The FBI has dealt a blow to international organized crime groups by taking down Phantom Secure, a Canadian-based encrypted communication service.
Canada-based Phantom Secure was a criminal enterprise that provided secure communications to high-level drug traffickers and other criminal organization leaders. The group purchased smartphones, removed all of the typical functionality—calling, texting, Internet, and GPS—and installed an encrypted e-mail system, so the phones could only communicate with each other. If a customer was arrested, Phantom Secure destroyed the data on that phone, which is obstruction of justice under U.S. law. In an attempt to thwart law enforcement efforts, the company required new customers to have a reference from an existing user.
Most of Phantom Secure’s 10,000 to 20,000 users are the top-level leaders of nefarious transnational criminal organizations in the U.S. and several other countries, and the products were marketed as impervious to decryption or wiretapping. Phantom Secure’s founder and chief executive Vincent Ramos was arrested in Bellingham, Washington by the Australian Federal Police, Royal Canadian Mounted Police, and law enforcement agencies in Panama, Hong Kong, and Thailand.
It is the first time the U.S. government has targeted a company and its leaders for assisting a criminal organization by providing them with technology to “go dark,” or evade law enforcement’s detection of their crimes.
FBI Director Christopher Wray said: ” Phantom Secure allegedly provided a service designed to allow criminals the world over to evade law enforcement to traffic drugs and commit acts of violent crime without detection. Ramos and his company made millions off this criminal activity, and our takedown sends a serious message to those who exploit encryption to go dark on law enforcement. I want to thank our partners at the Department of Justice, as well as our Australian and Canadian law enforcement partners, for their incredible work on this case.”