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Monthly Archives: February 2014

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As the wave of controversy over government spying continues, Kim Dotcom is advising privacy startups to think carefully about where they intend to invest. The Mega entrepreneur is advising companies to stay away from countries including the United States, United Kingdom, Canada and Australia, where monitoring is now considered widespread. Dotcom, who has a considerable investment in New Zealand, says his privacy services will move to Iceland if proposed new laws become reality.

The uproar kick-started by the revelations of Edward Snowden don’t appear to be going away any time soon, as citizens increasingly become aware that their online privacy rights can be disappeared at the touch of a button.

Just yesterday the NSA spying controversy claimed another victim, with email service Lavabit announcing that it will shut down rather than “become complicit in crimes against the American people.” The email service would not provide additional details but their silence is being interpreted as a symptom of US Government pressure.

With Snowden now living in Russia, the rest of the world is trying to cope with its apparent privacy-free status. One of people’s first reactions to eavesdroppers in the real world is to lower their voices, and in the digital domain the reaction has been much the same.

The recent announcement from Pirate Bay founder Peter Sunde,  that he is now part of a team bringing an NSA-proof messaging app to the market, was greeted by an enthusiastic audience putting their cash on the line. Privacy clearly matters to people.

This hasn’t gone unnoticed by Kim Dotcom  either, who is already heading up Mega.co.nz, aka ‘The Privacy Company’. Mega’s moves towards encryption preceded Snowden’s revelations, but Dotcom is well aware that the market is now ripe for spy-proof services.

The German-born entrepreneur is already prepping two new products – an encrypted messaging app and an encrypted email service – both due to market within the next few months. While previously set to launch from Mega’s New Zealand base, Dotcom has now cast doubt on that assumption.

This morning, Dotcom told his 313K Twitter followers that if new local spying laws become reality, Mega will move its privacy services overseas to Iceland.

“Mega plans to move privacy operations away from New Zealand to Iceland if the new #GCSB & #TICS spy laws are becoming reality,” he said.

The GCSB and Related Legislation Amendment Bill and Telecommunications (Interception Capability and Security) Bill are a concern to Dotcom and other New Zealand citizens as they will force telco providers to provide intercept capabilities so that police, security and spying services can access citizens’ communications online. The bills give GCSB, New Zealand’s spy agency, sweeping powers of oversight into the design and operations of all local network providers.

And Dotcom isn’t on his own with his concerns. Last week Microsoft suggested it may withdraw from New Zealand if the surveillance laws are introduced, warning that they represent a threat to its industry.

But of course other countries are also engaged in widespread spying, and Dotcom has issued a warning to new companies preparing to invest.

“Privacy startups & encryption services should move to Iceland or other privacy friendly jurisdictions,” he said, specifically warning against setting up in the United States, United Kingdom, Canada, Australia and New Zealand.

Hitting governments in their pockets might be the only way to get them to sit up and listen but we’ll have to wait to find out whether citizens care enough to vote with their wallets too.

WIRED article - File-sharing tycoon Kim Dotcom has a plan to become a multi-millionaire again: He’s filed a seven-figure lawsuit against the New Zealand government over the spectacular 2012 assault on his mansion, and the electronic spying that preceded it. Court filings released this week show Dotcom and associates have made good on a threat last year to sue police and the country’s main spy agency, the Government Communications Security Bureau, or GCSB, for the SWAT-style raid in which Dotcom and the others were arrested a year and a half ago. The New Zealand government appealed a ruling last year that granted Dotcom the right to sue, but lost last March. Court documents filed in the High Court earlier this year, but not made public until this week, lay out Dotcom’s case that the police were excessively invasive and aggressive in conducting the raid, and used NSA-like spy systems to place him under covert surveillance. “The case will show how the Five-Eyes spy cloud, X-Keyscore and PRISM were utilized in our copyright case,” Dotcom tells WIRED. “Remember, I’m not a terrorist.” Dotcom’s mansion was illegally raided on January 20, 2012 by heavily armed police officers from the elite Special Tactics Group and Armed Offenders Squad, arriving in helicopters and vans. Some of the officers wore uniforms; others were dressed in civilian clothes without any police insignia or similar identification. The U.S. government is accusing Dotcom, the founder of Megaupload, of running a criminal conspiracy that made hundreds of millions of dollars by letting users share copyrighted files online. The Justice Department seized the company’s many domain names, servers and assets at the time of the raid, and is seeking extradition of Dotcom from New Zealand to the United States for trial. In the court documents, which were filed in April and May, and first released by the New Zealand Herald this week, the arrest raid is described as violent, with doors being broken down and holes knocked into walls, damaging the property. Dotcom’s then pregnant wife, Mona, was separated from her three other young children and kept away from them by force outside the mansion, according to the complaint. Police also allegedly forced Dotcom to the ground, leaving him with bruises and abrasions, despite his not resisting arrest. “Throughout the operation the Police paid little or no effective regard to the rights or needs of the occupants of the properties, and dealt with them in a highly aggressive, oppressive and intimidatory fashion, such as to cause significant unnecessary distress and anxiety and fear,” the complaint claims. Dotcom’s legal advisers were also denied access to the property by the police, who seized cell phones and cut off landlines to prevent any communication with the outside world. Citing GCSB documents, Dotcom’s lawyers allege the spy agency illegally intercepted Dotcom, family members’ and associates’ communications since at least December 16, 2011. GCSB was not, at the time, permitted to spy on legal permanent residents like Dotcom, but the New Zealand government has since legalized such surveillance. Dotcom’s lawyers also claim that the police seized an excessive amount of property from the mansion, including network switches and routers, power supplies and jewellery belonging to Mona Dotcom and Junelyn van der Kolk, another plaintiff. Dotcom is accusing New Zealand’s top spymaster Ian Fletcher of acting unlawfully, along with the minister in charge who signed off on the action, Bill English. All in all, the claim is for a total of 6 million New Zealand dollars (US $4.85 million).