The former Eagle Scout accused of running the $1.2 billion online drug bazaar "Silk Road" may face life in prison if convicted in a trial where jurors will hear allegations he tried to arrange the murders of six people.

Prosecutors claim Ross William Ulbricht, 30, or "Dread Pirate Roberts," as he was allegedly known online, ran "the most sophisticated and extensive criminal marketplace on the Internet," where people used bitcoins to buy illegal drugs, guns, phony identification, computer hacking help and other illegal goods and services anonymously.

"It's being alleged as a worldwide enterprise with folks everywhere, and the quantities that are alleged are huge," U.S. District Judge Katherine B. Forrest, who will oversee the Manhattan trial, told lawyers in a hearing last month.

Ulbricht has pleaded not guilty to the seven counts against him, including trafficking drugs on the Internet, narcotics-trafficking conspiracy, computer-hacking conspiracy and money-laundering conspiracy. If convicted in the first-of-its-kind trial targeting the Internet's dark side, Ulbricht could spend the rest of his life in prison.

His lawyer, Joshua Dratel, declined to comment on the charges.

Forrest, appointed to the bench by President Barack Obama in 2011, last week sentenced Abu Hamza al-Masri, a Muslim cleric who preached at a London mosque attended by Sept. 11 plotter Zacarias Moussaoui, to life in prison for his role in a deadly hostage-taking and a failed bid to start a terrorist training camp in Oregon. She ruled against Ulbricht on several key issues before the trial set to start tomorrow.

Forrest rejected Ulbricht's attempt to block the government from introducing evidence he tried to arrange six murders, including a hit on a former employee he believed had stolen $350,000 in bitcoins.

In another alleged plot, prosecutors claim Ulbricht paid someone $150,000 to kill a Silk Road user who called himself FriendlyChemist. The government claims FriendlyChemist sought to extort Ulbricht by threatening to publish a list of the names and addresses of Silk Road sellers and buyers unless he was paid $500,000.

Ulbricht, who is separately charged in Baltimore federal court with the alleged plot against the former employee, doesn't face murder solicitation charges in the New York trial. Forrest said the government may use the evidence to tie him to Silk Road and to narcotics trafficking. Prosecutors have said they have no proof that any murders were actually carried out.

In November 2013, a U.S. magistrate judge cited those alleged plots in denying Ulbricht's request for bail. He's confined in a federal prison in downtown Manhattan.

Ulbricht's online name was taken from a character in the 1987 film "The Princess Bride," prosecutors said. He's charged with running Silk Road from 2011 to 2013. The Texas native was arrested in a San Francisco public library on Oct. 1, after logging onto his computer as "Dread Pirate Roberts," prosecutors said.

Federal agents seized Silk Road, along with bitcoins worth $3.6 million, and shut down the site on Oct. 2, 2013. Prosecutors said in court filings that the site generated $80 million in commissions on sales of more than $1 billion in less than three years. Three Silk Road employees were charged in addition to Ulbricht.

Blake Benthall, 26, was charged in November with starting a almost identical online market called "Silk Road 2.0" weeks after Ulbricht's arrest. Benthall's arrest was part of a coordinated operation by 16 countries targeting the Tor network, which allows people to use the Internet anonymously by routing traffic through multiple servers. U.S. and European agencies said they shut down 410 hidden web domains, arrested 17 people and seized about $1 million in bitcoins.

Last month, former Bitcoin Foundation Inc. executive Charlie Shrem was sentenced to two years in prison after pleading guilty to transferring money he knew was to be used for illegal transactions. Shrem was arrested in January 2014 when he arrived at John F. Kennedy International Airport in New York after giving a speech in Amsterdam about bitcoins.

Robert Faiella, who operated the BTCKing exchange and was charged with Shrem, pleaded guilty to running an illegal money business and is awaiting sentencing.

Forrest in October rejected Ulbricht's request to bar electronic evidence seized by government agents from his Gmail and Facebook accounts, a laptop and a computer server in Iceland.

The judge ruled that Ulbricht, who didn't make any claim to a privacy interest in the materials, couldn't show that his rights were violated. If he had made such a claim, she said, prosecutors could question him about it if he testifies in his own defense.

The criminal case is U.S. v. Ulbricht, 14-cr-068; the civil forfeiture case is U.S. v. Ulbricht, 13-cv-06919, U.S. District Court, Southern District of New York (Manhattan). The murder- for-hire case is U.S. v. Ulbricht, 13-00222, U.S. District Court, District of Maryland (Baltimore).

Subscribe Now

Authoritative analysis and perspective for every segment of the payments industry

14-Day Free Trial

Authoritative analysis and perspective for every segment of the industry