analysis of it. Based on posts made to the SR2 Forum, complaining of service outages at the time the imaging was conducted, I know that once the Silk Road 2.0 server was taken offline for imaging, the Silk Road 2.0 websites went offline as well, thus confirming that the server was used to host the Silk Road 2.0 website."[1] Then, as a result of extremely poor OpSec (Benthall accessed the server directly, used his real email for registering the server), they got his IP's and, well, you know where it goes from there. 1. https://pdf.yt/d/RpyX9_xmapTkhmkb https://pdf.yt/d/RpyX9_xmapTkhmkb (Complaint)

DNM_throwaway 12y ago
Since the bigger markets (Evo and Agora) aren't down (as of yet) I think it's probably not a general vulnerability that works for every site. If it did I would assume they would go after the biggest markets too, not the smaller ones who were already mostly dead.
- haakon 12y ago
  They could have located the servers, but not the administrators because they don't do stupid stuff like connect to their servers directly. Perhaps they're just waiting for the admins to make a mistake. Taking down the servers without arresting anyone just isn't the same.
  - acveilleux 12y ago
    The servers may also be located somewhere that is less friendly and will not image the server for them?

anonDNMuser 12y ago

According to dnstats.net 23 out of 33 markets are still up. If you are interested in the perspectives of those affected by this I would suggest visiting here: https://www.reddit.com/r/DarkNetMarkets/comments/2lhin9/onymous_mega_thread_upvote_for_visibility/ https://www.reddit.com/r/DarkNetMarkets/comments/2lhin9/onym...

lelf 12y ago

Quote from http://www.irishexaminer.com/breakingnews/ireland/gardai-seize-drugs-after-probe-into-darknet-drug-operation-650036.html http://www.irishexaminer.com/breakingnews/ireland/gardai-sei... An international day of action to disrupt global activity on the Darknet and remove certain websites and forums is to conclude within the next 24 hours under the FBI/Europol operation codenamed "Onymous".

genev 12y ago
Very impressed with the codename.

Estragon 12y ago

Why couldn't the FBI land this case by itself? What are the responsibilities and special investigative powers (if any) of "Homeland Security Investigations." How do they justify their existence independent of the FBI? Their webpage suggests they do almost exactly the same thing. http://www.ice.gov/hsi http://www.ice.gov/hsi

mpyne 12y ago
ICE is the agency that handles customs inspections, and presumably get called in for any type of smuggling of contraband that crosses national borders. It would make a lot of sense for the Federal government to have a single agency that investigates all computer-related crimes, but since that would make sense it will never happen. Instead each agency (FBI, US Secret Service, ICE, etc.) will investigate computer-related crimes that tie into their bailiwick, likely cooperating for cases that cross jurisdictional boundaries like this case did.

chatmasta 12y ago

What are the chances that the FBI set up a number of "copy-cat-silk-road" hidden services, immediately after seizing the original? That would provide them ample opportunity to 1) build a profile of everyone who used them, then 2) shut them down with an intimidating "sting," dampening the desire of potential copy-copy-cats.

Estragon 12y ago
If Blake Benthall actually does prison time, I'd say that's extremely unlikely... I suppose the FBI could have been behind the original setup and then sold it to him...
- chatmasta 12y ago
  Or he's a government agent. After all, who's really verifying he a) exists, b) goes to jail? Ok, that's enough fearmongering paranoia for me today. See you tomorrow hacker news! :)
  - deleted 12y ago
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revelation 12y ago
Last I checked, the original Silkroad strongly enshrined PGP encrypted communication between seller & buyer into the way these marketplaces are run. So theres no gain for them, as they can't get to whoever is selling/buying. They would just be facilitating the sales.
sah2ed 12y ago
Actually, an undercover agent was invited to be part of the select list of "trusted" users from SR 1.0 to join SR 2.0 so there was no need for them to do this. The text has been copy-pasted in this comment [0]. The source is from item 28a on page 13 of the complaint[1]. [0] https://news.ycombinator.com/item?id=8568765 https://news.ycombinator.com/item?id=8568765 [1] https://pdf.yt/d/RpyX9_xmapTkhmkb https://pdf.yt/d/RpyX9_xmapTkhmkb

yourad_io 12y ago

I cannot imagine a way in which a single-server hidden service is safe from a global, active adversary like FBI, NSA & Friends. This [1] discusses passive analysis over time. Isn't it really easy to locate one if you can perform active attacks on the global infrastructure? (introduce latencies and/or break links temporarily) If your hidden service is served by a couple of mirrors on each continent, though... then maybe you're safe? edit: This is a genuine question, not a rhetorical one. Am I missing something? [1] http://www.onion-router.net/Publications/locating-hidden-servers.pdf http://www.onion-router.net/Publications/locating-hidden-ser...

avn2109 12y ago
Good point. Noises have been made for a long time that Tor is compromised given a sufficiently motivated adversary. For instance, [0], among many others. In light of those noises, my non-rhetorical question is this: Why would any Ulbright wannabe reside within the US DoJ's sphere of influence? Get thee to Russia, and quickly! And while you're at it, keep your hardware in some third, fourth, and fifth locations, neither American nor Slavic. [0] https://www.schneier.com/blog/archives/2013/08/has_tor_been_co.html https://www.schneier.com/blog/archives/2013/08/has_tor_been_...
- yourad_io 12y ago
  > Why would any Ulbright wannabe reside within the US DoJ's sphere of influence? Get thee to Russia, and quickly! 100% agree with this. I imagine it is mostly that people never think they'll get caught - or they view the risk of getting caught as much lower than the benefit of not moving, in any case. Edit 1: To add: I think "people" also underestimate just how easy it is to get caught. Getting caught doesn't mean you're stupid, or inexperienced, or anything except that you slipped once. You forgot the proxy, once. You sent your personal pubkey your rather your darknet pubkey, once. It takes next to nothing at all to get caught. Edit 2: The link you posted was about a javascript 0day exploit in the Tor Browser Bundle. Implementation flaws will always be there, but if the theory is broken as well... My question is about if the tor protocol itself could theoretically shield a hidden service from a global, active adversary. Which I think it couldn't.

chatmasta 12y ago

How is the FBI going to handle an inevitably popular decentralized marketplace? Will they prosecute anyone who downloads the marketplace software onto their computer? All the pieces are in place for a true p2p marketplace. It doesn't exist yet, but it will soon. EDIT: I should read about OpenBazaar.

jedunnigan 12y ago
I think we will arrive at a future where it will no longer be legal to create such software. The FBI will then go after the developers of said platforms. Of course they will still go after the large sellers and such using traditional investigative techniques.

macrael 12y ago

"On or about October 7, 2013, the HSI-UC [the undercover agent] was invited to join a newly created discussion forum on the Tor network, concerning the potential creation of a replacement for the Silk Road 1.0 website. The next day, on or about October 8, 2013, the persons operating the forum gave the HSI-UC moderator privileges, enabling the HSI-UC to access areas of the forum available only to forum staff." They were compromised from day 1, before the 2.0 site had even launched. I wonder how they managed to be a trusted admin so quickly?

deleted 12y ago
[deleted]
wmf 12y ago
That sounds like the FBI had already infiltrated the Silk Road 1.0 community so they were invited into 2.0 at the beginning.
- macrael 12y ago
  That might have the most chilling effect on a 3.0.
  - tedunangst 12y ago
    WANTED: rockstar programmer for new e-commerce startup. still in stealth mode, but think silk road with less php and more rails. bitcoin experience/enthusiasm a plus. message for details. no feds please.
    - ZeroFries 12y ago
      Better watch out, law enforcement isn't exactly known for their sense of humour.
      - tedunangst 12y ago
        Don't worry, I'll be conducting interviews on the StartupBus. http://www.wired.com/2013/03/a-long-fast-road-to-the-next-big-thing-in-tech-dispatches-from-the-startupbus/ http://www.wired.com/2013/03/a-long-fast-road-to-the-next-bi... (check photo credits)

kyledrake 12y ago

Thank god, I was worried that my violent street gang was going to lose business.

zanny 12y ago

Good news for bitcoin though, all these hidden service seizures and the price has barely budged. It is actually up a bit since this morning.

mikeyouse 12y ago
I think "Good News for Bitcoin" should be attached to a little trademark icon every time the phrase is uttered.

deleted 12y ago

[deleted]

swartkrans 12y ago

Here's a recent image of the person charged from his instagram: http://instagram.com/p/uyqRk1CXWk/ http://instagram.com/p/uyqRk1CXWk/ Prophetic.

Magi604 12y ago
Oh my. Rocket Scientist at SpaceX? I think his career might be put on hold for a while.
- adamnemecek 12y ago
  He's all about getting high.

batrat 12y ago

So what? 100 more will arise. And this time not US based. You close 1 100 more will appear.

wpietri 12y ago
Marketplaces work much better at scale. And entrepreneurs do better the more they are connected with their markets. So from the government perspective, 100 kittens is way better than 1 lion. The government doesn't have to make these disappear. They just have to increase the perceived risk and decrease their effectiveness until they're no better than buying on well-known corners or getting the phone number of that one friend's friend's friend. That's mainly because drug practical prohibition activity is about suppression, not elimination. But I think it's worth noting that cops get paid to fight crime, not defeat it. As a general rule, I expect long-lived organizations to act in ways that self-sustain.
- kirsebaer 12y ago
  Drug prohibition is about police departments getting federal grant money based on how many arrests they have made, seizing property of people arrested for drug crimes, and getting bribes from large-scale dealers.

knd775 12y ago

Wow. The guy's social media accounts indicate that he is a rocket scientist at SpaceX.

mikeyouse 12y ago
Meh.. it looks like he was only there for 5 months and that he quit in March (presumably to work on SR2.0 full time).
- feld 12y ago
  Unlike at SpaceX, at Silk Road 2.0 the sky is the limit

DevX101 12y ago

To anyone thinking about 3.0, just move to another country. Preferably one that likes to stick the finger to U.S. and extradition requests. Bring along some extra bitcoins for the local police though.

deleted 12y ago

[deleted]

theibgdeal 12y ago

1) It's obvious now that TOR or bitcoin has been compromised in some way shape or form, allowing government strong arm agencies to once again subvert US citizens privacy in order to catch a 'drug facilitator.' 2) I have never drank or taken drugs, but I respect the choice and liberty of another person to do so, whether that be the invasive and deadly alcoholic beverage or the noxious cancer causing cigarette, or even the cannabis that retarded pot-heads smoke. 3) Its a shame the governments, christians, jews, muslims, swahilis and everyone else can't do the same. 4) Thinking about it - having the drug trade on the internet, kept it out of the street. No kids were used to distribute it across schools. No one got robbed or beaten. No one got shot. That's more than you can say for the 'war on drugs' and it's fallout. How many trillions have been spent, and how many people have died because of it? How many non-violent potheads clog the prisons? *There are more people incarcerated in America, the home of the free, than there are in any other country in the world, apart from Seychiles... because the prison system has been privatized and again - people figured out how to make money by taking away the liberties of Americans. http://en.wikipedia.org/wiki/List_of_countries_by_incarceration_rate http://en.wikipedia.org/wiki/List_of_countries_by_incarcerat... 5) The drug trade had been around for a thousand years and it was never a problem until the FBI, CIA and various interested parties realized they could make money off of it.

ChristianBundy 12y ago
> retarded pot-heads Really?
- boardstretcher 12y ago
  That's the part you have a problem with? Telling.

typedweb 12y ago

There are already movements to decentralize Silk Road type sites using P2P technology, like OpenBazaar: https://openbazaar.org/ https://openbazaar.org/.

anonbanker 12y ago

so, is everyone ready to ditch Tor for i2p yet?

darkstar999 12y ago
It wasn't a protocol issue/backdoor. It was social engineering.
- anonbanker 12y ago
  Against an adversary tapping the entire network, i've already switched to I2P/Tahoe-LAFS for my private communication/file transferring. It's where Silk Road 3.0 should be located.

Caligula 12y ago

I think this may be his hn account. https://news.ycombinator.com/user?id=blakeeb https://news.ycombinator.com/user?id=blakeeb

JTon 12y ago
A software engineer at Space X [1] is also behind Silk Road 2.0? Crazy [1] https://news.ycombinator.com/item?id=7277371 https://news.ycombinator.com/item?id=7277371
- throwawayornot 12y ago
  "when I look back I will clearly view the code I've written here to be way more important for humanity's progress than the code I've written for entrepreneurs' selfish attempts at billion dollar exits"
  - mikeyouse 12y ago
    Everyone should note that he worked at SpaceX for 5 months..
mpyne 12y ago
"Greed. It's terrifying how much it prevails in our startup culture." Good to know he managed to tone down that concern in time for him to drop cold hard cash on a Tesla once the dough from SR2 started rolling in.

imaginenore 12y ago

OpenBazaar. https://openbazaar.org/ https://openbazaar.org/

jrobertfox 12y ago

I actually had this guy interview me for a first round at SpaceX. Seemed nice enough and we chatted further. By the time I flew in for the onsite he had "left." Cool dude.

decisiveness 12y ago

I feel like this information might make some deviously smart individuals think they can get away with it by not screwing up where Benthall did.

wmf 12y ago
Like he probably thought he would't screw up the same way Ulbricht did?
- decisiveness 12y ago
  Yup, but the one takeaway I get from these court documents is the FBI needs someone to make some bone headed mistakes in order to bring them to justice.

smsm42 12y ago

>>> and Peter Edge, Executive Associate Director of Homeland Security Investigations (“HSI”), I wonder how is it "Homeland Security". Looks like this confirms "Homeland Security" is completely coopted into War on Drugs. Not that after this: https://www.eff.org/deeplinks/2014/10/peekaboo-i-see-you-government-uses-authority-meant-terrorism-other-uses https://www.eff.org/deeplinks/2014/10/peekaboo-i-see-you-gov... there was any doubt, but basically every time they talk about doing something to fight terrorism, it's probably means drug enforcement.

mpyne 12y ago
ICE (Immigration and Customs Enforcement) is responsible for controlling the import of goods (such as counterfeit Dutch passports and ID cards, but probably including drugs too) into the country, and they're a part of DHS.

sisk 12y ago

Curious if anyone has any idea how he was facilitating this: https://github.com/blakeeb/private https://github.com/blakeeb/private