Popular file-sharing site closed by US federal authorities; seven arrests so far
The US authorities have seized and closed down Megaupload, one of the world's biggest and most popular file-sharing sites.
Megaupload is a service that allows people to anonymously upload and transfer large files such as movies and music. It had hundreds of servers based all around the world, including 525 in Virginia and 630 in the Netherlands.
The problem for the authorities was it could be used for both legal and illegal purposes by people; and the executives of Megauploads were complicit in the illegal activities.
On Thursday, following a two-year international investigation into criminal copyright infringement by the site, federal authorities seized domains associated with the company; which the US Department of Justice has called a "mega conspiracy... whose members engaged in criminal copyright infringement and money laundering on a massive scale."
The site is alleged to have earned $175m, the cost of which to the copyright owners has been put at $500m. Seven of Megaupload's key executives have been arrested so far. Four of these arrests were in New Zealand and included the site's founder Kim Dotcom (formerly known as Kim Schmitz).
However, Megaupload posted a response on its website that said not only is it the victim of "grotesquely overblown" allegations, but it did take down infringing material if told about it.
"Recently, we have drawn some flak over our sites allegedly serving the sole purpose of mass copyright breach. Since some of the allegations are grotesquely overblown, we would like to put things into perspective.
"Mega has over 150 million registered users and over 50 million daily unique visitors. Employees of over 70 per cent of the world's Fortune 500 companies have accounts with us... We also cooperate closely with rights holders and their copyright enforcement agents and provide them with direct realtime takedown access, bypassing the DMCA process entirely.
"Because we strictly conform to all legal requirements, nobody has successfully sued us over copyright infringement, and cases brought forward against our competitors have a long history of being unsuccessful."
However, this has not persuaded the Department of Justice, which believes the links Megauploads removes are to give it a veneer of legitimacy; hence this week's arrests.
Megaupload executives have been accused of five counts of copyright infringement and conspiracy. But the take-down as resulted Anoymous launching a series of denial of service attacks against sites including the Department of Justice, FBI, White House and sites associated with Universal and Warner Music.
The group stated: "We Anonymous are launching our largest attack ever on government and music industry sites," said a statement purporting to be from the Anonymous group. "The FBI didn't think they would get away with this did they? They should have expected us."
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