[Koremat6666]

May be I missed it but can someone tell me what was the crime the company was committing ? Almost any company will have defensive strategies such as stalling LEOs and Warrants in whatever way they can. A lot of this is not really "crime" as in kidnapping people or shooting people dead in some alley.

Is having shell companies a crime ? I know a ton of bay area "startups" than engage in these sort of tricks to maximize the brand damage. Ask.com and other toolbar companies are great examples where they will just rebrand the same toolbar as X and sell it to 10 companies which were owned by same entity. Half the companies with "explosive" growth were using mass mailing techniques than involved spamming. Many used foreign companies to skirt US law related to spamming.

I think author is overthinking.

[normalnorm]

Am I the only one getting depressed with all the excuses and rationalizations in this thread? It's the same with "adtech" and the like... "Hey, I'm not killing anyone, what's the harm?"

Technology has the potential to raise humanity above its current conditions and limitations. But we can't have it, because we are selfish and short-sighted monkeys. Take a big dump on all the ideals if this delivers the paycheck. "Business" justifies everything. Fuck humans.

A global instantaneous network of information exchange? Let's turn it into a dystopic market of bullshit covered in distasteful advertising, Idiocracy-style. AI breakthroughs? Will help make the Skinner box much more effective! A search engine capable of finding any public piece of information in human record? Replace the entire thing with ads in disguise! Still, autocratic regimes want to censor some of the ads? Can do, they are a huge market!

Space programs? Canceled. We now have a Rube-Goldberg machine made of human suffering that can deliver whatever trinket you want the next day to your door, nicely package in a cardboard box with a corporate grin printed on it. But don't worry, some guy who sells cars is taking us to Mars or something.

Fuck all this.

[Ragnarork]

No you're not the only one.

I find especially baffling the rationalization over the type of crime. You don't need to physically harm someone to be committing a crime, and there's a lot of different crimes that happen in paper and/or bytes that don't (directly) physically harm people.

That doesn't make them right or okay by any means.

[nkrisc]

The issue is when people try to stack-rank the "badness" of crimes. "Is bankrupting a thousand people through fraud worse than killing someone?" The answer is: it doesn't matter which is worse. Both destroy lives in different ways.

Fraud and spam are crimes that ruin lives in their own ways.

[spottybanana]

> The answer is: it doesn't matter which is worse. Both destroy lives in different ways.

Though it is very natural for people to think "how bad I am" or "how bad is that company compared to the other companies" and so on. Also in the end the justice system has to sentence these crimes and there has to be some kind of "badness" metric that should be seen as fair by the general public. I don't think this "they are all just crimes" approach works.

[nkrisc]

Sure, I understand why people want to. I just think it's a futile effort. In order to determine whether bankrupting 1000 people is worse than killing 1 person you have to quantify all those variables, including the value of a human life (an actuary will gladly do that for you). By some measures, say economic impact, killing a single person may not matter at all, depending on who they are. What people want is to quantify morality. Good luck.

However what we do see that correlates to some "badness" metric is the punishment we mete out for crimes. Years of imprisonment is a simple, linear measure that can be used to measure crimes against one another.

You see it all the time. So and so killed a person and got X years in prison, but this other guy ran a Ponzi scheme and got Y years in prison. Whether X is greater than Y, and your viewpoint, will determine if you think that's fair or not. But my original point is I think it's a rather pointless determination to begin with because it isn't really telling you anything. It doesn't answer the question of whether one crime is worse than another because that's fundamentally a philosophical question that I don't think can be measured.

[Rury]

Right on.

Similarly, people often conflate something morally good with something morally bad and ask/argue ”If I mix the two is it overall good or bad?". Which similarly doesn’t matter.

The good should never be conflated with the bad. Otherwise, the good will just be used for rationalizing the bad...

(That’s not to say morality is not somewhat ambiguous. I just often see people trying to justify immoral behavior by doing this)

[Koremat6666]

> Fraud and spam are crimes that ruin lives in their own ways.

I never denied that. I wanted to know what exactly is the fraud that the company is causing. Also, spamming is all about matter or perspective. All major consumer companies send billions of emails. I would love to know what this company was doing differently .

[arethuza]

I suspect that if someone did bankrupt a thousand people through fraud you are going to have a number of suicides on their hands.

[TeMPOraL]

Agreed. If you account for second-order effects, the result could look pretty grim. That's why I'm of the opinion that some white-collar crimes can absolutely be worse than violent ones - including murder - and that they should be punished accordingly.

[TeMPOraL]

You're not the only one. And don't even get me started on adtech. I share your sentiment 100%. See [0].

--

[0] - http://jacek.zlydach.pl/blog/2019-07-31-ads-as-cancer.html.

[normalnorm]

Excellent blog post. You mention several things that we are so used to, that we don't even notice the abuse, such as the polluting of culture by association of works of art with commercial brands through relentless advertising. To this day, I associate Carmina Burana with cheap male cologne.

Another one for you: in Berlin, buildings under renovation are allowed to place gigantic ads on the scaffolding. I imagine the original ideas was benign, to sort of subsidize the loss of revenue by business owners and renters, and thus encourage maintenance for the good of the city. Of course, there is nothing that marketers won't try to pervert, and this is an easy one. In the most desirable advertising locations, buildings tend to enter states of perma-renovation. This got particularly horrible during the last Word Cup, with historical buildings in my area covered with gigantic ads with tacky things written on them in gigantic letters, such as : GOOOOOOOOOOOOOOOOOOOOOOOOOOOOL! BUY THE NEW XYZ VR HEADSET

What depresses me to no end is how apathetic everyone is to this relentless erosion of culture and quality of life.

[TeMPOraL]

Thanks. I'll be adding this to the article.

I've heard opinions that something similar is happening in my country too (Poland), and it would explain some strategically placed buildings in Kraków that can never seem to finish being renovated, and that also happen to feature ridiculously large ads on the scaffolding.

[athenot]

This is a great article.

> I remember reading about cases of scientific papers that were advertisements pretending to be research work. I'll update this point when I find some actual examples.

Not exactly the same but related: soda manufacturers have been stressing the correlation between inactivity and diabetes, and in the process sliding in the message that sugar intake is not that big of a factor. That messaging goes with ads of healthy people in movement enjoying life and drinking sugar water.

[TeMPOraL]

Thanks. It's related enough; if you know of a decent article on the topic, I'll happily link to it.

[athenot]

Here are a few links that contain some pointers:

NYTimes Blog: Coca-Cola Funds Scientists Who Shift Blame for Obesity Away From Bad Diets - https://well.blogs.nytimes.com/2015/08/09/coca-cola-funds-sc...

Endocrine Web: The Coke Controversy: The Marketing Message That Could Spell Trouble for People Dealing with Diabetes and Obesity - https://www.endocrineweb.com/news/diabetes/coke-controversy-...

Study: Coca-Cola – a model of transparency in research partnerships? A network analysis of Coca-Cola’s research funding (2008–2016) - https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5962884/

Union of Concerned Scientists blog post: How Coca-Cola Disguised Its Influence on Science about Sugar and Health - https://www.ucsusa.org/resources/how-coca-cola-disguised-its...

[TeMPOraL]

Thank you!

[matheusmoreira]

Advertising companies also act as censors. If some advertiser takes issue with something, it will be deleted. Therefore, every community ends up being sanitized so as to avoid offending advertisers and their policies. I've seen site administrators purge their own community after Google turned off their ads because someone complained about one page.

[ikeboy]

To be clear, my comments were pointing out that what's described was not criminal. I didn't take a position on what's ethical or not.

That said, I think helping VPNs is a good thing ethically. If he'd been arrested for running a Tor node that was used to download child pornography (which has happened), I suspect most people here would defend him.

Helping spammers is bad, but, at least as described by OP, not illegal.

[Shacklz]

Thanks so much for calling this out, including the coarse language used, because in my opinion, it's really warranted.

We could do so many good things with technology, instead we use it more and more for bullshit to maximize profits instead of maximizing social value. It really is depressing really.

[amelius]

Imo, the basis of the problem is that we look at the GDP as a major health indicator of the economy, while this works against the idea that we should be consuming less, not more. From this follows adtech, and indirectly people being rewarded for doing stupid stuff.

[Koremat6666]

> Let's turn it into a dystopic market of bullshit covered in distasteful advertising,

I mean absolutely no disrespect to you and I understand your feelings are probably coming straight out your heart. However I would like to point out that when you say that the world does not meet your expectation and that somehow is a problem with the world and not your own self is very arrogant.

> But we can't have it, because we are selfish and short-sighted monkeys.

These distasteful comments about fellow humans are nothing but the same arrogant thought process that has caused havoc around the world through ideologies like communism and colonialism. It reeks of Rudyard Kipling's disgusting poem "White man's burden". Without knowing you are claiming that you have the power to know what is good for world and you only need power to fix it. In this process you actually get depressed. You are describing the world as "Fuck all this."

[normalnorm]

> I would like to point out that when you say that the world does not meet your expectation and that somehow is a problem with the world and not your own self is very arrogant.

Notice that this kind of argument could have been (and probably was) used against the abolition of slavery, the civil rights movement, universal suffrage, gay marriage or religious freedom. If you have a minority position against the status quo, you can always be accused of arrogance. "Who are you to think you know better?". However, sometimes the arrogant are right.

> These distasteful comments about fellow humans are nothing but the same arrogant thought process that has caused havoc around the world through ideologies like communism and colonialism.

And capitalism, don't forget. The ideology of infinite growth is destroying our habitat.

[polymatter]

fwiw I also agree entirely.

[TeMPOraL]

> I know a ton of bay area "startups" than engage in these sort of tricks to maximize the brand damage. (...) Half the companies with "explosive" growth were using mass mailing techniques than involved spamming. Many used foreign companies to skirt US law related to spamming.

Yes, I think we all know some. And it's true, skirting the law and abusing the commons gives one a competitive advantage. But that doesn't make it OK. The market isn't the arbiter of ethics. It only means that not enough is done to stop that behavior, that the border between legal and illegal is too low, or too misaligned with what's actually happening. That people still underestimate the extent to which money trumps ethics in everyday decision making.

[speedplane]

> skirting the law and abusing the commons gives one a competitive advantage. But that doesn't make it OK. The market isn't the arbiter of ethics.

Sadly, this is a bit naive, market have become the arbiters of ethics, namely: if it successful, it's good.

This isn't a traditional moral code from, e.g., Kant, Bentham, or Locke. Rather, it's an ethics based on capitalism.

Sure, wonky economics professors justify capitalism by saying it's the most efficient or provides the most utility, arguably grounded in traditional Bentham morality.

But capitalism has never simply been an economic policy, there has always been an ideological component to it (see for example, Ayn Rand). Maximizing returns on investment isn't just "efficient", it's "right".

[ikeboy]

See my comment at https://news.ycombinator.com/item?id=22361670

None of the things mentioned here are crimes, as far as I can tell. The crime they were actually charged with was using these shell companies to get more IP addresses than they were "entitled" to get. See the indictment at https://www.courtlistener.com/recap/gov.uscourts.scd.250342/...

[pdm55]

In support of your comment:

"As Micfo amassed VPN clients using the illegitimately-obtained IP addresses, a lot of traffic — some being criminal — filed through its network without a trace, according to government subpoenas directed at Micfo and reviewed by The Wall Street Journal.

Golestan and Micfo are not charged with being part of or even aware of illegal activity transmitted via VPNs across Micfo’s servers. The DOJ charged him and the company with “defrauding the internet registry to obtain the IP addresses over a period of several years.”

Prosecutors said Golestan’s alleged scheme was valued at $14 million, which was based on the government’s estimated value of between $13 and $19 for each address in the secondary market, according to the court complaint.

Born in Iran, Golestan, 36, started Micfo in 1999 in the bedroom of his childhood home in Dubai before emigrating to the U.S." https://www.pymnts.com/innovation/2020/secure-smart-cities-c...

[dragonwriter]

> None of the things mentioned here are crimes, as far as I can tell

The fake “Channel Partners” addressed in the article are paragraph 4 of the indictment. The article addresses some of the mechanisms by which they were used to evade legal process for the purpose of concealment, the indictment deals with the fact that they were used for that purpose. It seems preposterous to view those as unrelated.

[ikeboy]

>The article addresses some of the mechanisms by which they were used to evade legal process for the purpose of concealment

No, it doesn't. It says they responded to subpoenas for each entity.

>the indictment deals with the fact that they were used for that purpose.

Nope. The indictment is about using the shell companies to get additional IP addresses out of ARIN. It has nothing to do with any deficiency in responding to subpoenas, or any illegal use of the IP addresses by spammers, etc.

The article lists a bunch of things and either implies or explicitly says they are crimes, when none are. This includes having multiple shell companies, which is perfectly legal. Submitting false documentation for those shell companies is illegal, but is not mentioned by OP, presumably because they would not have been in a position to observe any of that documentation.

[dragonwriter]

> It says they responded to subpoenas for each entity.

It says that when a parent company agent was in possession of a warrant addressed to the parent company at the location of one of the fraudulent “Channel Partners” they were ordered to interact with law enforcement as if they were exclusively an agent of the “Channel Partner”.

Now, I suppose that could be argued to not be primarily intended to evade compliance with the warrant but instead to maintain the fraud of the independence of the “Channel Partners”, but either way it's a deliberate act in furtherance of a crime that could be separately prosecuted.

[ikeboy]

>the fraud of the independence of the “Channel Partners”

You still don't get it. The fraud was submitting false documentation to ARIN. Operating multiple shell companies is perfectly legal, as long as you don't submit false sworn affidavits and otherwise lie in the course of your activities.

Responding to a subpoena as the entity it was sent to isn't lying. It says there was one occasion where the subpoena had both Micfo and a channel partners' info on it, and he says he wasn't permitted to reach out to LEO to clarify.

Regardless, it's not an act "in furtherance of a crime" - the crime was committed at the point they obtained the IP addresses.

[dragonwriter]

> Operating multiple shell companies is perfectly legal

Sure, what's not is:

Having the registered principals of those shell companies be fictitious (as in this case).

Having agents of your company who have received a warrant addressed to your company pretend that your company has not received it, whether the purpose is to evade the warrant or to avoid drawing attention to your fraudulent front companiest (as, again, in this case.)

> Responding to a subpoena as the entity it was sent to isn't lying.

A subpoena or warrant is a command. Receiving it and not obeying the command fully is a crime.

> It says there was one occasion where the subpoena had both Micfo and a channel partners' info on

No, it says a warrant was addressed to Micfo but received by Micfo employees at the “Channel Partner”. It does not say it has both companies info on it. Even if it did, directing employees to pretend your firm has not received a court order naming your firm when in fact your firm has received it is not legal.

> Regardless, it's not an act "in furtherance of a crime" - the crime was committed at the point they obtained the IP addresses.

If the intent was to preserve the illusion of the distinct identity of the channel partners tonorent discovery of the fraud, it absolutely was an act in furtherance of the crime, and a knowing participant (that is, knowing of the purpose, not just the act itself) in it would, even if they had no other connection to the concealed crime, be an accessory after the fact.

[dylan604]

Every time I sign up for any kind of banking service (loan,credit,checking,etc), there's a note about by signing the document I am acknowledging that providing false information would be a bad idea. How is it not fraudulent to deceive potential investors by using false user data/stats? I've never read any investor agreements, but I'd assume there's some sort of similar statement/clause.

[ikeboy]

>How is it not fraudulent to deceive potential investors by using false user data/stats?

Where did that happen? It certainly isn't alleged by OP.

[sneak]

Thing is... you don’t “get” an IP address. Having ARIN reserve you a netblock in their database doesn’t get you anything that you didn’t have prior to them doing that.

IP “ownership” is not a real thing.

[notriddle]

That's... really irrelevant. The point is that they were using shell companies to trick ARIN into reserving more netblocks than normal.

[sneak]

If an ARIN reservation doesn’t get you anything, then tricking ARIN to get more of them isn’t fraud.

[nybble41]

It does get you something, though: the service of ARIN telling everyone that you "own" those addresses. Lying to someone so that they will perform a service for you is fraud even if you're not receiving any property. If you're running your own closed-off private network you can use whatever addresses you want, and I would agree with you that IPv4 addresses, as such, are not property. However, if you're connecting to the public Internet then your peers are going to care about whether the address ranges you claim were officially assigned to you by ARIN.

[saber6]

> [...] as far as I can tell.

It appears the law in this case feels differently.

The owners claimed under legal penalty that they had certain assets (paying customers, needs for IP addressing, etc). These statements appear to have been completely false. Thus, the trial.

And yes, lying to ARIN (or any RIR) about your customer base (need for IPv4 addressing) is just plain crappy. IPv4 addressing is a common resource - a 32-bit fixed address space - similar in concept to physical frequency allocation by the FCC.

There are 4.2B IPv4 addresses (minus some for RFC1918 and MCAST, etc). To lay illegitimate claim to them is really wrong, and more importantly, legally risky now.

[ikeboy]

No, they were not charged for any of the things claimed to be crimes in the article.

The trial is about different alleged wrongdoings than OP is going on about.

[dragonwriter]

> No, they were not charged for any of the things claimed to be crimes in the article.

Both a fraudulent system of shell companies and knowingly profiting by enabling spam are alleged on the article, and both have been the subject of criminal charges against the firm and it's CEO. [0]

[0] https://krebsonsecurity.com/2019/05/a-tough-week-for-ip-addr...

[ikeboy]

>knowingly profiting by enabling spam

Your source doesn't say that. I read the indictment and it doesn't charge them for "knowingly profiting by enabling spam".

[ganoushoreilly]

There's also other cases with charges pending, as well as a nasty Divorce case.

[ikeboy]

What other charges are there?

[ganoushoreilly]

Last I heard, the Fbi is going after him separately for wire fraud against multiple banks.

[saber6]

You sound extremely defensive with regard to this article — to the point that I am speculating whether or not you have vested interest in shooting down legitimate commentary.

You have responded to multiple comments with baseless FUD-like claims.

To which I contend.....

I smell Astro-turf!!!

[ikeboy]

I have no relationship to any of the entities involved. I'm just pointing out how clueless OP is.

And I was somewhat taken aback at how much pushback I got based on people completely misreading the article. It's one thing to disagree with me over what exactly is legal, it's another to start asserting that the company itself was running spamming services in the absence of any evidence. That surprised me. The government hasn't asserted it, the OP doesn't assert it, I can't find that claim anywhere but this thread.

[saber6]

This entity was a known spam shop. It took a while but someone finally put together a model showing the (what were thought to be) hidden relationships.

Don’t defend fraud artists dude.

[Spooky23]

Fraud.

You didn’t miss it. Everything after that first question were excuses for why it’s ok to break the law.

[Karishma1234fff]

Which law is being broken? Also (in my personal opinion) criminality should be obvious to a general person, some kind of complex technical illegality may not make the whole company a "criminal organization". A lot of reputed companies like Google get fined on regular basis world over does not make them criminal organizations.

A lot of companies would also willingly break the law depending on the risk tolerance they have, many of those laws result into civil penalties and not jail time for CEO so that also matters.

I was genuinely hoping OP worked from some underground enterprise that provided hitmans to rich people or something. La John Wick style. But thats just the romantic in me.

[Spooky23]

Misrepresentation when money or other tangible things are at stake is fraud. There are civil frauds and criminal frauds.

Say you needed to have a room added to your home. You approach a contractor, who talks about his past experience, and offers up several customer and trade references to corroborate this experience. You sign a contract, pay the 50% deposit, and the person disappears and doesn’t respond to your inquiries, nor those of the police.

You later find out that the customers were family members of the contractor, the trade reference was a Delaware corporation owned by the same Nevada corporation that cashed your check. In other words, the entire enterprise was a criminal enterprise constructed to defraud customers, not deliver.

That contrived example is an obvious series of frauds that is obviously a criminal enterprise. It’s easy to understand because the money was stolen. A case like this is a little different because the fraud was basically a scheme to get a constrained resource by lying about material facts to commit the fraud. IANAL, but my guess is the deliberate construction of these legal entities with no meaningful purpose elevated the matter.

[wpietri]

> criminality should be obvious to a general person

This standard would work for about 5 minutes before a criminal complicated things enough that their crime was no longer obviously wrong.

[TeMPOraL]

Indeed. Also, with apologies to Arthur C. Clarke: Any sufficiently complicated business model is indistinguishable from fraud.

[wpietri]

That's beautiful. And so very true.

I think the very best liars and fraudsters are the ones who they themselves don't know what's true. And what better way to not know than complexity!

[TeMPOraL]

That's related to Frankfurt's definition of bullshit[0]. If you purposefully say something that's not true, you're lying, but if you don't care at all whether what you say is true or not, you're bullshitting.

Complexity seems indeed very good at enabling bullshit - bullshitters caught spreading lies can just plead ignorance and point towards complexity.

--

[0] - https://en.wikipedia.org/wiki/Bullshit#Harry_Frankfurt's_con...

[dragonwriter]

> May be I missed it but can someone tell me what was the crime the company was committing ?

From the description in the article, obstruction of justice, at a minimum, possibly also with the intent of furthering other crimes and civil wrongs by the firm or it's customers.

> Almost any company will have defensive strategies such as stalling LEOs and Warrants in whatever way they can.

Many companies will do anything within the law to do this, which is, of course, not a crime. But “whatever way they can” is a crime.

> A lot of this is not really "crime" as in kidnapping people or shooting people dead in some alley.

Yes, obstruction of justice is a different crime than murder or kidnapping. It's just as real of a crime.

> Is having shell companies a crime ?

No, but using them fraudulently can be a crime and/or a civil wrong, and which has been involved in both civil liability already established against the firm and CEO in question and which is seems to be a key part of the mechanism of the fraud involved in the 20-count federal criminal indictment against them. [0]

[0] https://www.wsj.com/articles/fraud-case-in-charleston-s-c-sh...

[rblatz]

I read a few other posts on the authors blog and I think overthinking is a common issue for them.

The strangest one was they flew in for an interview the night before, got settled in at 11pm and decided not to sleep because they had to check out at 9am.