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Silk Road trial: Ross Ulbricht’s college friend testifies against him

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Ulbricht told him everything.

On the verge of tears, Richard Bates entered the court room just after noon on Thursday. 

He was there to tell the jury that Ross Ulbricht had confessed everything to him about Silk Road, the black market that grew into a multimillion-dollar empire in just two years.

Ulbricht is currently standing trial in Manhattan on charges related to operating Silk Road, including drug trafficking, computer crimes, fraud, and other charges. If convicted, he could face life in prison.

Bates, dressed in a black suit worthy of a funeral, was frowning and looked profoundly upset. His voiced cracked and wavered throughout the testimony.

Lyn Ulbricht, Ross’s mother, smiled as he entered the courtroom but Bates didn’t bring himself to look at the Ulbricht family.

“I was shocked,” Bates said when asked what his reaction was to UIbricht’s secret. “And a little intrigued.”

Bates and Ulbricht went to school together at the University of Texas in Dallas. Bates studied computer science while Ulbricht studied physics.

When Bates, a programmer at eBay, moved to Austin in 2010, Ulbricht began to ask him a torrent of programming questions. It came to the point where Bates refused to answer anymore until Ulbricht revealed why he was asking.

“I was suspicious he might be hacking into a website or something,” Bates said.

So in February 2011, just after Silk Road launched, Ulbricht told him everything.

“I remember seeing the home page. I saw the green camel for the first time and pictures of drugs,” Bates said.

Bates was a recreational drug user himself, although he says he stopped in the summer of 2013. He smoked marijuana, ate psychedelic mushrooms, and took Vicodin, among other illegal substances. In 2011, he began to buy most drugs off of Silk Road..

When Ulbricht was arrested in 2013, police quickly found a long list of GChats between the suspect and Bates. It was clear that Bates provided tech support to Ulbricht both before he knew about Silk Road and for some time afterwards. Bates’s testimony is ongoing, and it’s not yet clear how long and how deeply he aided the site.

“What did you do when police approached you outside your apartment?” the prosecutors asked.

“I lied to them,” Bates said, his head hanging down low. “I said I didn’t know Ross ran Silk Road. I was scared.”

In exchange for a non-prosecution agreement, Bates is now testifying in order to avoid charges for the drugs he purchased on Silk Road under then name Melee, the tech assistance he provided and, he said, a Bitcoin exchange he was building with Ulbricht.

 The pressure of the operation ramped up quickly after Bates found out. Media attention piled on. Ulbricht checked in a few days after the site was featured on a national radio program.

“Friggin crazy,” Ulbricht wrote in a GChat conversation. “You gotta keep my secret buddy.”

Update 4:35pm ET, Jan. 22: Following an afternoon break, lead defense attorney Joshua Dratel cross-examined Bates.

Dratel showed the jury chats between Bates and Ulbricht in which Ulbricht complained about being “overwhelmed” and stressed out during 2011 due to the operation of Silk Road.

In November 2011, an incredible thing happened: Someone posted an article about Silk Road on Ulbricht’s Facebook wall with the message “I’m sure authorities would be interested in your drug running site.”

It was a friend of Julia’s, Ulbricht’s girlfriend during the beginning of Silk Road.

Ulbricht hurried to delete the post and de-friend the person who made it. He rushed over to Bates’s home and asked him if he’d told anyone. Bates said no, but that it was obvious Ulbricht should shut the site down.

“I can’t shut it down because I’ve already sold it to someone else,” Ulbricht said according to Bates’s testimony.

“I believed him,” Bates testified.

For much of 2012 and 2013, Ulbricht and Bates continued to speak about Silk Road occasionally, but the conversations took on a different tone. The previously “stressed out” Ulbricht now said he was “chillin’.”

“Glad that’s not my problem anymore,” Ulbricht chatted to Bates in 2013. “I have regrets, don’t get me wrong, but that shit was stressful. Still our secret, eh?”

The cross-examination was meant to show the stark change between 2011 and 2012. If Ulbricht was less overwhelmed, Dratel implied, it was because he had sold Silk Road off and was no longer the operator.

The prosecution disagreed. After Bates stepped down, they produced a Dec. 29, 2011 chat between Dread Pirate Roberts (DPR) and Variety Jones, the mentor who became DPR’s right-hand man.

Jones asked Ulbricht who knew about his role in the site.

“Two people,” he said, allegedly referring to Julia and Bates. “They think I sold the site and got out a month ago.”

He said he’d never speak to one again, and the other he planned to drift away from now that he had moved to San Francisco, over 1,000 miles away from his former home in Austin, Texas.

Jones said that for all the secretive motions Ulbricht had been through, he was clearly the weak link because of these two people. It was then, according to the chat logs, that Variety Jones suggested Ulbricht use the DPR moniker.

“Have you even seen The Princess Bride?” Jones asked.

Ulbricht had, but they went through why the name was a perfect fit: In The Princess Bride, the character Dread Pirate Roberts is just a name passed from one person to the other in order to inspire certain ideas.

Jones said he came up with the idea after “12 solid hours of thinking.”

“Start the legend now,” Jones advised.

“I like it,” Ulbricht replied.

Photo via Free Ross/YouTube

Patrick Howell O'Neill

Patrick Howell O'Neill

Patrick Howell O'Neill is a notable cybersecurity reporter whose work has focused on the dark net, national security, and law enforcement. A former senior writer at the Daily Dot, O'Neill joined CyberScoop in October 2016. I am a cybersecurity journalist at CyberScoop. I cover the security industry, national security and law enforcement.