Owner of Bitcoin drug market solicited a murder for hire, government alleges

October 2, 2013

The digital currency Bitcoin was a popular payment method on the now-closed online illicit marketplace Silk Road — and the complaint mentions the currency being used for a possible "murder-for-hire" by the site's alleged founder. (Jim Urquhart/Reuters)

The federal government has indicted a San Francisco man, Ross William Ulbricht, alleging that he is Dread Pirate Roberts, founder of the online drug marketplace Silk Road.

According to the criminal complaint against Ulbricht, communications this spring "reveal at least one occasion when DPR [Ulbricht] solicited a murder-for-hire" of a Silk Road vendor attempting to extort him with a threat to release the identities of thousands of Silk Road users. The complaint suggests that Ulbricht paid the supposed hit-man approximately $150,000 to kill a Canadian man and received a picture purporting to be the deceased victim. However, Canadian authorities say they have no record of a murder victim matching the man described in the exchange.

The alleged target, known as "FriendlyChemist," sent Ulbright a series of messages starting in March 2013 saying he had the real names and addresses of vendors and customers that he obtained through hacking the computer of a larger Silk Road vendor. According to the complaint, FriendlyChemist threatened to publish them online unless he was given $500,000. The complaint says FriendlyChemist needed the money to pay off debts to another individual. Eventually, FriendlyChemist put Ulbricht in touch with FriendlyChemist's creditor, who went by the name "redandwhite."

Eventually, Ulbricht proposed an alternative strategy for dealing with FriendlyChemist to redandwhite: Ulbricht would pay redandwhite to kill him, according to the complaint.

In a message the complaint says was sent March 27, Ulbricht allegedly wrote them saying "In my eyes, FriendlyChemist is a liability and I wouldn't mind if he was executed. ... I'm not sure how much you already know about this guy but I have the following info and am waiting on getting his address." Ulbricht allegedly provided the information, including the name of someone in British Columbia he identified as FriendlyChemist. He noted that the target had a wife and three children, according to the complaint.

Meanwhile, FriendlyChemist reportedly sent Ulbricht an ultimatum saying he had "no choice" but to release the information within 72 hours. Several hours later, the complaint says, Ulbricht sent a message to redandwhite explicitly asking to put a bounty on [FriendlyChemist's] head and asking if he could name a price.

When redandwhite allegedly responded with a price of $150,000-300,000 depending on how "clean" of a hit he wanted, Ulbright responded by asking if he could do better and claiming "not long ago, I had a clean hit done for $80K."

According to the complaint, redandwhite confirmed receiving a payment of around $150,000 in Bitcoins on March 31. Within 24 hours, Ulbricht allegedly received a message from redandwhite stating that "your problem has been taken care of." A few days later, Ulbricht allegedly sent a message that he had received a picture of the deceased victim and deleted it. However, the complaint says Canadian law enforcement have no record of "any Canadian resident" with the name mentioned in the exchange or a record of a homicide in the area around the time and place of the supposed hit.

Andrea Peterson covers technology policy for The Washington Post, with an emphasis on cybersecurity, consumer privacy, transparency, surveillance and open government.
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