Canadian tech moguls made millions selling encrypted messaging software that criminal groups relied on for years to distribute massive amounts of cocaine across Europe before law enforcement began to intercept and decode their messages.
The founders of Vancouver, Canada-based Sky Global now face racketeering and drug trafficking charges in the United States related to crimes committed by criminals using their technology. He denied any wrongdoing and counterattacked last week.
The Justice Department indicted CEO Jean-François Eap and Thomas Herdman, one of the company’s foremost distributors, in March, and the Federal Bureau of Investigations (FBI) seized the company’s 100 internet domains. .
Prosecutors argue in federal indictment that Eap and Herdman “knowingly and intentionally participated in a criminal enterprise which facilitated the transnational importation and distribution of narcotics through the sale and service of devices encrypted communication “.
Sky Global sold encrypted messaging software to criminals who used it to operate massive cocaine trafficking network in Europe, US Department of Justice indictment says
Criminal groups relied on the messaging system for years before law enforcement began intercepting and decoding their messages. Company founders now face racketeering and drug trafficking charges in the United States
The indictment also alleged that Eap and Herdman had violated the Racketeer Influenced and Corrupt Organizations Act (RICO), a law originally designed to prosecute Mafia bosses.
Sky Global’s new motion demands that the FBI return the domains of its website, arguing that the seizure violates its First and Fifth Amendment rights.
“Providing encrypted messaging solutions and protecting consumers’ privacy rights is not illegal,†Sky Global wrote in its petition in federal court in San Diego.
“What happened here is the equivalent of the government seizing Apple.com because the drug dealers are using the iPhone’s encryption features to communicate with each other.”
The company also said it has taken steps to prevent Sky Global’s technology from being exploited by criminals. He claims he should be given the opportunity to continue to focus on such efforts.
The company relied on third-party resellers, in many cases linked to organized crime, and worked to prevent them from supplying the technology to criminals.
It is not known when the technology fell into the hands of criminals and to what capacity, but in 2018 Belgian law enforcement began intercepting messages to fight cocaine trafficking across Europe.
Sky Global alleges that its target consumer base included individuals and groups concerned with privacy and data privacy, including doctors, government contractors and celebrities.
But, according to the Wall Street Journal, a corporate location map appeared to reveal that phones installed with their technology, which have contract costs of up to $ 2,500 for six months, were used almost exclusively by criminals.
Sky Global’s encrypted technology allows users to clear their email history by making a request to the Sky Global support team.
“The company’s devices are specifically designed to prevent law enforcement from actively monitoring messages between users,” according to the indictment.
The indictment also alleges that Sky Global employees used a cryptocurrency like Bitcoin to facilitate illegal transactions for its customers and maintain their anonymity.
The indictment says the company has taken a ‘ask nothing / do nothing’ approach to working with customers so that it can claim plausible denial in case someone with their technology uses it to. commit crimes.
Their internet domains were also seized by the FBI in the indictment in March.
CEO Jean-François Eap (left) and Thomas Herdman, one of the company’s foremost distributors, have denied any wrongdoing and filed a petition last week demanding that the FBI return the domains of its site Web.
“The indictment alleges that Sky Global generated hundreds of millions of dollars by providing a service that allowed criminal networks around the world to hide their international drug trafficking activity from law enforcement,” he said. Acting US Attorney Randy Grossman said in a statement.
“The companies that do this are perpetuating the deadliest drug epidemic in our country’s history. This groundbreaking investigation should send a serious message to companies that think they can help criminals in their illegal activities, â€he added.
However, Sky Global argued in its court case that the company refused to erase messages from phones held by law enforcement.
Sky Global urged the FBI to provide the company with copies of warrants and any other documents regarding the legal basis for “its seizure and custody of Sky Global’s property, thereby depriving it of any meaningful possibility of judicial review.”
The federal case against Sky Global has not progressed since March’s indictment and Eap has not been extradited to the United States. Sky Global wrote in the petition that Eap and its lawyers contacted the US government in July to discuss the pending charges and to cooperate. with his investigation, but Eap’s offers were ultimately turned down.
The company also handed over internal documents and reportedly attempted to resolve the seizure of its domains by the FBI, without court intervention.
Some of Sky Global’s internal documents show how it supplied its devices to Canadian law enforcement in the hopes of winning a contract with their agency.
Officials found around a billion messages from tens of thousands of Sky Global-enabled devices around the world
Specifically, Belgium has arrested more than 500 suspects and seized 88 tonnes of cocaine, already surpassing last year’s record, the new outlet reported.
“The government, however, has refused to engage in substantive discussions regarding the confiscation issues raised here,” the motion reads. “As a result, Sky Global had no choice but to file the instant request for the return of its property.”
Sky Global reported 120,000 active users before its removal in March. Now essentially a dead company, Sky Global has had to lay off 27 employees and 14 contractors.
“Anyone concerned about privacy should be deeply troubled by how the government nearly shut down a legitimate, law-abiding company that was trying to solve critical data protection and privacy issues,” said Ashwin Ram, a company lawyer, at Vice News. .
Ram added that Sky Global had no control over its third party vendors, “beyond contractual obligations prohibiting the illegal use and marketing of its technology.”
Eap, an entrepreneur with a background in computers and telecommunications, started Sky in 2010 in Vancouver, Canada, and neither he nor the company had any known legal issues until the indictment last March.
It is not known when the technology fell into the hands of criminals and to what capacity, but in 2018 Belgian law enforcement began intercepting messages to fight cocaine trafficking across Europe.
“It’s their Achilles heel,” Kevin Daniels, DEA deputy chief for Europe, told The Wall Street Journal. “Often we are two or three steps behind. They are looking for the latest technological advantage over us. But we find a way to catch up.
Officials found around a billion messages from tens of thousands of Sky Global-enabled devices around the world. Specifically, Belgium has arrested more than 500 suspects and seized 88 tonnes of cocaine, already surpassing last year’s record, the new outlet reported.
Officials intercepted a number of messages containing gruesome photos of victims of gang violence and detailed plans to carry out gruesome murders, though Eap and Herdman are not charged on any of these.
In one case, a Serbian gang planned to assassinate a judge and discussed everything from planning a getaway to how the wind would affect a sniper bullet. What they did not know was that their messages were seen by the police in Belgium, who warned the Serbian authorities and saved the judge.
In another case, a Sky Global client sent instructions to an associate on how to torture a particular target. The user on the other end of the message could not locate their victim, so another message arrived with a picture of a woman and the text: “Here are pictures of the woman”. You can break his legs.
Belgian Justice Minister Vincent Van Quickenborne told the Wall Street Journal that the treasure trove of messages was a “holy grail” because the criminals suing Sky Global were so brazen and confident that the service was impenetrable.
