Illustrations by Susie Cagle
The first time Jared Der-Yeghiayan met Ross Ulbricht was at 3:16 pm on October 1, 2013, moments after the latter was arrested for running the notorious online drugs marketplace Silk Road. But according to prosecutors, the two had been in communication for much longer than that.
The Department of Homeland Security started investigating Silk Road in 2012. By late July 2013, Jared Der-Yeghiayan, a special agent with Homeland Security Investigations based out of Chicago, had taken over the account of a Silk Road moderator. Today in court, he testified about his role in the sting that led to Ross Ulbricht’s arrest on October 1, 2013.
Homeland Security Investigations (HSI) had begun investigating Ross Ulbricht as a possible match for the Dread Pirate Roberts (DPR), the chief operator of Silk Road, based on information received from Gary Alford, a Special Agent with the IRS. Alford’s information had also triggered an FBI investigation that involved FBI computer scientist Thomas Kiernan, who is expected to testify next week, and FBI agent Christopher Tarbell, who is known for his role in arresting the hacker Sabu. HSI and FBI merged forces to operate a sting to capture Ross Ulbricht alongside the smoking gun—an open laptop logged into the Silk Road admin page, and in the middle of an encrypted chat with “cirrus.” At this point, Der-Yeghiayan had been undercover as “cirrus” for about two months, and had access to an encrypted Silk Road staff chatroom that was hosted by a Tor hidden service. By logging into chat, Der-Yeghiayan was able to see when DPR was available online.
The FBI procured a warrant to arrest Ross Ulbricht in September 2013. Der-Yeghiayan arrived in San Francisco on September 30. On October 1, around noon, a team of about half a dozen law enforcement, including Kiernan, Tarbell, and Der-Yeghiayan, met at Café Bello, a few blocks away from Ulbricht’s house—just far away enough “as not to seem unusual.” Der-Yeghiayan carried his laptop, powered on, and connected to a mobile hotspot, so he could monitor whether or not the Dread Pirate Roberts was logged into chat.
DPR was logged in, and Ross Ulbricht was at home. Over the next few hours, the team dispersed, shifting positions across a radius of a few blocks—an area that included Ross Ulbricht’s house, Café Bello, and the Glen Park branch of the San Francisco Public Library. Der-Yeghiayan moved south to a different café, then moved back up to Café Bello when he realized his laptop battery was low. His computer was open and running this entire time, since his ability to monitor DPR was key to the sting.
Click here to read about the shutdown of the illegal bazaar and its tale of online secrecy, murders-for-hire, courtroom drama and corruption.
Café Bello was crowded, and it was hard to find a power outlet. At this point in his testimony, the agent’s smooth and professional demeanor showed a crack—perhaps recalling his panic over the low laptop battery that nearly compromised an inter-agency sting operation.
It was 2:45 pm. Just then, DPR signed off, signaling that he was about to move locations. Der-Yeghiayan unplugged his computer and crossed the street to join up with Kiernan.
While standing on the street with Kiernan, and his laptop (now at 22% battery), Der-Yeghiayan could see Ross Ulbricht just down the block, waiting to cross the street. When the light changed, Ulbricht crossed. He entered Café Bello, which was just as crowded as it had been when Der-Yeghiayan left it. Ulbricht walked right back out, and headed towards the Glen Park branch of the San Francisco Public Library, which is next door to Bello.
As Ulbricht entered the library, Kiernan left to go follow him inside. Der-Yeghiayan remained outside with his laptop. Tarbell rejoined Der-Yeghiayan, and directed the rest of the arrest team first to wait for the undercover agent to chat with DPR, and then while making the arrest, to make sure to pull the laptop first. Right after Ulbricht entered the library, DPR came online in the Silk Road staff chat. Der-Yeghiayan, still undercover as “cirrus,” initiated a chat with him, asking him to check out a customer support issue that would require him to log into the Silk Road admin panel.
The moment DPR asked “ok which post?” the law enforcement team knew that he had logged into the admin panel. Tarbell sent out a signal to arrest Ulbricht, then the two of them entered into the library together. The rest of the team had subdued Ulbricht and seized his laptop, and were in the process of bringing him down the stairs.
Der-Yeghiayan sent his last messages to DPR as “cirrus” at 3:14 pm.
The agent, who had been undercover as a Silk Road moderator since July, met Ross Ulbricht for the first time at 3:16 pm.
For a period of two months, Der-Yeghiayan worked undercover as “cirrus,” dealing with customer support tickets on both the Silk Road marketplace and the Silk Road forum. He worked for 10 to 12 hours each day, and was paid about one thousand dollars in bitcoin from DPR’s Silk Road account every week. The undercover agent communicated with the other Silk Road moderators—“samesamebutdifferent,” “inigo,” and “Libertas”—as well as the Dread Pirate Roberts.
Although the agent had not yet testified as to his involvement in Silk Road 2.0 (nor is it clear whether he will), a moderator named “cirrus” was recruited to help run Silk Road 2.0 (as were the old Silk Road moderators “samesamebutdifferent,” “inigo,” and “Libertas”). This “cirrus” was the last of the Silk Road 2.0 moderators left standing after a rash of arrests in December 2013. Vice Motherboard speculated last December that “cirrus” was the mole that brought down Silk Road 2.0.
