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Accused Silk Road creator loses bid to dismiss U.S. indictment

Published on Jul 10, 2014 3:46 AM

NEW YORK (Reuters) - The man accused of creating Silk Road, which U.S. authorities said was an online drug marketplace, lost his bid on Wednesday to dismiss a federal indictment accusing him of conspiring to deal illegal narcotics and launder money.

Ross Ulbricht, who prosecutors said was known online as"Dread Pirate Roberts," had claimed he did not conspire with Silk Road users who might have broken the law by completing transactions on the now-defunct website, using the digital currency bitcoin. He also claimed he was not involved in money laundering because bitcoins are not money.

In a 51-page decision, U.S. District Judge Katherine Forrest in Manhattan said, "the design and operation" of Silk Road and Ulbricht's role as an "intermediary" between website users justified letting prosecutors pursue their case.

"The allegations amount to Ulbricht acting as a sort of'godfather' - determining the territory, the actions which may be undertaken, and the commissions he will retain; disciplining others to stay in line, and generally casting himself as a leader," Judge Forrest wrote. "Whether the government can prove the facts alleged is not a question at this stage."

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