Feds Apparently Didn't Communicate With Each Other About Various Silk Road Investigations

Legal Issues

from the left-hand,-right-hand dept

There’s been plenty of talk about Silk Road since the site got shut down and Ross Ulbricht was arrested and accused of being Dread Pirate Roberts behind the site. Of course, it struck us as interesting that hours after the arrest and the criminal complaint in NY, there was also an indictment in Maryland. Since then, there have been a bunch of Silk Road related arrests concerning drug dealers who used the site. One of those, as named in our last post on this, was Steven Sadler of Bellevue, Washington.

The folks over at The Smoking Gun have a bunch of details about Sadler, which show that he wasn’t discovered as a result of the Ulbricht arrest, but rather had been raided months ago and became an informant for the feds. His arrest and court hearing were rushed into place after the Ulbricht arrest and the site shut down:

The hastily arranged court appearance for Sadler was prompted by the FBI’s arrest a day earlier of Ross Ulbricht, who has been charged with being the mastermind behind the Silk Road site, which operated on the “darknet” (or “deep web”). Simultaneous to Ulrich’s bust, federal investigators shut down the two-year-old site, which relied on the anonymizing tool Tor to shield both vendors and patrons.

During the October 2 hearing, federal prosecutor Thomas Woods told Tsuchida that “Mr. Sadler has been cooperating, working for the government for the past two months.” Referring to “unusual circumstances,” Woods noted that “through reasons unrelated to” Sadler, his cooperation “abruptly came to an end this morning.” Sadler’s lawyer told Tsuchida that her client was in “constant communication with the government.”

Of course, this makes you wonder just how (un)coordinated the various efforts against Silk Road really were by the feds. We’ve got two separate lawsuits filed against Ulbricht in two separate courts, and now we find out that the feds had already been working one of the site’s top dealers (Sadler went by the name “Nod” on the site). You’d think the feds would be a bit more communicative with each other over their various attempts to investigate Silk Road, its operators and users.

The details also suggest a few other informants, including one who taught investigators how to use Silk Road:

Investigators also were aided by a confidential informant who agreed to cooperate after agents seized several packages mailed to her by Silk Road heroin dealers. In a TSG interview, the woman–a business owner in her thirties–said she had made several heroin purchases from “Nod” and allowed investigators to take over her Silk Road account to make undercover drug purchases.

A self-described “junkie” who has been clean since May, the informant said she helped a postal inspector navigate Silk Road and explained how to fund an account with Bitcoin, the virtual currency used for purchases. When an undercover drug purchase failed to arrive, a postal inspector–apparently sensing a rip-off–sent the woman an e-mail seeking advice as to how to address the missing Express Mail parcel with the narcotics seller. When the informant referred to the package “going missing,” the inspector replied, “I know the package is not missing, I work for the post office…hahaha. They just have not sent it.”

Either way, it seems likely that more arrests are coming, but it still seems to suggest a level of dysfunction among the feds with regards to coordinating their investigations.

Filed Under: communication, law enforcement, ross ulbricht, silk road, steven sadler
Companies: silk road