NZ launches inquiry into spying in Megaupload case

September 24, 2012

Chicago Tribune on September 23, 2012 released the following:

“Reuters

WELLINGTON (Reuters) – New Zealand’s Prime Minister John Key has launched a inquiry into “unlawful” spying by government agents leading to the arrest of Megaupload founder Kim Dotcom, who is fighting extradition to the United States where he faces charges of internet piracy and breaking copyright laws.

The probe may deal another blow to the U.S. case after a New Zealand court ruled in June that search warrants used in the raid on Dotcom’s home earlier this year, requested by the U.S. Federal Bureau of Investigation, were illegal.

Key has asked the government’s Intelligence and Security division to investigate “circumstances of unlawful interception of communications of certain individuals by the Government Communications Security Bureau”, his office said in a statement on Monday.

Key’s spokesman would not comment on whether the “certain individuals” referred to Dotcom, his three colleagues also arrested and facing U.S. charges, or all of them.

“The Bureau had acquired communications in some instances without statutory authority,” Key’s statement said.

New Zealand authorities arrested Dotcom and his colleagues at his rented country estate near Auckland in January, confiscating computers and hard drives, works of art, and cars.

The FBI accuses the flamboyant Dotcom, a 38-year-old German national also known as Kim Schmitz, of leading a group that netted $175 million since 2005 by copying and distributing music, films and other copyrighted content without authorization.

“I welcome the inquiry by (Key) into unlawful acts by the GCSB,” Dotcom said on his Twitter account.

Dotcom maintains that the Megaupload site was no more than an online storage facility, and has accused Hollywood of lobbying the U.S. government to vilify him.

The raid and evidence seizure has already been ruled illegal and a court has ruled that Dotcom should be allowed to see the evidence on which the extradition hearing will be based.

U.S. authorities have appealed against that ruling, and a decision is pending.”

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Douglas McNabb – McNabb Associates, P.C.’s
International Extradition Lawyers Videos:

International Extradition – When the FBI Seeks Extradition

International Extradition – Wire Transfer – Email – Telephone Call

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We previously discussed the extradition treaty between the United States and New Zealand here.

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To find additional global criminal news, please read The Global Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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Govt lawyers red-faced after FBI spirits Dotcom evidence to US

May 23, 2012

New Zealand Herald on May 24, 2012 released the following:

“By David Fisher

The Government’s lawyers have been ordered to explain how the FBI left the country with evidence in the Kim Dotcom case meant to be kept in “secure custody” by New Zealand police.

High Court Chief Justice Helen Winkelmann has told the Attorney-General’s lawyer, Mike Ruffin, he has until Monday to explain why FBI agents were allowed to take 135 cloned computer and data storage devices to the United States.

At a legal challenge at the High Court in Auckland yesterday, Dotcom’s lawyer Paul Davison, QC, called the revelation “high-handed” at best and “at the worst misleading”.

Mr Davison and lawyers for Dotcom’s three co-accused want a judicial review into search warrants used during FBI-inspired raids on January 20. Dotcom, Finn Batato, Mathias Ortman and Bram van der Kolk were arrested over allegations of criminal copyright violation through their file-sharing website Megaupload.

Mr Davison said he asked for assurances in correspondence with Mr Ruffin’s predecessor, Anne Toohey, that no evidence would leave New Zealand shores unless on the back of a court decision.

Crown Law had told him it had “not happened and will not happen without prior warning”. He said yesterday was the first time he was aware any material had left the country and there had been an agreement to maintain the “status quo” over the evidence. “There is no approval for the removal of these clones from New Zealand. There has been an excess of authority.”

Mr Davison said the correspondence included a statement from the head of the police organised crime squad, Detective Inspector Grant Wormald, that the belongings were held in secure custody.

He said Dotcom’s rights had been “subverted or disregarded or worse”.

The revelation is the latest embarrassment for the Crown, which has already been exposed for fumbling parts of the case. It used the wrong law to get a court order to seize Dotcom’s assets – an error which contributed to the police having to offer an undertaking of liability. There had earlier been discontent over the size, scale and style of the police raid which Davison has said will form a complaint to the Independent Police Conduct Authority.

Yesterday, Mr Ruffin said he was aware the cloned copies had been sent out of New Zealand. However, he said he was unaware of Ms Toohey’s assurances to Mr Davison.

Mr Ruffin told the court a set of digital images copied from the computers had been taken to the US. “The actual items seized under the search warrant remain in New Zealand,” he said.

The Crown Law Office and Attorney-General Chris Finlayson refused to comment.”

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Douglas McNabb – McNabb Associates, P.C.’s
International Extradition Lawyers Videos:

International Extradition – When the FBI Seeks Extradition

International Extradition – Wire Transfer – Email – Telephone Call

————————————————————–

We previously discussed the extradition treaty between the United States and New Zealand here.

————————————————————–

To find additional global criminal news, please read The Global Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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International criminal defense questions, but want to be anonymous?

Free Skype Tel: +1.202.470.3427, OR

Free Skype call: mcnabb.mcnabbassociates

           Office Locations

Email:


Kim Dotcom allegedly ridicules charges against him

March 28, 2012
Megaupload Founder Kim Dotcom

RT on March 28, 2012 released the following:

“On Monday MegaUpload founder Kim Dotcom said he is preparing an “entertaining” motion in response to the US government’s charges against him.

The German born, New Zealand millionaire who spent approximately five weeks behind bars for allegedly running the largest media piracy operation, said in an interview with Torrent Freak that not all of the charges against him are accurate.

Dotcom was accused of illegally uploading millions of songs. But according to the millionaire himself many of charges against him are absolutely inaccurate. For example, Dotcom cites an audio file of a song by the rapper 50 Cent he was accused of illegally downloading and distributing. In reality, the New Zealander claims the file was legally purchased.

The file’s link was emailed to several of his friends for the purpose of testing the website’s new email feature. Furthermore, Dotcom claimed the song had a total of zero downloads.

The indictment filed by the US government for his alleged involvement in an online conspiracy that authorities claim stole hundreds of millions of dollars from the entertainment industry, states the 50 Cent email he sent was part of the prosecution’s evidence.

According to Kim Schmitz, aka Dotcom, the file was legally purchased and posted back in 2006 and isn’t relevant due to the statute of limitation having been expired.

In addition to the 50 Cent file, Schmitz also contended that a Louis Armstrong song mentioned in the indictment was also legally bought.

“The indictment contained an email in which I suggested to provide Warner Brothers with a limited number of deletes per day,” Dotcom said in his interview.

“In fact, days later Warner Brothers got the maximum quota of 100,000 deletes per day,” Dotcom said in response to allegations of his refusal to cooperate with the media giant.

Dotcom believes the fact the he was willing to remove the material for his site verifies that he was more than willing to cooperate with copyright holders. Warner Brothers also was able to impede part of the problem by using MegaUpload’s built in tool that allowed for reporting of copy written material on the site.

According to Dotcom, the tool aided Warner Brothers in removing more than one million files from the notorious site.

Dotcom also added that not all users were transferring “pirated” material and claims the recent happenings have hurt those users who held accounts strictly from the purpose of transferring files over long distances without the need of a hard drive, memory stick or DVD. Among those members he added that 15,000 were US military servicemen that probably used their account to share photos with loved ones back home.

Since he set bail in early March, Dotcom has been under house arrests and has been critical on how the US government has handled the situation.

The seven year operator of the MegaUpload has slammed the entertainment industry and the politicians behind the legal proceeding claiming his site’s policies are no different than that of YouTube.

“If you read the indictment and if you hear what the prosecution has said in court, at least $500 million of damage were just music files and just within a two-week time period. So they are actually talking about $13 billion damage within a year just for music downloads. The entire US music industry is less than $20 billion,”explained Dotcom in an interview with New Zealand’s 3news earlier this month.

“In my opinion, the government of the United States protecting an outdated monopolistic business model that doesn’t work anymore in the age of the Internet and that’s what it all boils down to,”he added.

Dotcom promised the motion would soon come.

Amidst a pending extradition request by the US, Dotcom may have the case shift further in his favor, especially after a New Zealand judge ruled that law enforcement apprehended his possessions with a fake warrant. The authorities behind this have filed for another warrant, but if the judge denies the request Dotcom could have access to all his assets once again.”

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Douglas McNabb – McNabb Associates, P.C.’s
International Extradition Lawyers Videos:

International Extradition – When the FBI Seeks Extradition

International Extradition – Wire Transfer – Email – Telephone Call

————————————————————–

We previously discussed the extradition treaty between the United States and New Zealand here.

————————————————————–

To find additional global criminal news, please read The Global Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


USA: The long arm of American copyright-Asia Sentinel

March 21, 2012

facthai.wordpress.com on March 17, 2012 released the following:

“Kim Dotcom and America’s Debatable Hegemony

America’s long arm might be too long. Washington attempts to rewrite the concept of sovereign borders in Megaupload copyright case

Paul Karl Lukacs
Asia Sentinel: March 13, 2012

On Feb. 29, a New Zealand judge reminded the United States government that its power has limits. Washington is unlikely to heed the message.

The issue before the Auckland High Court was whether Kim Dotcom (previously Kim Schmitz) should be given bail for house arrest and electronic monitoring pending his August extradition hearing. The US Justice Department, alleging that Dotcom’s Megaupload family of web sites constituted a criminal conspiracy to infringe copyrights, demanded that Dotcom be held in a Kiwi jail until formally transported to the States for trial.

In his judgment, Justice Timothy Brewer rejected the Americans’ argument, noting “the presumption at law that Mr. Dotcom should have his liberty,” and ordered that the defendant remain out of prison. Justice Brewer, a junior bench officer who has held his post for less than two years, found that Dotcom was not a proven flight risk since, among other factors, the US and allied governments had seized about US$25 million in assets, which Dotcom would presumably fight to regain.

The judge, addressing only the specific issue before him, did not ask the larger question: How exactly was the United States claiming authority over Dotcom, a European operating in Asia and Oceania?

It is a good question. American prosecutors allege that Dotcom, known for his extravagant lifestyle, engaged in criminal copyright infringement. But federal courts have made it clear that US copyright laws apply only within the physical territory of the United States and do not apply outside the country.

“Copyright laws do not have extraterritorial operation,” according to the federal appeals court in New York. Its coordinate court in California agreed, thereby setting the rule for the country’s entertainment industry.

Consequently, the US assertion of jurisdiction against Dotcom is problematic on its face. A review of the factual allegations in the Justice Department’s 72-page indictment reveals that the case is based on a weak jurisdictional foundation, specifically that Dotcom allegedly had a banking relationship with PayPal and that he allegedly stored some data on a few servers in Virginia (possibly without his knowledge). In other words, it is obvious from the prosecutors’ own one-sided version of events that Dotcom operated outside the United States and that investigators were charged with digging deep to find one or two gotchas on which the US could premise its exercise of personal jurisdiction.

While other nations are limited by resources and principles from exerting their will outside of their borders, the US has not been shy about attempting to dictate global rules. In 1977, Congress passed the Foreign Corrupt Practices Act in which it commanded that US nationals doing business abroad were required to adhere to American anti-bribery standards regardless of the economic impact or the on-the-ground reality.

In 2003, anti-pedophile hysteria resulted in the PROTECT Act, which prohibits US travelers from engaging in sexual intercourse with persons under 18 anywhere in the world no matter the local age of consent. Recently, US expats have been subject to financial reporting requirements that strip them of banking privacy.

While the extraterritorial reach of those laws was justified by the drafters on the grounds that they applied only to US nationals, the Dotcom case is a flat-out assertion by the United States that its laws can be applied to anyone anywhere — even when, as with the Copyright Act, federal judges have plainly said that they can’t.

Dotcom appears to have had nothing to do with the United States, and if he did, the Justice Department would have said so. Rather, Dotcom holds passports from Germany and Finland under different names (all of which are legal, as the New Zealand judge noted). His businesses are headquartered in Hong Kong. He lives with his children and pregnant wife in New Zealand.

Yet the US government has used the shakiest of jurisdictional pretexts to close his business, freeze his assets and arrest him, all of which happened without an adversarial hearing on the merits. In a routine civil copyright case, an injunction or attachment of assets can issue only after notice and an opportunity to test the plaintiff s evidence in open court. Here, the US government avoided those safeguards.

In an equally troubling development, multiple foreign governments have assisted the US in its prosecution. For example, at the bail hearing before Justice Brewer, the United States was represented not by independently retained counsel but by the New Zealand government’s Crown Law Office.

When executing the initial arrest warrant, the Kiwi police were armed, an unnecessary show of deadly force when dealing with a businessman accused of a property crime. In the Chinese territory of Hong Kong, police are reported to have dispatched about 100 officers to raid Dotcom’s offices and residences.

The United States is re-writing the very concept of borders. Previously, a nation’s ability to exert its authority was limited by physical restraints which stopped at, or, in some cases, well short of a line on a map. With modern electronics and communications equipment (not to mention mobile armed forces), a wealthy nation can exert pressure where ever it wants against whomever it targets.

Assertions of extraterritorial jurisdiction by major powers may become one of the most controversial legal issues of the decade.”

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Douglas McNabb – McNabb Associates, P.C.’s
International Extradition Lawyers Videos:

International Extradition – When the FBI Seeks Extradition

International Extradition – Wire Transfer – Email – Telephone Call

————————————————————–

To find additional global criminal news, please read The Global Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Megaupload: Kim Dotcom May Regain Possessions, Modern Warfare Crown

March 21, 2012

Forbes on March 19, 2012 released the following:

“In a potentially embarrassing turn of events for the case against Kim “Dotcom” Schmitz, former head of Megaupload and perhaps the third most famous Kim currently living, it seems that the seizure of his property may be overturned as a result of a misfiled restraint order by the New Zealand Police.

Schmitz, a German national, is currently fighting extradition from New Zealand to the US to be prosecuted on charges relating to copyright-infringing material being made available through Megaupload.com and its partner sites. Although Megaupload did not directly sell the allegedly infringing content, it profited from advertising revenues based on page views and subscription fees from premium members. According to the indictment, the damage to copyright holders from Megaupload’s activities totals more than $500,000,000 – although the statistical metrics behind this calculation remain uncertain.

According to a report in the New Zealand Herald, Dotcom’s assets were impounded under an order which precluded the possibility of Him mounting a legal defense to re-acquire them. Described as a procedural error, this will nonetheless look to critics of the handling of the case like the misuse of extreme legal measures designed to battle terrorists and avert loss of life. This narrative has been ongoing since the deployment of armed STG officers – the New Zealand equivalent of SWAT – in the initial raid. Schmitz is a keen and fierce competitor in Activision’s Modern Warfare video game: one consequence of his incarceration before release on bail was the loss of his status as Modern Warfare 3′s highest-ranking multiplayer competitor. This will make for an interesting emotional damages claim in any countersuit.

New Zealand’s Crown Law Office – mindful, no doubt, that when they mess up it makes the Queen look bad – promptly applied for the correct restraining order, listing for seizure items that had already been seized under the previous order. Justice Judith Potter has already declared that the initial order was null and void, and will shortly address claims by Schmitz’ legal team that the property should be returned to their client’s control forthwith.

If the property is returned, along with a number of servers and tools of his trade Schmitz will be able once again to enjoy his Predator Statue, $17,500 Devon Tread 1 wristwatch and perhaps enjoy a game of Call of Duty: Modern Warfare 3 on one of the many enormous TV screens which were seized in the initial raid. Having secured a release on bail in spite of FBI opposition, Schmitz recently made statements to the file-sharing news site Torrentfreak expressing the hope that will soon to be able to reveal the identities of his site’s biggest users in the Department of Justice. If this tactic – of apparently trolling the case against – pays off, Schmitz may be able to say to his prosecutors, as he did to his victims on the virtual battlefield:

“Don’t hate me because I beat you. Respect me because I teach you :)”

However, the DoJ, whose lack of a sense of humour is generally comsidered a feature rather than a bug, may prove a tougher foe than 15 million Xbox antagonists. It’s not all bad news for American copyright abroad – nearer to home, the Crown signed off on the quickie extradition of Richard o’Dwyer for sharing links to copyright-infringing material on his TVShack website, using an extradition act signed hurriedly into law in 2003 as a vital tool in the war against terror. If the line between piracy and terrorism becomes blurred in the eyes of content providers and lawmakers, Dotcom may yet have cause to regret his vaunted gift with a virtual assault rifle.”

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Douglas McNabb – McNabb Associates, P.C.’s
International Extradition Lawyers Videos:

International Extradition – When the FBI Seeks Extradition

International Extradition – Wire Transfer – Email – Telephone Call

————————————————————–

We previously discussed the extradition treaty between the United States and New Zealand here.

————————————————————–

To find additional global criminal news, please read The Global Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Megaupload founder faces lengthy extradition battle

January 25, 2012

Thomson Reuters on January 25, 2012 released the following:

Reporting by Gyles Beckford and Rebecca Hamilton

“Jan 25 (Reuters) – Efforts by the United States to extradite the mastermind of an alleged Internet piracy scheme from New Zealand to face copyright infringement and money laundering charges are likely to be long and complex.

Kim Dotcom, a German national also known as Kim Schmitz, will be held in custody in New Zealand until Feb. 22 ahead of a hearing of a U.S. extradition application.

U.S. authorities claim Dotcom’s file-sharing site, Megaupload.com, has netted $175 million since 2005 by copying and distributing music, movies and other copyrighted content without authorization. Dotcom’s lawyers say the company simply offered online storage and that he will fight extradition.

“It could take some considerable time to get through the whole thing,” said senior New Zealand lawyer Grant Illingworth, adding there were rights of appeal and procedural review to both sides.

Dotcom, 38, and three others, were arrested on Friday after a police raid at his rented country estate, reputedly New Zealand’s most expensive home, at the request of the U.S. Federal Bureau of Investigation.

Under New Zealand’s extradition law the prosecution must show there is enough evidence that would substantiate charges against Dotcom and the others accused of breaching local copyright laws.

“What the judge has to do is decide whether there is a prima facie case that would justify the person being put on trial if the offence had occurred in New Zealand,” Illingworth said.

“If the evidence doesn’t make out, what under New Zealand law amounts to a prima facie case, then the person walks away.”

A 1970 extradition treaty between the United States and New Zealand gives the U.S. 45 days from the time of Dotcom’s arrest to request extradition. The New Zealand Extradition Act, passed in 1999, gives the United States preferential status to access a streamlined process for making its request.

The judge who refused Dotcom bail said he could not assess whether the United States had a strong enough case against Dotcom, nor whether he had a good defense.

“All I can say is that there appears to be an arguable defense, at least in respect of the breach of copyright charges,” Judge David McNaughton wrote in his judgement.

CIVIL MATTER

Copyright infringement and illegal file sharing are normally civil matters in New Zealand, but there is a provision for criminal charges and a maximum 5-year jail term for serious breaches.

Rick Shea, a partner at Lowndes Jordan in Auckland, said there were some differences between New Zealand and U.S. copyright law, in terms of knowledge, that could be an issue.

Douglas McNabb, a U.S. lawyer who specializes in extradition defense, said extraditions to the United States have to meet probable cause – the same standard that is required for making arrests in the United States.

Although the extradition hearing is not a test of guilt or innocence, McNabb said Dotcom’s lawyers may argue they should be allowed a limited discovery process to show that probable cause has not been met.

Prime Minister John Key said the issues raised were serious and New Zealand would co-operate with the U.S. authorities.

“This is the largest, most significant case in Internet piracy so New Zealand is certainly going to work with the United States authorities to allow them to extradite Kim Dotcom,” he said on TV3.

According to Shea, New Zealand has never had an extradition proceeding involving copyright law. “I wouldn’t expect this to be sorted out quickly,” he said.

AGGRESSIVE CHARGES

Anthony Falzone, Director for Copyright and Fair Use at Stanford Law School’s Center for Internet and Society, said it was too early to comment on the strength of the case, but questioned whether some of the allegations in the indictment would actually push Megaupload outside the safe harbor provisions of the Digital Millennium Copyright Act.

The indictment “pushes some pretty aggressive theories”, Falzone said.

The most recent Supreme Court case to deal with similar issues was in 2005. In MGM v. Grokster, the U.S. court highlighted the importance of intent in determining if an Internet firm was liable for its users infringing copyright.

“A lot of the Megaupload case may also rise and fall on the question of intent,” said Falzone.

With MGM, the court found the intent of the Internet company from the beginning was to build a tool to facilitate illegal sharing.

“Maybe that’s what the Feds (FBI) think they have here, too,” said Falzone.

The case is USA v. Kim DotCom et al, U.S. District Court, Eastern District of Virginia, no. 1:12CR3.”

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Douglas McNabb – McNabb Associates, P.C.’s
International Extradition Lawyers Videos:

International Extradition – When the FBI Seeks Extradition

International Extradition – Wire Transfer – Email – Telephone Call

————————————————————–

We previously discussed the extradition treaty between the United States and New Zealand here.

————————————————————–

To find additional global criminal news, please read The Global Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


FBI Seeks Extradition of Alleged Internet ‘Pirate’

January 20, 2012
Megaupload Kim Dotcom
Alleged Megaupload boss Kim Dotcom. Photo: Reuters

The Sydney Morning Herald on January 21, 2012 released the following:

“Kirsty Johnston

AN INTERNET multimillionaire accused of online piracy who allegedly headed up the global file-sharing website Megaupload.com from his luxury mansion north of Auckland faces extradition to the US after he was arrested yesterday by armed police at the request of US officials.

The FBI yesterday shut down Megaupload.com, one of the world’s most popular file-sharing websites, after filing an indictment in a US court earlier this month alleging its founder, Kim Dotcom, 37, (also known as Kim Schmitz) and six others, dubbed the ”Mega Conspiracy”, engaged in racketeering, copyright infringement and money laundering.

Schmitz, a former computer hacker, and six others were arrested on five charges laid in an indictment by a US grand jury in the state of Virginia.

The US Justice Department and the FBI who led the crackdown said Megaupload.com and other related sites generated more than $US175 million ($A168 million) in criminal proceeds and caused copyright holders more than $US500 million in lost revenue from pirated films and other content.

Megaupload is based in Hong Kong, but some of the alleged pirated content was hosted in the US on leased servers in Ashburn, Virginia, which gave US authorities jurisdiction, the indictment said.

Megaupload has boasted of having more than 150 million registered users and 50 million daily visitors, according to the FBI indictment. At one point, it was estimated to be the 13th most frequently visited website on the internet.

Schmitz founded the Hong Kong-based Megaupload website in 2005, which distributed a myriad of copyrighted works including movies, television programs, music, software and books. Megaupload also offered financial incentives for users to upload popular content and drive web traffic to the site.

Schmitz made $US42 million from Megaupload and other associated websites in 2010, according to the FBI’s indictment.

Despite opposition to the site’s operations from record labels and other copyright holders, many celebrities and artists backed its work – with chart-toppers Kanye West, Will.i.am and P. Diddy starring in a support video last year.

The US indictment paints a picture of a sprawling multinational operation, with more than 20 search warrants executed in nine countries, including New Zealand and the US.

When he appeared in Auckland’s North Shore District Court yesterday, Schmitz, a flamboyant German computer hacker who has past convictions from his home country, said he ”had nothing to hide” when appearing alongside three of his co-accused. ”We don’t mind if there’s press coverage if people want to photograph us, let them,” he said, overriding his lawyer, Auckland QC Paul Davison.

Detective Inspector Grant Wormald said it was ”likely” the men had also breached New Zealand copyright laws, although police had no intention of laying charges in the country.

The men face copyright infringement charges in the US which carry sentences of up to 20 years.

Schmitz is no stranger to being on the wrong side of the law, with a list of convictions including insider trading, credit card fraud, hacking and embezzlement. Schmitz also holds Finnish citizenship, and has Hong Kong and New Zealand residency.

Schmitz was granted New Zealand residency, reportedly after investing $NZ10 million ($A8 million) in government bonds and making a generous donation to the Christchurch earthquake fund.

Possessions taken from his $30 million mansion yesterday provided a hint of the extravagant lifestyles of the accused men.

More than 20 luxury cars worth a combined $6 million were taken from the site, including a 2008 Rolls-Royce Phantom Drophead Coupe, with the licence plate ”GOD”. Others including Mercedes Benzes, a Maserati and a Harley Davison motorbike.”

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Douglas McNabb – McNabb Associates, P.C.’s
International Extradition Lawyers Videos:

International Extradition – When the FBI Seeks Extradition

International Extradition – Wire Transfer – Email – Telephone Call

————————————————————–

We previously discussed the extradition treaty between the United States and New Zealand here.

————————————————————–

To find additional global criminal news, please read The Global Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.