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Appalbarry writes:

In a story that should interest anyone involved in on-line security the Canadian Press reports that:

The chief executive of a Vancouver-based company appeared in a Washington state court on Thursday in the first U.S. case in which a company has been targeted for providing criminal drug cartels with the technology to evade law enforcement, the U.S. Justice Department said.

Phantom Secure CEO Vincent Ramos was indicted, along with four of his associates, on charges related to providing criminal organizations with cellular phones and encrypted networks to coordinate the shipment of illegal drugs around the world.

"Phantom Secure allegedly provided a service designed to allow criminals the world over to evade law enforcement to traffic drugs and commit acts of violent crime without detection," said FBI Director Christopher Wray in a statement.

CNBC suggests that Phantom Secure was selling "hacked" BlackBerry and Samsung phones:

The people behind a company that hacked Samsung and BlackBerry phones to make them more secure, have been indicted for allegedly conspiring with drug cartels to help them evade law enforcement and sell narcotics.

Phantom Secure, a Canada-based firm, sold Samsung and BlackBerry devices that had been modified with a higher encryption. This made it difficult for the authorities to trace drug traffickers.

Phantom Secure's web site does say that:

We are a law-abiding company that is permitted to deliver encrypted communication services to our clients in order for them to protect their communications, without having the ability to decrypt their communications. Our service does not require personal information and has no back doors.

In providing such a service we do understand that there will be a very small number of people that may use our service to do activities we do not support. We do not condone the use of our service for any type of illegal activities and if known we will terminate the use of our service without notice. Considering this, requests for the contents of communications may arise from government agencies, which would require a valid search warrant from an agency with proper jurisdiction over Phantom Secure. However, our response to such requests will be the content and identity of our clients are not stored on our server and that the content is encrypted data, which is indecipherable.

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