Feds Arrest Alleged Top Silk Road Drug Seller
https://krebsonsecurity.com/2013/10/feds-arrest-alleged-top-silk-road-drug-s... Feds Arrest Alleged Top Silk Road Drug Seller Federal authorities last week arrested a Washington state man accused of being one of the most active and sought-after drug dealers on the online black market known as the “Silk Road.” Meanwhile, new details about the recent coordinated takedown of the Silk Road became public, as other former buyers and sellers on the fraud bazaar pondered who might be next and whether competing online drug markets will move in to fill the void. NOD's feedback from Silk Road buyers, according to the government. A complaint unsealed Oct. 2 by the U.S. District Court for the Western District of Washington at Seattle alleges that Steven Lloyd Sadler, 40, of Bellevue, Wash., used the nickname “NOD” on the Silk Road, and was among the “top one percent of sellers” on the Silk Road, selling high-quality cocaine, heroin and methamphetamine in small, individual-use amounts to hundreds of buyers around the world. Investigators with the FBI and U.S. Post Office inspectors say they tracked dozens of packages containing drugs allegedly shipped by Sadler and a woman who was living with him at the time of his arrest. Authorities tied Sadler to the Silk Road after intercepting a package of cocaine and heroin destined for an Alaskan resident. That resident agreed to cooperate with authorities in the hopes of reducing his own sentence, and said he’d purchased the drugs from NOD via the Silk Road. Agents in Seattle sought and were granted permission to place GPS tracking devices on Sadler’s car and that of his roommate, Jenna White, also charged in this case. Investigators allege that the tracking showed the two traveled to at least 38 post offices in the Seattle area during the surveillance period. Interestingly, the investigators used the feedback on NOD’s Silk Road seller profile to get a sense of the volume of drugs he sold. Much like eBay sellers, merchants on the Silk Road are evaluated by previous buyers, who are encouraged to leave feedback about the quality of the seller’s goods and services. According to the government, NOD had 1,400 reviews for individual sales/purchases of small amounts of drugs, including: 2,269.5 grams of cocaine, 593 grams of heroin and 105 grams of meth. The complaint notes that these amounts don’t count sales going back more than five months prior to the investigation, when NOD first created his Silk Road vendor account. Cryptome has published a copy of the complaint (PDF) against Sadler. A copy of Sadler’s case docket is here. NOD’s reputation on the Silk Road also was discussed for several months on this Reddit thread. Many readers of last week’s story on the Silk Road takedown have been asking what is known about the locations of the Silk Road servers that were copied by the FBI. It’s still unclear how agents gained access to those servers, but a civil forfeiture complaint released by the Justice Department shows that they were aware of five, geographically dispersed servers that were supporting the Silk Road, either by directly hosting the site and/or hosting the Bitcoin wallets that the Silk Road maintains for buyers and sellers. Two of those servers were located in Iceland, one in Latvia, another in Switzerland, and apparently one in the United States. See the map above. As if the subset of Bitcoin users who frequented the Silk Road already didn’t have enough to worry about, there are indications that the individual(s) responsible for creating a competing Tor-based drug market — SheepMarketplace — may have made some missteps that could make it easier for authorities to discover the true location of that fraud bazaar as well. Check out this Reddit thread for more on that. Also, there are some indications that a Silk Road 2.0 is in the works, at least according to DailyGadgetry.com. If that doesn’t work out, perhaps would-be future Dread Pirate Robertses will turn to Bitwasp, a budding Github project which aims to provide open source code for setting up standalone markets using Bitcoin. “I think what you’re going to see is that a lot of me-too communities spring up and get squished pretty quickly,” said Nicholas Weaver, a researcher at the International Computer Science Institute (ICSI) and at University of California San Diego. “Part of the reason why the Silk Road was so useful was that it was so popular, and a half dozen smaller markets could be far less efficient than these larger markets. But personally, I’m betting we’ll soon see a fair number of them.” Finally, it seems a large number of Bitcoin users have been spending tiny fractions of their coinage to send messages to the FBI’s Bitcoin address on Blockchain. Some of the love letters to the FBI are amusing, such as, “All your Bitcoins are belong to us,” while others sound a defiant tone, including this one: ”One star is born as another fades away. Which one will come next? is my favorite riddle.” Said a girl puffing rings in a dot, dot, dash haze. “No worry, No hurry. They can’t stop the signal.” Update, Oct. 8, 2013: The BBC is reporting that four men have been arrested in the U.K. for alleged drug offenses on the Silk Road, and that more arrests are expected in the coming weeks. The BBC quotes the U.K. National Crime Agency as saying such sites would are a “key priority.”
So the obvious question not getting much coverage in the mainstream press: How much domestic work is the Fort doing to carry the FBI's baggage in these recent cases? Is it legal? Separately: I seem to recall a story a few years back about the Fort helping the Feebees on a crypto ops, but not the details. Does that trigger any neurons here?
You asked, "is it legal?". Well, I (happily) no longer have access to the Lexis Law Library computers in prison, so I can't easily look up legal precedent. However, I don't think that much precedent will exist on this issue: It is 'cutting edge' law. Chances are good that it isn't legal, in the sense that it hasn't been declared legal. From what I read on recent CP messages, it sounds like the Feds are engaging in what would be, if done by non-government types, illegal 'cracking'. Flooding a server in a denial of service attack is presumably illegal today, if done in America, and also if done in America directed against foreign hardware/software. Placing malware is probably also illegal in such situations. And since one of the servers in question is in France, French law would presumably apply as well. (It is possible those government-types who engaged in these actions are now criminals, from the standpoint of French law, or even American law, although perhaps nothing will be done about that.) The next question is, "Can the fruits of these activities be used in court against [fill in the blanks]?". There is a doctrine in American law called "Fruit of the poisonous tree" see http://en.wikipedia.org/wiki/Fruit_of_the_poisonous_tree , which generally prohibits the use of evidence obtained by the commission of a crime. But since this doctrine was initiated many decades ago, long before the Internet era, it cannot be certain how this principle will be applied to computer communications. http://www.law.cornell.edu/wex/fruit_of_the_poisonous_tree Actually, I was on numerous occasions the victim precisely this kind of activity: The car I drove (in June 1998 and April 2000-October 2000) had a GPS tracking transmitter placed on it, without a warrant. (the then-current legal thinking was that no such warrant was required; in 1999 there was a Ninth Circuit Court of Appeals case, US v. McIver, that upheld this idea, although that case was quite distinguishable from mine because in the McIver case, there was 1. A real crime. 2. That the vehicle and the defendant were connected to. (Neither of which existed in my case June 1998 or April 2000-October 2000.) Curiously, despite the presence of the tracking device probably as early as April 2000, the Feds went through the motions of getting a (secret, of course) warrant for a DIFFERENT tracking device in late October, 2000, omitting any mention of the fact that they had such a tracker already placed for many months. A lawyer would use this as evidence of deception by the Feds, and of admission that they knew that the previously-placed tracker was illegal: Otherwise, why bother obtaining that October 2000 warrant, if they could have used the information from the previous device at any trial? In January 2012, in a case U.S. v. Jones, the Supreme Court decided that placing such transmitters (even if the car in question is on publicly-accessible property) required a warrant: In other words, to do so without a warrant is illegal and a violation of the 4th Amendment to the U.S. Constitution. Don't think I was unaware of the (likely) placement of that 2000 tracking device. I virtually assumed such a thing was there. But, try as I might, I couldn't get my crooked, colluding attorney (Robert Leen, appointed about November 21, 2000) to demand the fruit of that previous (2000, and 1998) tracking devices for trial. It isn't that the information thus collected was important in itself: Rather, the mere fact that a tracking device was placed (without probable cause, or reasonable suspicion that any crime had been, was being, or would be committed, would have exposed a lot of the criminality committed by the Feds. They would have had to answer the question, "Why did you place those tracking devices on Mr. Bell's car, if you had no reason to believe there was a legitimate law-enforcement reason to do so?". I attempted to fire attorney Leen about December 8, 2000, when he refused to actually defend me by looking for and asking for such evidence. (The evidence I already knew existed.) Curiously, Andy Greenberg (author of "This Machine Kills Secrets") falsely claimed in his book that I had fired every lawyer I was given. The truth is more enlightening: In fact, I didn't fire (or even attempt to fire) my first lawyer, Peter Avenia: He resigned, against my opposition to that, in early-mid-1999. Every subsequent lawyer I had I ATTEMPTED to fire, yet in each case I was unsuccessful at accomplishing that. I attempted to fire them when I verified that they were intending to betray me; but I was in all cases entirely unsuccessful at firing them. They were allowed to stay by the judge, purporting to 'represent' me for many months or even years, until they were successful at doing the damage to me that they intended to do. At that point, and ONLY at that point, did they leave, usually by requesting the judge to allow them to resign. So it is accurate to claim that I never 'fired' any lawyer: I was never allowed to do so. Note: Andy Greenberg could have avoided a great deal of error in his writing if he had merely sent to me a copy of what he intended to write, to give me the opportunity to correct it. He didn't. Jim Bell ________________________________ From: David <wb8foz@nrk.com> To: cypherpunks@cpunks.org Sent: Tuesday, October 8, 2013 9:42 AM Subject: Re: Feds Arrest Alleged Top Silk Road Drug Seller So the obvious question not getting much coverage in the mainstream press: How much domestic work is the Fort doing to carry the FBI's baggage in these recent cases? Is it legal? Separately: I seem to recall a story a few years back about the Fort helping the Feebees on a crypto ops, but not the details. Does that trigger any neurons here?
participants (3)
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David -
Eugen Leitl -
Jim Bell