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New U.S. charge for man accused in underground online drugs market

By Emily Flitter

NEW YORK (Reuters) - U.S. prosecutors unveiled a new charge on Tuesday against the man they accuse of creating the underground online drugs marketplace known as Silk Road, potentially adding years of prison time if he were convicted.

In an indictment filed in federal court in Manhattan, 29-year-old Ross Ulbricht is charged with engaging in a continuing criminal enterprise by acting as organizer and supervisor of at least five others who were violating a law against drug trafficking. The new charge carries a mandatory minimum sentence of 20 years in prison if he is convicted.

Ulbricht was also charged with of one count each of money laundering, computer hacking and drug trafficking, charges that were first laid out in a criminal complaint last October.

Prosecutors accused Ulbricht of involvement in Silk Road, which they said sold drugs and criminal services in exchange for Bitcoins, a digital currency that is coming under increasing scrutiny by authorities.

"It's the same factual allegations packaged in a statutory wrapper designed to increase the penalties," Ulbricht's lawyer Joshua Dratel said on Tuesday.

Ulbricht was arrested October 1 in a public library in San Francisco, shortly after authorities shut down the web site Silk Road, a marketplace vendors and customers accessed using an encryption program that strips internet users' identifying information to allow them to communicate anonymously with each other.

Ulbricht has maintained his innocence through statements by his lawyer. Ulbricht is expected to enter a not guilty plea when he makes an initial court appearance scheduled for Friday to answer the indictment.

The indictment by a grand jury marks the end of an initial period during which Ulbricht could have talked with prosecutors and made a deal to soften any sentence rendered against him by pleading guilty and cooperating.

(Reporting By Emily Flitter; Editing by Grant McCool)

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