Oh the Irony, Pirate websites’ privacy compromised by Panama Papers



File sharing sites (often referred to as Pirate websites) make money from promising privacy to their customers. These kinds of companies are perfect for criminals. They allow pedophiles for example to upload and share child pornography. Now, thanks to the criminal actions of a hacker the Panama papers have had an unexpected consequence. They have compromised the privacy of customers who use Pirate websites like Mega.

Described as one of the largest leaks in history, the Panama Papers reveal where some of the wealthiest people in the world hide their fortunes. However, offshore companies are also widely used for anonymity, as the listing of two Megaupload defendants reveals. This could spell trouble for quite a few file-sharing sites and services that hide behind offshore companies.
This weekend an unprecedented database of over 11 million files leaked from Mossack Fonseca, the world’s largest offshore law firm.

The database was initially leaked to the German newspaper Süddeutsche Zeitung by an anonymous source. The newspaper then shared it which the International Consortium of Investigative Journalists (ICIJ), who involved hundreds of journalists around the world.

The reporting thus far has mainly focused on how some of the wealthiest people in the world used offshore companies to launder money and avoid tax. However, Mossack Fonseca is also frequently used as a privacy tool.

This explains why the names of two former Megaupload employees appear in the Panama Papers. As reported by Trouw, early 2010 Dutch programmer Bram Van der Kolk and Slovak designer Julius Bencko started a an offshore company with help from Mossack Fonseca.

Van der Kolk and Bencko are both wanted by the U.S. Government for their involvement with Megaupload. However, their British Virgin Islands-based company “Easy Focus Technology Limited” had nothing to do with the defunct file-sharing service.

In fact, Van der Kolk says that the reason to use an offshore company was to remain anonymous and hide their ties to Megaupload.

“The British Virgin Islands are for companies what Mega is for files: privacy, at least as long as the information does not leak from the trust office!” Van der Kolk says.

The pair didn’t want Megaupload boss Kim Dotcom to know about their side-project, as he might have objected to it. Nothing more than that.

“Not so much because our project was competing with Megaupload or that we could thus spend less time on Megaupload. More because Kim would never allow it in principle, and it would lead directly to an unnecessary escalation.”

This anonymity aspect is also crucial for a lot of names that appear in the Panama Papers. For example, many “pirate” sites use offshore companies to keep the owners out of the public view. This may help to avoid legal issues, for example.

This is believed to be one of the main reasons why several torrent sites, pirate streaming services and file-hosting companies are located in the British Virgin Islands, Cyprus, Jersey, Panama and the Seychelles.

…the privacy element will certainly have several other “pirate” sites worried that their owners may be exposed in the future. Thus far no public directory of names and companies have been released, but if that happens there is bound to be more panic.



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  • Effluent

    “…the privacy element will certainly have several other “pirate” sites worried that their owners may be exposed in the future. Thus far no public directory of names and companies have been released, but if that happens there is bound to be more panic.”

    If so, Hager’s source may turn out to have performed a valuable public service after all, even if inadvertently so. This would suggest that Fatty.Sausage may not be the source, in the case of the Panama papers, but that won’t stop me enjoying a measure of schadenfreude if he is exposed as the owner of a trust account in the Cayman Is.

    By the way, does anyone know yet where Hager’s trusts are based?

    • biscuit barrel

      Hager has to earn a living the old fashioned way, the state funded arts trough.

      “He is in Venice in his new temporary role as adviser and fact-checker for the NZ At Venice Biennale 2015 project which opens next Tuesday. It is called Secret Power.”
      Fair enough you might say, as you choke on that, as the installation is based on his book and Snowdens reveals.

      • XCIA

        CNZ is investing about $700,000 in the project and there is additional financial support from donors such as Te Papa and private patrons to the tune of around $300,000.” The curator of this project, Simon Denny said “Nicky Hager was presented to me by the team as a good option at the time because he wasn’t associated with any political parties, was independent and had a massive international reputation.”
        Perhaps the project should be renamed “DELUSIONS”.

        • Pete

          That is that is hard for this taxpayer to get enthusiastic about. CNZ has been an inessential burden for to long now. To use Mr Hager as a curator is not acceptable given his efforts at attempting to reduce the international reputation of NZ That Mr Snowdon is also involved should have alerted CNZ to the negative value of the proposal. I have doubts about both that do not lead me towards wanting to sponsor either in any manner.

          • XCIA

            Looking at their site, it appears that there is plenty more where that came from for this sort of nonsense. Perhaps a Royal Commission of Inquiry into this instead of the Panama Papers should be Peters goal.

          • Pete

            Piracy should not benefit the pirate in the long run and a tax funded agency should not endorse and reward it. For me the value in the Panama paper heap has been found in that it has exposed this nonsense and yes, at last, a matter that may merit either a commission of enquiry or simply a footnote in the budget that the previous allocation to Creative nz has been deleted. Surely the “arts” are a matter for private sponsors not a captive taxpayer.

        • niggly

          If CNZ is investing $700,000 into a narcissistic activist’s vanity project, which isn’t important in the wider scheme of things, then their funding needs to be cut and the money given to more worthy and deserving causes such as the health sector or community groups or for food in schools etc.