MANHATTAN (CN) – After a federal judge allowed the defense pursue a theory of an “alternative perpetrator,” lawyers for Silk Road “mastermind” Ross William Ulbricht named no fewer than four alternative identities behind the account for the Dread Pirate Roberts.
Prosecutors maintain that the 30-year-old Ulbricht alone ran the “Dread” account, known as “DPR” for short and named after a character in the William Golding book-turned-1987-movie “The Princess Bride.”
Over the past two days of trial, Ulbricht’s lawyer Joshua Dratel has not been shy about naming names of alternative suspects, even though none of the men on his list has been charged with any crime.
Last week, Dratel floated a theory that the former owner of a Bitcoin exchange company, ex-Mt. Gox honcho Mark Karpeles, “set up” his client to avert law enforcement’s gaze away from him and boost the value of the anonymous online currency.
Karpeles, a French citizen now living in Japan, took to his Twitter account shortly after last week’s proceedings to deny any association with DPR and Ulbricht, and later released a lengthier public statement.
Department of Homeland Security agent Jared DerYeghiayan testified this past Thursday that he thought Karpeles was in fact DPR, and swore to that belief in an affidavit for a search warrant months before Ulbricht’s arrest.
Prosecutors did not object throughout this section of testimony, and defense attorneys argued that this meant that they had waived any right to contest it.
But U.S. District Judge Katherine Forrest granted the government’s motion to strike DerYeghiayan’s former suspicions as inadmissible hearsay as trial continued on Tuesday morning.
Dratel complained the ruling would “completely eviscerate” a key aspect of the defense, but prosecutors failed to stamp out his wider theory of an alternative perpetrator.
Taking advantage of that opening, Dratel fired off more questions about Karpeles and three other men – alleged Mt. Gox associate Ashley Barr, Canadian Anand Athavale and a man named Richard Bates – as DerYeghiayan’s testimony stretched past its fourth day.
DerYeghiayan confirmed that Barr and Karpeles had been associates, but he said that the men later had a “falling out.”
The agent added that he probed the travel records of Athavale, who was from Vancouver, and sifted through four pages of IP addresses associated with him.
Dratel noted that Athavale and his client had both been in the Pacific Time Zone, which is associated with the timestamp on the DPR account.
DerYeghiayan testified that Bates crossed his radar because of Internal Revenue Service agent Gary Alford, who also tipped him off about Ulbricht.
Unlike with Ulbricht, however, DerYeghiayan said he had never probed Bates further.
In late July 2013, the FBI identified Silk Road’s servers and captured its images. DerYeghiayan acknowledged that this created a “lot of pressure” to identify its leader.
“There was concern about wanting to shut down the site and do it properly,” he said.
Without obtaining full control of the website and arresting its leader, a new one could be created, the agent explained.
Dratel noted that this indeed happened one month after his client’s Oct. 1, 2013, arrest, when Silk Road 2.0 hit the Internet.
Ironically, the same afternoon that Dratel made this remark, federal prosecutors in Washington state unsealed allegations against 26-year-old Brian Farrell, who allegedly used the moniker “DoctorClu” to become a “key player in Silk Road 2.0.”
Dratel had no comment about the development except to quip that Washington state also lies in the Pacific Time Zone.
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