MegaUpload shut down by US government, four execs arrested

By on January 19, 2012, 4:28 PM

The US government has shut down one of the world's largest filesharing destinations, calling the service an "international organized criminal enterprise allegedly responsible for massive worldwide online piracy." In cooperation with the United States, New Zealand arrested four MegaUpload executives including founder Kim Dotcom today, while authorities are pursuing three other site operators.

The charges stand "among the largest criminal copyright cases investigations ever brought by the [US]" and investigations are underway in the Netherlands, Philippines, UK, Hong Kong, Germany, and Canada. The DOJ issued over 20 search warrants in the US and eight other countries, seizing more than $50 million in assets, including a luxury car collection as well as 18 MegaUpload-related domains.

The filing says Dotcom and his associates are responsible for $175 million in criminal proceeds (i.e. income via subscription fees and advertising) on top of costing copyright owners more than $500 million in lost revenue. Ironically, TorrentFreak notes that only a few weeks ago, Dotcom boasted that his ventures had nothing to worry about (legally speaking) because they complied with the law.

Dotcom, his workers, MegaUpload Limited and Vestor Limited (another firm associated with Dotcom) are charged with two substantive counts of criminal copyright infringement, engaging in a racketeering conspiracy, as well as conspiring to commit copyright infringement and money laundering. If convicted, they could face 50+ years in prison for the combined charges (TorrentFreak offers a breakdown).




User Comments: 62

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Chazz said:

Holy shit. That's some very serious claims, I wonder what type of evidence they have.

SNGX1275 SNGX1275, TS Forces Special, said:

Who needs SOPA/PIPA when this can happen already?

hahahanoobs hahahanoobs said:

SNGX1275 said:

Who needs SOPA/PIPA when this can happen already?

Yea, because we should have the right to get movies, tv shows, and games illegally.

RIP Ice Films. It was a fun ride while it lasted.

hahahanoobs hahahanoobs said:

chazz said:

Holy shit. That's some very serious claims, I wonder what type of evidence they have.

The type of evidence that gets you arrested and your website shut down.

lalaman lalaman said:

T.T NO MORE ICEFILMS T.T

Anyways, the evidence can be found in this indictment:

scribd.com/doc/78786408/Mega-Indictment

(assuming this comment nor the indictment gets taken down)

freedomthinker said:

Holy crap. Happy day ! Taking down websites for no good apparent reason ! US government is amazing , no'?

Staff
Matthew Matthew, TechSpot Staff, said:

Not sure why you'd think your comment would be deleted lalaman. Thanks for sharing. I was going to include a few DOJ links but they either yanked the pages or their site can't handle the current load. Hopefully Scribd's entry stays up.

Chazz said:

hahahanoobs said:

chazz said:

Holy shit. That's some very serious claims, I wonder what type of evidence they have.

The type of evidence that gets you arrested and your website shut down.

Yes, exactly. It seems like something more sinister than I could've imagined was going down. Hence, I wonder what evidence they have.

lalaman lalaman said:

Actually rumour says that "Anonymous" brought down the DOJ site :P

Also if you go on wikipedia, you see the the Department of Justice has become the Department of "Justice"

[link]

Look on the right hand side on the page

inventix1136 said:

What is the difference between megaupload and Amazon Cloud drive? One didn't give campaign contributions last year and the other did. Otherwise they are the same, providing sort of a digital locker.

P.S. If the exec's are found guilty then we can kiss the "cloud" industry good bye.

Guest said:

****. This is starting to get really serious and out of hand. What the hell is gonna happen to the rest of the pirating site i.e piratebay, isohunt, etc.

Darth Shiv Darth Shiv said:

hahahanoobs said:

SNGX1275 said:

Who needs SOPA/PIPA when this can happen already?

Yea, because we should have the right to get movies, tv shows, and games illegally.

RIP Ice Films. It was a fun ride while it lasted.

The point SNGX1275 was making was they didn't need SOPA/PIPA to stop this site.

Leeky Leeky said:

****. This is starting to get really serious and out of hand. What the hell is gonna happen to the rest of the pirating site i.e piratebay, isohunt, etc.

Wave goodbye to them.

If SOPA/PIPA passes, even mentioning them on some sites would see them swiped offline. That is the problem, where do you draw the line?

Is linking illegal content hosted on another server an offence that warrants the shut-down of that site and treatment identical to the server that hosted it to begin with?

Its a very fine line. Though in this case I would imagine considerable evidence has been collected that justifies the warrants and seizures that have taken place. Time will no doubt tell though.

SOPA/PIPA will make existing legal steps even shorter, and the wielded power greater. Yes it was taken down without SOPA, but having that tool in the legal arsenal would make the process even faster and more damaging.

Puiu Puiu said:

Unlike SOPA they at least had a ton of actual evidence to support their case. ^_^ I've read the indictment and here's the result: "They are in MEGA DEEP SHIT!"

Vrmithrax Vrmithrax, TechSpot Paladin, said:

inventix1136 said:

What is the difference between megaupload and Amazon Cloud drive? One didn't give campaign contributions last year and the other did. Otherwise they are the same, providing sort of a digital locker.

P.S. If the exec's are found guilty then we can kiss the "cloud" industry good bye.

I think you are confusing just what the "cloud" is. You store your files, personal information, run your programs from "the cloud." You know, things you actually have paid for, are legally licensed to use, etc. At the worst, you are storing illegal stuff in the cloud, but that's storing. As in personal. Private use, with the ability to share or collaborate some content (provided it does not break the terms of the agreement you entered into when establishing your cloud account).

If you think for a second that this accurately describes Megaupload's operational model, I think you missed some key points in how they worked.

The cloud industry is safe. Violators of cloud policies on copyrighted materials will not be. And with the cloud, it's not as anonymous as P2P or other forms of sharing.

Vrmithrax Vrmithrax, TechSpot Paladin, said:

freedomthinker said:

Holy crap. Happy day ! Taking down websites for no good apparent reason ! US government is amazing , no'?

Riiiiiiight... Cause, you know, there were no other governments involved in this at all. Well, except for New Zealand, who must have agreed with the charges enough to back and assist in the seizure and arrests... Oh, and the Netherlands, Philippines, UK, Hong Kong, Germany, and Canada, who are all investigating the same group for the same illegal activities... Oh, but by all means, make it out to be the US doing stuff "for no good reason."

SNGX1275 SNGX1275, TS Forces Special, said:

The point SNGX1275 was making was they didn't need SOPA/PIPA to stop this site.

Yes, thank you.

That was exactly my point. Laws are already in place to stop piracy, this happened, I assume, legally.

ramonsterns said:

Huh, I'm also curious as to what these men did.

Guest said:

when is ?OUTUBE going down?

nirvanafr3ak said:

Rapidshare is bigger than Megaupload. These websites and bussiness are covered. They don't out front encourage corighted material to be uploaded and even take down links when requested by the owners or companies. MU must have been involved in other illegal activities to be taken down like this. Of course, it is been twisted so that it seems like their regular business model is illegal( which is not)so that it scares users off from websites like these. (Fileserve, Rapidshare, Filesonic, etc, ect , etc).

Guest said:

What I find funny is they probably think that this will have an impact on the pirating community.

Sure a couple of pirates will get upset because they paid for a subscription and others because their links are now dead.

But Uploaders will be notified, find another Hosting Site and upload there.

Even if you take down all the obviously guilty Content Providers Uploaders will just start making accounts from Content Providers like Amazon S3, Dropbox, Box.net etc... And failing that there is still Torrenting.

I can understand the importance of standing up against Piracy but Megaupload is one out of a huge array of similar sites.

Megaupload has been up for a very long time and just imagine the effort they put in to co-ordinate with countries, Investigate and collect evidence. All this effort to take out one site out of hundreds is the wrong way to go.

Personally I think providing a better service than the pirates will be more effective than what they are doing now.

inventix1136 said:

Vrmithrax said:

inventix1136 said:

What is the difference between megaupload and Amazon Cloud drive? One didn't give campaign contributions last year and the other did. Otherwise they are the same, providing sort of a digital locker.

P.S. If the exec's are found guilty then we can kiss the "cloud" industry good bye.

I think you are confusing just what the "cloud" is. You store your files, personal information, run your programs from "the cloud." You know, things you actually have paid for, are legally licensed to use, etc. At the worst, you are storing illegal stuff in the cloud, but that's storing.

...

The cloud industry is safe. Violators of cloud policies on copyrighted materials will not be. And with the cloud, it's not as anonymous as P2P or other forms of sharing.

Trust me, all it takes is ONE file in the cloud that is in violation and that is it. If they can sue and terminate websites like piratebay, which is only storing LINKS to content but not the actual content, then actually STORING the content would be much worse -- regardless of the cloud policy or what the cloud user did.

superphoenix said:

Terribl

Holy crap. You know what?

The major leaders are citizens of Germany and Finland, they live in New Zealand, but they are captured just because they violate the US laws.

This nation is becoming a terrorist now.

Guest said:

Time to get rid of the US Gov by force. They won't listen to the people and do what the people want, then the people will destroy them. This IS the American Way!!

Guest said:

and so the 2012 apocalypse begins.

RH00D RH00D said:

If anyone is looking for an alternative to MegaUpload I give a huge recommendation to MediaFire, their site is easy to use and they don't have wait times and you can download as many files as you want without getting cut off like RapidShare and other popular sites do.

Guest said:

The future will look like this:

- when there will be no so called illegal or pirate sites left to distribute free content, the content producers will have to offer the content for free because people will have no money left to buy it.

At that time everyone will be in debt so with what money to purchase ?

Guest said:

If the jury thinks the likely sentence is excessive, it can acquit regardless of the "law" and the facts, and the acquittal is binding. It's called "jury nullification". But the jurors won't be told this in court. They'll need to hear about it from elsewhere. Spread the word!

Guest said:

How the F*** can the US go into another country to stop their website?? Makes no sense...

SantistaUSA said:

Damn that sucks! I was about to renew my membership, at least I didn't loose my money!

Tomorrow_Rains said:

Here's a fun fact... Lets say you've paid for a membership before with megaupload (I know i have, more than 3 times) The Department of Justice is currently Holding on to your IP address. That is assuming that megaupload keeps its information stored for more than 30 days.

Richy2k9 said:

hello ...

"it has begun ...."

& I'm afraid the worst is yet to come (at some point of view)!

& what i've read about some hacker's retaliation plan would just give the perfect excuse for more actions

cheers!

marinkvasina marinkvasina said:

inventix1136 said:

Vrmithrax said:

inventix1136 said:

What is the difference between megaupload and Amazon Cloud drive? One didn't give campaign contributions last year and the other did. Otherwise they are the same, providing sort of a digital locker.

P.S. If the exec's are found guilty then we can kiss the "cloud" industry good bye.

I think you are confusing just what the "cloud" is. You store your files, personal information, run your programs from "the cloud." You know, things you actually have paid for, are legally licensed to use, etc. At the worst, you are storing illegal stuff in the cloud, but that's storing.

...

The cloud industry is safe. Violators of cloud policies on copyrighted materials will not be. And with the cloud, it's not as anonymous as P2P or other forms of sharing.

Trust me, all it takes is ONE file in the cloud that is in violation and that is it. If they can sue and terminate websites like piratebay, which is only storing LINKS to content but not the actual content, then actually STORING the content would be much worse -- regardless of the cloud policy or what the cloud user did.

They can't take down thepiratebay, stop acting smart

You don't know how they work, go on their site and read their letter about SOPA

it clearly states that they can't take them down

captaincranky captaincranky, TechSpot Addict, said:

Could this be the beginning of the sexpocalypse? The end of free porn as we know it....?

Relic Relic, TechSpot Chancellor, said:

Just skimmed over the indictment and man some of this looks really bad. They apparently 'willfully built up a racketeering enterprise since 2005', have several very bad looking e-mails dating back for years, money laundered millions included having rented yachts in the Mediterranean to promote infringement and a lot more if I'm reading this correctly.

So ya...these allegations if true look to be pretty serious and more than just some cloud service which hosted 'copyrighted content' that they tried to police.

SNGX1275 said:

Who needs SOPA/PIPA when this can happen already?

+1, this should be more than enough to convince congress that we already have enough laws on the books to handle these situations, if not too many.

captaincranky said:

Could this be the beginning of the sexpocalypse? The end of free porn as we know it....?

Highly unlikely considering they upload everywhere and there are hundreds of tube sites.

captaincranky captaincranky, TechSpot Addict, said:

I'm wondering if "megaupload" saw the writing on the wall. They changed their name to "Croko file" or something similar a couple of months ago.

treetops treetops said:

Never really used mega, when I did I usually got a virus. But as far as I could tell users paid to upload whatever they wanted and let other download it for free. Idk what money laundering none sense they were doing but I am surprised they got yanked.

MrTomTom said:

RIAA got their way. Sure, the "Mega Conspiracy" are dirty pirates of the interweb, whatever.

Truth is Megaupload used a viable business model which promoted an alternative media outlet besides the traditionnal disc and dvd.

So my question is when will those media companies learn that there is no more zillions to make in CDs? When will they learn they have to shift to a cloud based media outlet?

Offer and demand is the law of economics and anyone can create or duplicate a CD by themselves, it's not a highly demanded and costly item anymore: there is no point putting such a high price tag on those CDs when mp3s take seconds to create at the cost of nothing.

The only way the music business I imagine can work out is if the music artists distribute by themselves their production. Nobody needs a cd factory to share their music, that concept is outdated ever since people encoded .mp3 files from a CD.

About the big music labels,they are desperately holding on to the old ways that made them rich and now they can barely follow the technological progress made by digital distribution.

To all copyright holding artists, I urge you to turn yourself to new music labels that promote artists through media outlets such as Spotify. That's the new way, the future. Don't be as greedy as the boys at UMG and friends....

Guest said:

And that happens right after the UMG youtube takedown bull**** and MegaSong...

Coincidence?

To be honest, a few years ago that might've sounded a bit too theory-ish ti me but now it seems quite possible.

hitech0101 said:

Well now i have a problem will have to migrate to torrents completely.

Guest said:

"The charges stand "among the largest criminal copyright cases investigations ever brought by the [US]" and investigations are underway in the Netherlands, Philippines, UK, Hong Kong, Germany, and Canada."

... Interesting. We know how the first two of those countries are regarding these kinds of things, more so for the Asian country among the two, which virtually doesn't have any strict cybercrime laws. They're probably not going to get anything from investigating in those countries.

YanFr said:

Finally some justice!

Seems like the pirate days of so many thief's are coming to an end.. and i am very glad of this turn of event's.

I hope that this trend will continue to all the major and small filesharing companies.

Guest said:

Oh noes! I'll have to use one of the 50 other http download sites or bittorrent or usenet or gnutella or irc, or if all else fails, actually pay for ****!

example1013 said:

Guest said:

If the jury thinks the likely sentence is excessive, it can acquit regardless of the "law" and the facts, and the acquittal is binding. It's called "jury nullification". But the jurors won't be told this in court. They'll need to hear about it from elsewhere. Spread the word!

Acquittal means the jury would find the defendant(s) not guilty. The reason jury nullification doesn't happen often may be more that the jury actually thinks the person is guilty than because they don't know about it. Why would you acquit someone who has been proven beyond reasonable doubt to have committed the crime?

I'm not on the jury so I'm not about to hang Dotcom and his associates, but the evidence is pretty damning, and it looks like he's probably guilty.

Also, if the people automatically assuming this is just about piracy would take off their tinfoil hats for a second, they'd notice that a lot of the money numbers being thrown around involve actual money that these guys allegedly spent, not imaginary money "lost to piracy".

Guest said:

I would assume that the will of the people will pervail. Other sites have been obliterated by such legal wranglings, such as MiniNova a couple of year ago. Kazaa and other sites as well have had to either shut down or modify the way they do business. There is a new program called Telex that will basically make the whole internet a proxy server, letting you slip into any website undetected and unstoppable. That may come into being if SOPA and whatever else the legal beagles try to conjure up in an effort to enforce internet censorship.

Lionvibez said:

YanFr said:

Seems like the pirate days of so many thief's are coming to an end.. and i am very glad of this turn of event's.

I hope that this trend will continue to all the major and small filesharing companies.

Just shows up much the general public actually knows about pirates.

Real pirates don't use Torrents or Megashare, Mega upload etc etc.

The only thing this will do it is make it more difficult for the novice users to get free stuff.

This isn't going to do anything to the real scene.

Twixtea said:

This is ridiculous...!

Why don't they take down yahoo, msn, youtube, opera and others down aswell? Yahoo and msn messenger offer file sharing aswell, and opera browser has a file sharin system aswell.

What would be left of the internet? Government sites? No thanks.

Guest said:

Haven't you been paying attention? The US can apparently enter any other country and do whatever it wants to.

Guest said:

nice job USA & New Zealand. Let's put these prick-less pirates into butt rape jail where they belong! Next up, get those anonymous losers, they should be easy to find with their pasty skin, lack of a job or girls, and live in their mom's basement!

Guest said:

"Haven't you been paying attention? The US can apparently enter any other country and do whatever it wants to. "

As it should be! Third world countries need to learn not to mess with the best!

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