This is a brief summary of the responses of Joshua Dratel, Ulbricht’s attorney, to the counts of the Indictment, which clearly do not conform to the allegations. They demonstrate how the law is being misapplied to a United States citizen.
For many more details, arguments and references, please read the Motions here: http://www.wired.com/wp-content/uploads/2014/04/Ulbricht3.pdf.
Clarification: the motions challenge the indictment itself, and whether or not the law is properly and constitutionally applied. They do NOT address the substance of the charge, the facts relating to them or Ulbricht’s guilt or innocence. The alleged criminal activity is only nominally attributed to Ulbricht for the sake of argument. This does not in any way constitute an admission with respect to any allegation in the Indictment.
- Count One: Conspiracy to Distribute and Possess with Intent to Distribute Controlled Substances, in violation of 21 U.S.C. §846. This statute does not address Ulbricht’s alleged conduct. He is not alleged to have possessed or sold drugs, but to have operated a site where they were bought and sold by others.
- Count Two: The Continuing Criminal Enterprise (CCE) under Section 848(a). Historically this has been reserved for “kingpins,” mafia bosses, cartel leaders and upper supervisory personnel directly involved in illegal drug sales. No one allegedly operating a website serving as a “platform” for illegal activity has ever been prosecuted under §848(a). The Indictment does not allege that Ulbricht supervised, organized, or managed any of the “users” who were buying and selling illicit goods and services, only that he was the owner/operator of the site. At worst it says that Ulbricht allegedly acted as a facilitator by providing a platform, but never as a ”kingpin” or leader of a continuing criminal enterprise.
- Count Three: The Computer Hacking Conspiracy in violation of the Computer Fraud and Abuse Act (CFAA) 18 U.S.C. §1030(a)(2)(C). This utterly fails to connect Ulbricht to the unauthorized access to any computer. It only alleges that Silk Road “provided a platform for buying and selling malicious software.” Someone selling software that might be used illegally does not transfer that person’s intent to the site’s host. Establishing a violation of 18 U.S.C. §1030(a)(2)(C) requires “proof that the defendant intentionally accessed information from a protected computer without authorization.” This count does not accomplish that, or even allege knowledge of a conspiracy.
- Count Four: Participation in a Money Laundering Conspiracy in violation of 18 U.S.C. §1956(h). In order to violate this law funds, or a monetary instrument, must be involved. The IRS and the Dept. of Treasury’s Financial Crimes Enforcement Network (FinCEN) formally confirmed that Bitcoins, the exclusive means of payment on Silk Road, do not qualify as a monetary instrument. FinCEN states that virtual currency “operates like a currency in some environments, but does not have all the attributes of real currency.” And “virtual currency does not have legal tender status in any jurisdiction.” Therefore, not being real currency, Bitcoins cannot serve as the basis for a money laundering violation.
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