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U.S. charges three over Silk Road marketplace

By Nate Raymond and Joseph Ax

NEW YORK (Reuters) - Three men were indicted in the United States on Friday in connection with Silk Road, the Internet black-market bazaar in which illegal drugs like heroin and cocaine can be purchased for the digital currency bitcoin.

The indictment, unsealed in New York, charges Andrew Jones, Gary Davis and Peter Nash with conspiracy to engage in narcotics trafficking, computer hacking and money laundering.

The charges followed the arrest in October of alleged Silk Road founder Ross Ulbricht, who is known online as "Dread Pirate Roberts.

U.S. authorities shut Silk Road down at the time of Ulbricht's arrest, although last month a new marketplace carrying the same name and appearance debuted online.

Jones, 24, and Davis, 25, acted as site administrators for Silk Road, while Nash, 40, was the primary moderator for the website's discussion forums, the indictment said.

Jones was presented before a court in Richmond, Virginia, on Friday after being arrested the day before, according to the Manhattan U.S. Attorney's Office. Davis was arrested in Ireland and Nash was arrested in Australia, the office said.

Lawyers for the defendants could not immediately be located for comment.

According to the indictment, the three men were part of Ulbricht's "small support staff" for Silk Road. Salaries for the employees ranged from $50,000 to $75,000 a year, the indictment said.

Jones, who also went by "Inigo," worked for Silk Road from October 2012 through the time the original website was shut down, the indictment said.

Nash, who was also known by names including "Batman73" and "Anonymousasshit," was a moderator since at least January, while Davis, also called "Libertas," acted as an administrator since at least June, the indictment said.

The indictment accuses them of conspiring to violate U.S. narcotics and computer hacking laws. Silk Road, in addition to providing a venue for illegal drug sales, had also enabled the sale of "malicious software" intended for hacking, the indictment said.

Ulbricht, 29, was charged in a separate criminal complaint in October. He is being held at a metropolitan detention center in Brooklyn after last month losing a petition to be released on bail.

Ulbricht's lawyer, Joshua Dratel, has been discussing a possible plea deal with prosecutors, according to court filings. Ulbricht is also under federal indictment in Baltimore, Maryland, in a case relating to a murder-for-hire plot.

On December 6, Assistant U.S. Attorney Serrin Turner asked U.S. Magistrate Judge James Francis for a 30-day extension of the deadline to file an indictment, saying that he and Dratel had spoken in October and November about a possible resolution of the case and planned to continue talking.

The judge granted the request, which was not opposed by Ulbricht. Dratel did not respond to a request for comment Friday.

The case is U.S. v. Jones, U.S. District Court, Southern District of New York, No. 13-cr-950.

(Reporting by Nate Raymond and Joseph Ax; Editing by Dan Grebler)

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