Encrypted Phone Seller Facing Criminal Charges Fights Back, Says Sky Global Isn't Complicit In Customers' Illegal Acts
from the a-possible-exercise-in-futility-but-perhaps-still-a-worthwhile-one? dept
Over the past couple of years, the US government — working with law enforcement agencies around the world — has managed to shut down cell phone services it alleges were sold to members of large criminal associations. These prosecutions have allowed the DOJ to push the narrative that encrypted communications are something only criminals want or need.
But in multiple cases, encryption was never a problem. Investigators were able to target criminal suspects with malware, allowing access to communications and data. The FBI, along with Australian law enforcement, actually ran a compromised encrypted chat service for three years, allowing the agencies to round up a long list of suspects from all over the world.
One of those targeted by these long-running investigations was Canada-based encrypted phone provider Sky Global. The DOJ claimed the company sold phones to criminals and even secured an indictment that charged Sky CEO with assisting in the distribution of at least five kilos of cocaine (this amount triggers mandatory minimum 10-year sentences). This claim was based not on CEO Francois Eap’s own actions, but the alleged actions of his customers, some of whom engaged in drug dealing.
That was added to RICO allegations Eap is facing. But, so far, the US government has made no attempt to extradite Francois Eap and put him on trial. A new report by Joseph Cox for Motherboard possibly shows why the government is hesitant to make this any more of a federal case than it already is. Sky Global is fighting back in court, submitting internal communications that show it made efforts to assist in investigations and refused to remotely wipe phones it could tie to criminal activity.
Sky has filed a motion seeking the return of seized domains [PDF]. In it, the company details how it cooperated with law enforcement and attempted to deter criminals from buying its phones. At this point, Sky Global is effectively dead, even though prosecutors have yet to secure a conviction of Eap or anyone else employed by the company. The DOJ has seized all of the company’s websites, making it nearly impossible to continue to sell phones or provide services to existing customers.
The exhibits included with Sky’s filing show in new detail the effort Sky took to remove criminals from its platform.
Another email sent by Sky’s chief operating officer to what appears to be a Sky distributor says that one of the distributor’s agents has violated the company’s terms of service because of their willingness to sell the Sky ECC product to someone wanting to use it for illicit activity, as well as other violations.
The filing also includes emails sent to customers, letting them know Sky would not assist in remote wipes of devices seized by law enforcement. Other emails show customer service reps rejecting purchasers who made statements suggesting they were going to use the phones to engage in criminal activity.
The DOJ says this means nothing. It claims the company’s statements in emails and attempts to remain unaware of customers and their intentions give it nothing more than “plausible deniability.” But, of course, that’s how plausible deniability works. And the government should know this better than the criminals it’s going after. If deniability is plausible, it means a jury may not return a guilty verdict. And government agencies have long engaged in practices that allow them to plausibly deny they have violated rights or engaged in retaliation against whistleblowers, FOIA requesters, etc. Either seize the cake or eat it, DOJ. Don’t try to do both.
There appears to be some actual deniability contained in all the plausibility.
Other documents show Sky employees declining to wipe devices when asked to do so by resellers.
“Hello. Please delete this ECC ID, the police have it,” one message sent to Sky reads. “PLEASE HELP!!! Two customers have problems with the police. Their devices were confiscated,” another adds. In both cases, Sky declined to wipe the phones, according to the emails.
But there’s still a lot of grey area. Former employees said it was impossible to not know the phones were being purchased and used by criminals. But steps were still taken to prevent employees from wiping phones seized from alleged criminals and to deter third-party retailers from using language that suggested the company would be complicit in the destruction of criminal evidence.
And it went further than that. According to Sky’s lawyer, the company also terminated accounts associated with criminal activity, which goes above and beyond the “plausible deniability” accusations made by the DOJ.
There’s a major caveat to all of this, though.
But all of the documents which Sky provided and Motherboard reviewed which show enforcement of Sky’s policies were created in 2019 or later, after the U.S. prosecution of Phantom Secure’s Ramos.
This was probably a wise reaction. But it was a reaction, nonetheless. If the government can show the company was far more complicit in criminal activity in the past, it will still be able to prosecute. But given its lack of interest in pursuing Francois Eap’s extradition from Canada, it appears the DOJ might be satisfied with prosecuting cases involving Sky phone users, rather than charges against the company itself. Unfortunately, the DOJ has the power to drag this process out forever, effectively denying Sky the opportunity to remain solvent even though its CEO (and others with indictments) are still presumably innocent. Then it just becomes a war of attrition and the DOJ has infinite time and resources.