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World's largest file-sharing website shut down; Megaupload leaders arrested

The individuals running Megaupload, the world's largest hosting site for pirated content, were arrested yesterday in Auckland, New Zealand, by New Zealand authorities, who executed provisional arrest warrants requested by the United States. The website was shut down.

The party is accused of operating for more than five years websites that unlawfully reproduce and distribute infringing copies of copyrighted works, including movies - often before their theatrical release - music, television programs, electronic books, and business and entertainment software on a massive scale.

Seven individuals, including three Germans, a Slovak, an Estonian and a Dutch, and two corporations - Megaupload Limited and Vestor Limited - had been charged in the United States with running an international organized criminal enterprise allegedly responsible for massive worldwide online piracy of numerous types of copyrighted works, through and other related sites. is advertised as having more than one billion visits to the site, more than 150 million registered users, 50 million daily visitors and accounting for four percent of the total traffic on the Internet. According to the FBI, the conspirators allegedly earned more than $175 million in illegal profits through advertising revenue and selling premium memberships and caused more than half a billion dollars in harm to copyright owners.

Law enforcement agencies in total executed more than 20 search warrants in the United States and eight countries, seized approximately $50 million in assets and targeted sites where Megaupload has servers in Ashburn, Va., Washington, D.C., the Netherlands and Canada. In addition, the US District Court in Alexandria, Va., ordered the seizure of 18 domain names associated with the alleged Megaupload conspiracy.

The individuals each face a maximum penalty of 20 years in prison on the charge of conspiracy to commit racketeering, five years in prison on the charge of conspiracy to commit copyright infringement, 20 years in prison on the charge of conspiracy to commit money laundering and five years in prison on each of the substantive charges of criminal copyright infringement.

The US Department of Justice communiqu%eacute; notes that the site was structured to discourage the vast majority of its users from using Megaupload for long-term or personal storage by automatically deleting content that was not regularly downloaded. The conspirators further allegedly offered a rewards programme that would provide users with financial incentives to upload popular content and drive web traffic to the site, often through user-generated websites known as linking sites. This constituted conspiring to launder money by paying users through the sites' uploader reward program and paying companies to host the infringing content.

This action is among the largest criminal copyright cases ever brought by the United States and directly targets the misuse of a public content storage and distribution site to commit and facilitate intellectual property crime.

A short time after Megaupload went dark the hackers community Anonymous reportedly brought down the websites of the US Department of Justice, the Motion Picture Association of America (MPAA), the Recording Industry Association of America (RIAA), Universal Music Group and several others with DDoS attacks.

Story filed 20.01.12

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