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The Network: How a Secretive Phone Company Helped the Crime World Go Dark
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The Network: How a Secretive Phone Company Helped the Crime World Go Dark [vice.com]:
In December 2017, Judge Hayes sentenced Hanson, the former UFC footballer turned drug trafficker, to 21 years in prison [sandiegouniontribune.com]. Now in his remarks building up to delivering Ramos' sentence, Hayes said "The history and characteristics of Mr. Ramos, as with many individuals who come before the court: mixed." He is a gentleman, well spoken, and obviously a very talented businessman and very successful in legitimate employment before this case, Hayes added.
"But at some point he became very successful in the business he was in," and "he was committing crimes by doing it," Hayes continued. "And at some point I have no doubt that he understood what he was doing was criminal;" that is, assisting drug traffickers. Weighing up factors such as the scale of the operation, the fact that Ramos had no prior criminal record, and that many of the people Ramos assisted likely would have committed their crimes with or without Ramos' help, Hayes came to a decision.
The judge sentenced Ramos to nine years in prison [vice.com].
This was significantly less than the 14 years prosecutors asked for. Ramos may be able to transfer to Canada after five years in an American jail. After release, he will also be barred from engaging "in the employment or profession relating to developing and maintaining encryption services and devices," Hayes said during the hearing.
Multiple sources in and around Phantom did not see a RICO case coming against the company. Some civil legal problems from importing SIM cards perhaps. But not the law used to specifically take down criminal organizations.
"Many people believed that what I was doing was completely legal and that this was a war on privacy," Ramos said in an email from prison. He is currently incarcerated in USP Marion, a medium security jail in south Illinois. Ramos was referring to the wave of attorneys, privacy advocates, and other people interested in his case that he said contacted him after the FBI announced his arrest.
"Nobody actually thought selling to [criminals] was illegal. It isn't in Canada. Or Australia," the source with knowledge of Phantom's operations said. "It is under RICO in the USA."
"If the Kangaroos can't take you down they'll call the big Eagle. And the Eagle can take anyone down," Bruno said.
Serious organized criminals continue to use encrypted phones to communicate, moving from one provider to another as law enforcement agencies chip away at them bit-by-bit. Some drug traffickers used the services of a firm called Ennetcom, before Dutch authorities shuttered it. Other criminals have even gone so far as to create their own encrypted phone companies; firms such as Scottish-based MPC [vice.com] were literally created by and for organized crime.
Law enforcement agencies' operations against the phone companies have escalated too. In March of this year, French police managed to infiltrate Encrochat [vice.com]. But they went a dramatic step further, and pushed malware onto the Encrochat devices themselves [vice.com], letting investigators read users' messages before they were sent layered in encryption. Authorities obtained tens of millions of text messages, and arrested hundreds of suspected criminals.
In parallel, the use of encrypted or privacy-focused messaging apps has skyrocketed, by criminals but mostly among the wider public. Wickr is a free encrypted messaging app that offers extra features to enterprise customers; Signal is another similar app developed by a non-profit organisation and which also provides the cryptographic code that powers many other encrypted messaging apps, including WhatsApp.
Ramos could have "had a Wickr or Signal before they even hit the scene," Bruno said.
"Had he invested in the right team, structure, management, advisory etc," he added. "But he just wanted to party and drive expensive cars... such a waste."
