http://cbs11tv.com/local/Core.IP.Networks.2.974706.html

Wow. I hope no one here was affected.

This is insane, I do not live in US but it is still unclear to me how they managed to seize servers of all entities involved?
Did on warrant said: allowed to bust whole data center and not just specific entity which was suspected of leaking Wolverine movie?

Anyway this is disaster it would take weeks/months to get servers back.

Nice quote:
The state's asset seizure law doesn't require that law enforcement agencies file criminal charges in civil forfeiture cases. It requires only a preponderance of evidence that the property was used in the commission of certain crimes, such as drug crimes, or bought with proceeds of those crimes.

That's a lesser burden than is required in a criminal case. And it allows police departments and prosecutors to divvy up what they get from such seizures - what critics say is a built-in incentive for unscrupulous, underfinanced law enforcement agencies to illegally strip motorists of their property.

according to other news reports it was related to warez / distribution. If his personal home was raided as the story (video) on the site linked suggests. The FBI certainly believed that he was involved to some extent.

I've heard there was speculation that this is related to the X-Men origins movie being leaked.

Great to see that a movie leaking on the internet will get your data center raided, but heaven forbid the FBI use my tax money for something a *little* more constructive.

... nearly 50 businesses are without access to their email and data. Some of those clients provide internet services to car dealers and other companies.

... some residents' access to 911 is also being affected because some of Core IPs primary customers include telephone companies.



But that's ok, because Wolverine is safe ...

So, because you happen to be a neighbour, the cops get to bust you too.

I've heard there was speculation that this is related to the X-Men origins movie being leaked.

Great to see that a movie leaking on the internet will get your data center raided, but heaven forbid the FBI use my tax money for something a *little* more constructive.

You mean like buying copies of the constitution for internal reference?

we should all probably scan our networks and torrent sites to make sure none of our customers have tried to get wolverine... don't want to get raided :)

we should all probably scan our networks and torrent sites to make sure none of our customers have tried to get wolverine... don't want to get raided :)

They were after leaking source of that movie, don't worry maybe next time you will be lucky winner. This is joke of course but I hope you get my point. So this is even bigger disaster that they rather took down whole DC, than just cooperating with DC to identify and seize one server.

Isn't it amazing that what was treated as a civil matter is not treated as a criminal matter when powerful interests with powerful friends are involved.

Try reporting an auto theft sometime. Do *you* get a task force working on it? It's hard enough to get a copy of the report for the insurance company.

Even if owner was involved it will be better disallow access for him and all person who has relation with him if required to equipment and nominate own team to manage everything at least for time when investigation going.
Just simple example - small town power plant owner have been involved to something bad and FBI decide raid his equipment and stop it's work and leave city without electricity? Impossible i guess.

This is real? There is a authorization of a court to access into this datacenter? Who will pay all the losses?

I am from Europe and I am surprised all this.

This is real? There is a authorization of a court to access into this datacenter? Who will pay all the losses?

I am from Europe and I am surprised all this.





Wow I just saw this on slashdot and couldn't believe it either! I rushed over here to see if there was a big SH* storm going on.

Seems they did have a search warrant. however, I doubt the search warrant could possibly cover everything in the data center, even hardware belonging to separate companies. We'll see as the story evolves I guess.

"It's like an apartment building. If you have 500 tenants and one of them has a meth lab inside his apartment, they don't hold the apartment liable for that guys actions. But that's what the FBI is trying to do here," said Simpson.

Simpson also estimates 100,000 phone customers across Texas, and the country, are now without E-911 service, which provides dispatchers with information about where you're calling from.

"Citizen access to Emergency 911 services are being affected, as Core IP's primary client base consists of telephone companies."

The FBI will not say who is under investigation.

Currently nearly 50 businesses are completely without access to their email and data. And unfortunately for the companies who rely on those servers the FBI says it may be several days or more before their service can be restored.

surley you would play dumb saying you left your key card at home so you couldnt get into the server room :D

damn! i was hoping it was these guys:

Core Net Labs NET-97-107-232-0-21 (NET-97-107-232-0-1)
97.107.232.0 - 97.107.239.255

they are like some kind of spammer refuge with no response to anything..

This is beyond insanity.

The USA isn't looking so pretty for colo facilities right now. Wow.

I guess no-one on this forum was affected???

Matthew Simpson
Core IP Networks LLC

Dear Customers,

Today at 6:00am, the FBI conducted an unwarranted early morning raid of our 2323 Bryan Street Datacenters, on the 7th and 24th floors.

I received a phone call at 6:05am from our NOC that the entire network was powered off. I called Capstar Commercial and TELX, our landlord, and was told that the FBI was in the datacenter with a search and seizure warrant. I asked that the agent in charge call me immediately.

I received a call 15 minutes later from FBI Agent Allyn Lynd. Mr. Lynd would not tell me why he raided our datacenter or what he was looking for. He also accused me of hiding inside my house in Ovilla, Texas. I was actually in Phoenix, Arizona when this happened. I told him that, and he told me that he was "getting the dogs" after me, and hung up on me. I found out from an employee that there were 15 police cars and a SWAT team at my home in Ovilla.

The FBI has seized all equipment belonging to our customers. Many customers went to the data center to try and retrieve their equipment, but were threatened with arrest.

Neither I, nor Core IP are involved in any illegal activities of any kind. The only data that I have received thus far is that the FBI is investigating a company that has purchased services from Core IP in the past. This company does not even colocate with us anywhere, much less 2323 Bryan Street Datacenter.

Currently nearly 50 businesses are completely without access to their email and data. Citizen access to Emergency 911 services are being affected, as Core IP's primary client base consists of telephone companies.

If you run a datacenter, please be aware that in our great country, the FBI can come into your place of business at any time and take whatever they want, with no reason.

I can be reached for further comment at: mnsclec@gmail.com
Further information will be given as it becomes available.

Yours,
Matthew Simpson
CEO, Core IP Networks, LLC

(super post lengthener)

U.S. Federal Bureau of Investigation agents have raided a Dallas ISP, knocking the company and almost 50 of its clients offline.

The early morning Thursday raid closed down the operations of Core IP Networks, which operated out of two floors of a Telx collocation facility at 2323 Bryan Street in Dallas. The raid had to do with the activities of a former customer, according to Matthew Simpson, Core IP's CEO. "The FBI is investigating a company that has purchased services from Core IP in the past," he wrote in a note posted to a Google Sites page. "This company does not even collocate with us anywhere, much less 2323 Bryan Street Datacenter."

He did not name the company that is allegedly at the center of the FBI investigation.

http://www.pcworld.com/article/162584/fbi_raids_dallas_internet_service_provider_core_ip.html


I can't believe nobodys chatting about this yet this is pretty big news.

found out from an employee that there were 15 police cars and a SWAT team at my home in Ovilla.


Maybe they thought they were after the real Wolverine.

Wow, this is very, very disturbing. I believe I'd call up my House Reps and Senators to demand a solution...after I reported this to all the media outlets possible.

Wow, this is very, very disturbing. I believe I'd call up my House Reps and Senators to demand a solution...after I reported this to all the media outlets possible.
I'm getting in touch with my colo provider to see what procedures they have in place for something like this.

I suggest everyone else to do the same. I don't want MY facility caught off guard if anything like this happens again.

.. Guess we've got more to worry about than DMCA E-mails ;)

I'm getting in touch with my colo provider to see what procedures they have in place for something like this.

I suggest everyone else to do the same. I don't want MY facility caught off guard if anything like this happens again.

This is why its important to have backups and a disaster recovery plan. There is more than one way that your servers could cease to function.

This is what you call "normal" in America, government coming in an taking over businesses...

This is what you call "normal" in America, government coming in an taking over businesses...
cough *banks* cough.. ahem.

GM/OM (Obama Motors), AIG, Health Care...you name the business, and Obama/Government will try to get a piece of it.

Be careful about making any jokes in this thread that could be purposely misconstrued. In this particular case it appears the FBI has carte blanche approval to immediately shutdown a business and confiscate hardware in order to gain evidence (such as the IP address of a poster) if there is any hint that the poster knows something relevant.

But I simply can't believe this would be about a Hollywood movie. The government would only go to such extreme lengths if a major terrorist action were imminent justifying the extreme measures when time is limited.

If it is a Hollywood instigated raid, that would truly be sad for America. Makes me wonder now about the recent, sophisticated attack on WHT, or should that now be "attack" in quotes? This is a known way to hide/destroy your tracks if you are after evidence but do not yet have approval for a legal raid.

Be careful about making any jokes in this thread that could be purposely misconstrued. In this particular case it appears the FBI has carte blanche approval to immediately shutdown a business and confiscate hardware in order to gain evidence (such as the IP address of a poster) if there is any hint that the poster knows something relevant.

But I simply can't believe this would be about a Hollywood movie. The government would only go to such extreme lengths if a major terrorist action were imminent justifying the extreme measures when time is limited.


Nobody around here is worried about the gov'... We are all running the latest patches on our OS's and software to keep out such malicious attackers. ;)

i can't wait till they come out and say it was some kind of terrorist attack from the mid east, then american's would be ok with it and call it justified... </stupidity> this is america, they whisper "terrorism", we bend over and say "do whatever you want to do to me, just protect us." AND THEY HAVE TAKEN FULL ADVANTAGE!!! the fbi wouldn't do these stupid things if the media wasn't run by right wing nutcases

this is america, they whisper "terrorism", we bend over
Add to that anything in the name of "protecting the children", even if that means attacking the children to protect them (e.g., young kids charged as sex offenders for emailing pics of themselves to other young kids.)

Nothing good can come out of this.
If it's so easy to get a datacenter raided and get it inoperational think how you competitor can get a server with you (using fake data) and putting pirated movies on it and phoning the FBI.
Bye bye business and you had nothing to do with it.

Later Edit: I also forgot about NON USA businesses moving their dedis out of the US because they don't want to go offline because some kid uploaded a movie to a shared server of company X that happens to be in the same DC.
As of this month I'm starting to move my stuff.

But that's ok, because Wolverine is safe ...

So, because you happen to be a neighbour, the cops get to bust you too.
That's like taking down the whole neighborhood when someone's running a meth lab in their basement. :eek2:

March 12/2009, also DFW:

http://uwwwb.com/

WTF! That story is nuts, though I only read about 20%.

I read the whole story, although it took a while. It is just horrible.

I read that full story and I'm actually quite disturbed by this, and that the FBI can do so much damage to somebody and to their family. It's quite scary to be honest.

March 12/2009, also DFW:

http://uwwwb.com/

Wow. Just wow. If I ever have to colo something, I'll make sure it's not in the US.

That's like taking down the whole neighborhood when someone's running a meth lab in their basement. :eek2:

No. It's more like taking down the whole neighbourhood because someone alleges in vague terms that someone in the neighbourhood is storing goods that his friend bought at the flea market that might be bogus.

Actually, with the number of ip's and sites involved, it's more like putting a whole city under siege because someone alleged that a resident of a single apartment gave a fake Louis Vuitton purse to her friend. Now, the entire city is under martial lockdown until they manage to wring a confession out of somebody. In the meantime, should someone need to use 911, well too bad, the citizens are civilian casualties classified as justifiable collateral damage.

PS. If it *was* the Wolverine, why couldn't the copyright owner file a DMCA takedown notice like anyone else? The studio is in the US, the datacenter was in the US, and the owner was in the US. No lack of jurisdiction there.

missed the 15 minute edit window.

PS. If it *was* the Wolverine, why couldn't the copyright owner file a DMCA takedown notice like anyone else? The studio is in the US, the datacenter is in the US, and the owner is in the US. No lack of jurisdiction there. The DMCA was promoted and sponsored by the MPAA for exactly this purpose.

March 12/2009, also DFW:

http://uwwwb.com/

Ok, that's bad. Very very bad. Looks like America has sacrificed liberty in the name of... what? Certainly not in the name of security.

I'm getting in touch with my colo provider to see what procedures they have in place for something like this.

I suggest everyone else to do the same. I don't want MY facility caught off guard if anything like this happens again.

Like, uhh, what? Barricade the FBI out?

The only thing you can ask that your provider does is that they will inform you of the situation as soon as possible and that they have access to legal council who will immediately work to get the equipment back.

There is no QOS here, no guarantees, nothing like that... a court order to seize equipment has to be challenged in court.

It may not be just due to the movie, may be there could be some incidents linked to the place but, they could technically hijack equipment on site rather than take away to some place, and do research just like any sniffer provisions made by isp's for any purpose. this looks more like govt does not want this place to be running for whatever reason

I am from Europe and I am surprised all this. Depends on where in Europe you live I guess. :)

http://uwwwb.com/ Same FBI agent. Interesting.

this looks more like govt does not want this place to be running for whatever reason It looks like it's several places, and once it gets to that, can anyone consider his business to be safe?

It may not be just due to the movie, may be there could be some incidents linked to the place but, they could technically hijack equipment on site rather than take away to some place, and do research just like any sniffer provisions made by isp's for any purpose. this looks more like govt does not want this place to be running for whatever reason

It's all Bushs' fault

Seriously though, something doesn't add up here.

Damme this looks really nasty...


I already have remote backup and dns witch I can recover in less than 4-5 hours.

Looks like I will get another backup and dns just in case.


Now a days it's not only the normal threats and competition and non-paing clients you have to worrie about.....

need nano technology highly distributed arch and am not talking about simple cdn, a cdn of cdn type 100 nano servers serving sort of and which can not be taken down type. just degrade a little bit

Well now. Glad I don't have anything in Texas anymore. Damn : /

Seriously though, something doesn't add up here.

Agreed .. there's something smelly about it.

I have SaaS servers in two Dallas datacenters. After these impressive news I'm moving some servers out of Texas.

I have SaaS servers in two Dallas datacenters. After these impressive news I'm moving some servers out of Texas.

Because this is what the US needs in a time of crisis, and then they wander why.

Because this is what the US needs in a time of crisis, and then they wander why.

Long time Softlayer customers will remember FBI threats due a single server pinging a couple of American universities servers. The server owner was execrated by everyone in the private forum. The server was take down. After a lot of pression, nothing wrong after all.

Long time Softlayer customers will remember FBI threats due a single server pinging a couple of American universities servers. After a lot of pression, nothing wrong after all.
did i read that right? pinging?

I think there is nothing to be panic about. I heard this before, where FBI raided a datacenter due to child pornography and took the servers, etc but not at this scale. (I'm not saying that pornography is the reason why FBI raided Core IP Networks, since I really don't know). This raid can happen anywhere such in Florida, NY, LA, Iowa, Ohio and many other places where there's datacenter. It's just that this time, it happened in Dallas.

This is the reason why we have strict policy against pornography and gambling, etc for the sake of our customers peace of mind. I hope we all can hear the follow up news.

Ok, that's bad. Very very bad. Looks like America has sacrificed liberty in the name of... what? Certainly not in the name of security.

HAH, dont you remember? THE PATRIOT ACT!!!!

/me coughs the word "terrorism"

and yes, i do believe conspiracy theories, if it wasn't a conspiracy then we would have all our rights.

How about you guys quit raising the child pornography card all the time?

Any time there's an issue, the "get out of jail free card" is child pornography.

If there really would have been a child pornography case, (if FBI would actually really bother with this as nobody loses any money from this) rest assured FBI would probably plant packet sniffing devices or something in the datacenter and keep monitoring who accesses those servers, in the hope that they'll bring down more people involved in this pornography rings.

I've personally heard all the rumors possible, about child pornography, about servers used for "drugs communications" (another too much used reason), about some of the servers being used to spread the Wolverine movie that was leaked and several other reasons. They can give any reason, because they don't have to show anyone the papers - the owner didn't even know why the datacenter was raided - and if all above fail, they can very well use the Patriot Act or RICO and even arrest you and keep you in jail without process because they "think" you might be aiding terrorist or be part of some hidden terrorist cell in US.

My guess it would probably be the later, and my opinion is the the movie producers actually leaked the movie on purpose, as an excuse if the movie will fail at box office. There are lots of rumors on the Internet from people who went on previews saying that the story and movie sucked and that the action comic's characters are poorly represented. They actually went and filmed new scenes to make the movie better after early previews so that says a lot about it.

Either way, FBI abused their power by raiding and taking two floors filled with servers and equipment and raiding the owner's house. Seriously, was this person so threatening that they needed 15 police cars and swat teams at his house?

Did the FBI agent really need to threaten him on the phone even after the guy said he's not even in town?

Same thing as at this datacenter happened a few weeks ago with this guy here: http://www.uwwwb.com/

Swat teams surrouding his house, handcuffs, all the works, all servers confiscated, accounts blocked just because an ex employee lied about him.

In my opinion, you guys having hosting companies and datacenters should seriously consider forming an alliance of some sorts, perhaps along with EFF and other groups, and SUE the FBI and the judge who signed the warrant and whoever you can think of, and FIGHT this, and support these people who are about to lose their businesses because some crazy FBI agent decides to do whatever he wants.

The guy at the second link isn't even capable of defending himself properly, because of FBI's actions and if he can't defend himself these things will happen again and again, until no sane person would be interesting in hosting things in US and you'll go bankrupt.

It shouldn't be that hard to help them fight this by donating a few thousand dollars or maybe offer some lawyers you probably have on payroll already to help him out.

If you just let things like this happen all the time, it will only get worse.

true, there should and could be some kind of union AGAINST LAW ENFORCEMENT, nothing else. no pay this, no pay that and no health benefit crap they always try to get! although i dont blame the unions or like them, the datacenter one should be strictly from protecting themselves and customers.

If the FBI was looking for "something" specific, they wouldn't take the entire data center. What are they going to do... re-assemble all the pieces somewhere and power it up again and collect evidence ?

This stinks bigtime !

Does Core IP Networks have a website? I haven't seen them on WHT and from what I can see they are in a different market segment with about 50 telecom clients. I can't find them via Google.

FBI will not raid someone just because they want to or they don't have anything better to do. Because we don't know does not mean that we can comment that this is FBI's fault. They are people like us and they're just trying to do their job. It must've been quite serious. I just hope that someone will tell us what's going on so that we can learn and avoid it from happening.

I think there is nothing to be panic about. I heard this before, where FBI raided a datacenter due to child pornography and took the servers, etc but not at this scale. (I'm not saying that pornography is the reason why FBI raided Core IP Networks, since I really don't know). This raid can happen anywhere such in Florida, NY, LA, Iowa, Ohio and many other places where there's datacenter. It's just that this time, it happened in Dallas.

This is the reason why we have strict policy against pornography and gambling, etc for the sake of our customers peace of mind. I hope we all can hear the follow up news.

this case and raid has nothing to do with pornography as far as anyone knows so this is not something that needs to be brought into the mix.

The 2 sites affected appear to be:
coreip.net
txlink.net

They appear to have robots.txt blocking and are not showing in Google or post-2006 in archive.org

If this is over a civil case as is implied, then this is even more alarming. Since when does one get apprehended or attempt to for a civil case?

CBS 11 News has uncovered new information about FBI raids against Dallas companies that provide web servers for dozens of businesses in North Texas and across the country.

Court documents show it's all part of an alleged massive fraud scheme against AT&T and Verizon.

Court records show Verizon first went to the FBI this past January, alleging some North Texas web server providers were cheating them and AT&T out of millions of dollars.

Documents say AT&T and Verizon told investigators they believe they were being defrauded out of $6 million in a three to four month period by a group of investors working together, including Faulkner, Simpson, and three others.

The documents say those individuals profited more than $1 million.

In a phone conversation, Faulkner said, "The allegations that I defrauded AT&T and Verizon are ridiculous... The companies that owe money to AT&T and Verizon are clients and not owned by me."

Simpson said, "I'm not involved in alleged fraud against AT&T and Verizon, and I'm doing everything I can to cooperate with the investigation and to help my clients get back up and running."

http://cbs11tv.com/local/Core.IP.Networks.2.975776.html

The 2 sites affected appear to be:
coreip.net
txlink.net


I worked with owner a few years ago, so this could be out of date.

txlink is a small voip company. I believe core-ip is a rather small colo setup that houses mostly their gear, some asterisk servers, and a handful of customer boxes. I believe the owner had a login to almost every box hosted there.

If they suspected him/txlink of wrongdoing (telco fraud or similar wouldn't surprise me too much), it would make sense that they took out "all" of core-ip because it is probably just a couple extra boxes in the txlink cage.

* edit: To be clear, they might have expanded their colo side since then to provide more traditional colo, I don't know. But I wouldn't be very surprised if the distinction between customer and txlink gear was not documented anywhere but a couple spreadsheets.

* edit: I see from the link above they are saying it was their customers doing the fraud. Could very well be the case.

Wow. Just wow. If I ever have to colo something, I'll make sure it's not in the US.

So because the state of Texas has laws to allow such things and that there is only evidence of the Dallas Cybercrimes division over-stepping their bounds, twice now, somehow the entire US is unsafe or to blame for this somehow?? To me, this is a clear indication that you should not colo in the Dallas metro area, at least as long as Agent Lynd is in charge. We had seriously been considering expanding to Dallas ourselves, but these incidents have certainly made me question that.

I would like to note that my company has dealt with the Chicago Cybercrimes division on many occasions and all the people we have dealt with there do have at least a basic understanding of the industry. The primary agent we have worked with is clearly knowledgeable about the industry and has been extremely easy to work with. To even characterize these issues as an overall FBI issue is unfair, in my opinion.

Note: This is even assuming they over-stepped. We don't really have enough information at this point to determine that.

So because the state of Texas has laws to allow such things and that there is only evidence of the Dallas Cybercrimes division over-stepping their bounds, twice now, somehow the entire US is unsafe or to blame for this somehow?? To me, this is a clear indication that you should not colo in the Dallas metro area, at least as long as Agent Lynd is in charge. We had seriously been considering expanding to Dallas ourselves, but these incidents have certainly made me question that.

I would like to note that my company has dealt with the Chicago Cybercrimes division on many occasions and all the people we have dealt with there do have at least a basic understanding of the industry. The primary agent we have worked with is clearly knowledgeable about the industry and has been extremely easy to work with. To even characterize these issues as an overall FBI issue is unfair, in my opinion.

Well to be fair, I would probably not consider the US for colo in the first place. This story only reaffirms my stance. It's not the matter of 1 agent going crazy and doing things like this, and for all we know it might even be what they say it is (although until proven guilty, I am looking at it as not guilty), it's more the mentality of law enforcement in general coupled with very dangerous laws that give them an extreme amount of freedom to inflict tremendous amounts of damage in a very short amount of time with little to nothing one can do against it.

After all, once they take your stuff I doubt you will get it back at the very least for several days (probably a lot longer). And several hours of downtime can already cost you your business, let alone days.

In a phone conversation, Faulkner said, "The allegations that I defrauded AT&T and Verizon are ridiculous... The companies that owe money to AT&T and Verizon are clients and not owned by me."

This is Chris Faulkner as in the CEO of CI Host? Wow. That guy is always doing something. I used to have a colo in their Dallas DC, then moved it to their Chicago DC where things got better, until everything went offline due to a "bad router", which turned out someone broke in and stole a bunch of servers and equipment.

That company is very shady. They've been known to sue past customers for bad reviews and competitors.

So, what kind of web hosting organization, or, "union" would help protect hosters against unreasonable legal actions. Honestly it may be useful to put something together, if only a place to aggregate some resources that are relevant to the hosting industry and make them available to all. This sounds like something I've not really seen. Obviously WHT provides a place for people to come and discuss, but I'm thinking a place purely legally focused with more legit information then everyone's opinions. If there's a demand for such a site I'd be more than happy to donate some of my time and/or resources to get it going.

Well to be fair, I would probably not consider the US for colo in the first place. This story only reaffirms my stance. It's not the matter of 1 agent going crazy and doing things like this, and for all we know it might even be what they say it is (although until proven guilty, I am looking at it as not guilty), it's more the mentality of law enforcement in general coupled with very dangerous laws that give them an extreme amount of freedom to inflict tremendous amounts of damage in a very short amount of time with little to nothing one can do against it.

After all, once they take your stuff I doubt you will get it back at the very least for several days (probably a lot longer). And several hours of downtime can already cost you your business, let alone days.

I honestly don't recall any cases where a colocation facility was raided, yet those involved were actually innocent. The main one I recall is Foonet, where the former owner served jail time and the new owner fled the country and was on the FBI's Most Wanted list. I agree, it is bad for the customer's of those companies, but if there is illegal activity from those managing the company, why should they be allowed to continue profiting from operations based largely on illegal activity? Right now, we're saying due process wasn't followed when we have nothing close to the complete story and we have NO evidence that anyone that wasn't directly involved with the activities had anything seized.

Then saying this is a reason you wouldn't host in the US means you then wouldn't host in many countries in Europe either. There is the UK raid on Indymedia, German raid on Wikileaks, etc.

Right now, we're saying due process wasn't followed when we have nothing close to the complete story and we have NO evidence that anyone that wasn't directly involved with the activities had anything seized.

Yes, Matt Simpson/TxLink/CoreIP are all very interrelated. It is strange that this wasn't settled as a contract dispute between TxLink and the telcos, and there was some collateral damage.

However, this wasn't anything like one customer is suspected of leaking Wolverine and an entire building being shut down as it is being portrayed in a lot of places.

FBI will not raid someone just because they want to or they don't have anything better to do.
And we all know the FBI doesn't have a reputation for being overly aggressive, right? (cough-- 1993 Waco, TX-- cough)

The FBI acts with near impunity, casts a huge net dragging in everything in its path (including the innocent) and takes its time tossing back the fish it doesn't need or want, with little regard for the lives (or in this case, businesses) of those it's disrupted.

Just read history, folks. This organization is extremely heavy-handed.

Just wondering, what proof of overstepping do you see here? The only thing that is evident is equipment of the offending parties was removed, I have not heard a single thing of customer owned equipment being seized.

Perhaps I mis-read? I was under the impression they pretty much took everything.

Just wondering, what proof of overstepping do you see here? The only thing that is evident is equipment of the offending parties was removed, I have not heard a single thing of customer owned equipment being seized.
eh all of it? no charges being made, except allegations, the fact they ALLOW 911 calls to be disconnected is shameless, abuse of power, and many other reasons.

You cant simply disconnect peoples businesses and livelyhoods and not expect a reaction.

Who's going to be the first person to dial 911 and not be able to and sue ?

And unlike Vonage who was held accountable for the lack of E911 service a few years back (which was ironically also in TX, as I recall), who is going to be held accountable if someone dies because the 911 dispatcher did not have the location address information immediately available? ... all because the FBI took the equipment.

eh all of it? no charges being made, except allegations, the fact they ALLOW 911 calls to be disconnected is shameless, abuse of power, and many other reasons.

You cant simply disconnect peoples businesses and livelyhoods and not expect a reaction.

Who's going to be the first person to dial 911 and not be able to and sue ?

How about the company that chose to have no redundancy or backup plan for their E911 service? Wouldn't they be responsible, as they're the ones the service was contracted through?

The only business that appears to be critically damaged at this point seems to be the data center itself who seems has likely taken AT&T and Verizon for a couple million dollars... I agree, no one has been convicted, and I agree, this does seem somewhat like issuing a punishment before a trial. It does not seem though that this is as unwarranted as claimed, and it does seem the owner outrightly lied to the press, saying this was regarding a customer of their pirating things that left awhile ago, it has nothing to do with pirating. Simply put, as I said, we do not know all the details, and anyone either saying they're certainly guilty and deserve everything that is coming to them are jumping the gun just as much as those claiming this is a gross over-reach of the FBI, etc.

How about the company that chose to have no redundancy or backup plan for their E911 service? Wouldn't they be responsible, as they're the ones the service was contracted through?

The only business that appears to be critically damaged at this point seems to be the data center itself who seems has likely taken AT&T and Verizon for a couple million dollars... I agree, no one has been convicted, and I agree, this does seem somewhat like issuing a punishment before a trial. It does not seem though that this is as unwarranted as claimed, and it does seem the owner outrightly lied to the press, saying this was regarding a customer of their pirating things that left awhile ago, it has nothing to do with pirating. Simply put, as I said, we do not know all the details, and anyone either saying they're certainly guilty and deserve everything that is coming to them are jumping the gun just as much as those claiming this is a gross over-reach of the FBI, etc.

we dont know that Core IP lied about the reason..of it being a former customer as nothing has been official

it could be related to att it could not be...we dont know

Wow. I hope no one here was affected.

Whoa!! This reminds me of Foonet situation many years ago. Is pAUL back in business lol?

How about the company that chose to have no redundancy or backup plan for their E911 service? Wouldn't they be responsible, as they're the ones the service was contracted through?

To clarify your point a bit, the "company" was txlink, which is owned by the same guy. Shutting down the phone service side of things was likely the point of the raid, not something caught in the crossfire.

Whether the fraud was originated from txlink itself, or one of their [former] customers is the pressing question.

who is going to be held accountable if someone dies because the 911 dispatcher did not have the location address information immediately available

When you have a VOIP line there are lots of reasons your E911 can get cut off... you don't pay your ISP, your provider doesn't pay their upstreams, your provider's sole owner is raided by the FBI...

http://www.zattco.com/

ZattCo was recently affected by a major colocation outage caused by an FBI raid.
This raid was unrelated to ZattCo's operations or business, but we have been affected due
to our equipments' relative proximity to the offending group.

Our disaster recovery site, owned by the same colo company as the primary site, was also
raided, for the same reason - proximity to the offending group.

This is tantamount to arresting an entire apartment complex's patrons if a single resident
were guilty of running a meth lab.

We are working with the FBI and local Congress to remediate the problem.
Please call 800-606-9916 with any questions.

Google cache: http://www.google.com/search?q=cache:www.zattco.com/

My goodness. I am very sorry for these companies that are affected. Wrong association can be damaging. Maybe it is prudent to know your colo provider and what type of companies that host together with you in the same facility (or other space belonging to the same provider). FBI can do this everywhere in the US and although they are not perfect (none of us is), seems like (I hope) they are doing the best they know how.

Just wondering, what proof of overstepping do you see here? The only thing that is evident is equipment of the offending parties was removed, I have not heard a single thing of customer owned equipment being seized.

http://www.wfaa.com/sharedcontent/dws/wfaa/latestnews/stories/wfaa090403_lj_fbi.9d1539e2.html


We talked to several of the small, tech-businesses who are blacked out.

They're worried they'll lose their customers.

A small phone company in McKinney - Zattco - dropped off a hard drive at the FBI to recover some of its data.

But so far, they've gotten nothing.

http://www.wfaa.com/sharedcontent/dws/wfaa/latestnews/stories/wfaa090402_lj_fbi.96b29611.html

Locally, Classic Chevy lost its e-mail. A small ad agency is locked out of the internet and a small phone company-- Sitcom in McKinney-- says all its customers have lost service and access to 911.

http://www.dslreports.com/shownews/Is-Wolverine-Leak-Investigation-Causing-Collateral-Damage-101709?nocomment=1

A few companies who do business with Simpson have reached out to us to note that all they know is the raid seriously impacted their business. They haven't been told much of anything either, other than the fact that Core IP's lawyers are working with the FBI to get everybody back up and running.

"Our Residential DSL users, authenticate via PPPoE, using a RADIUS server we have hosted with Core IP," says Brent Waldrep, owner of Lightning Bolt Technologies. "Yesterday morning, around 7am, it was brought to our attention a few of our residential customers could not authenticate, and after some quick troubleshooting, we found our RADIUS server was not online," he says. According to Waldrep, a call to Core IP alerted them to the FBI raid.

"We sent out an email to all our residential DSL users, about 20% of our client base, informing them of the authentication issue," he says. He notes that users who were currently authenticated are still able to use their connection, though any users needing to re-authenticate, are not able to do so. Waldrep says he's giving impacted users a free upgrade to SOHO packages, which don't use the residential RADIUS server.


http://cbs11tv.com/local/Core.IP.Networks.2.974706.html

The FBI isn't commenting on specifics but said it could take several days to restore the servers of the affected companies. Officials say they could speed up their analysis of the web servers if the affected companies would contact them.

"Quis custodiet ipsos custodes?"

Maybe it is prudent to know your colo provider and what type of companies that host together with you in the same facility (or other space belonging to the same provider).
You'd have to be kept updated of every new client added along with their business details. That doesn't seem feasible.

If you're serious about business continuity planning, simply add a contingency to your disaster recovery plan that takes into account an immediate and complete data center loss and shutdown of the colo provider for whatever reason (natural disaster, accident, FBI raid, etc.) Ideally, you would have a warm or hot backup site hosted with a different provider out-of-state or off-shore with a continual syncing of data between locations. It may be a costly PITA, but it depends on how much you stand to lose if your online service goes down for an extended period of time.

Call me gullible but I think there's more to this than we know, things that the FBI isn't releasing for a reason. It may very well be that if they release more data on the search and seizure of Core IP, that some other investigation may be interrupted, uncovered or otherwise ruined.

And everyone who thinks the FBI is just bored and feels like tinkering around in someone's datacenter - really? There's obviously a legal process that has to be followed to get a search warrant. You could go around claiming that the magistrate and the chief investigator are all buddy-buddy with each other, but there's obviously some level of oversight. If there wasn't then what's stopping the FBI from doing whatever they please? I mean, without reasonable oversight they could just come and raid my house and disconnect my internet with no reaso




...Just kidding. But seriously. Speculation's not helping anyone. I know it's human nature to want to know all the juicy details but conspiracy theories just make you look like an idiot (Which is, oddly enough, proportional to the amount of exclamation points you use to end such an accusation).

I honestly don't recall any cases where a colocation facility was raided, yet those involved were actually innocent. The main one I recall is Foonet, where the former owner served jail time and the new owner fled the country and was on the FBI's Most Wanted list. I agree, it is bad for the customer's of those companies, but if there is illegal activity from those managing the company, why should they be allowed to continue profiting from operations based largely on illegal activity? Right now, we're saying due process wasn't followed when we have nothing close to the complete story and we have NO evidence that anyone that wasn't directly involved with the activities had anything seized.

Then saying this is a reason you wouldn't host in the US means you then wouldn't host in many countries in Europe either. There is the UK raid on Indymedia, German raid on Wikileaks, etc.

I think you're missing my point. I can understand that raids have to be done, on colo facilities as well as any other type of facilities. However, it is my opinion that the requirements to get legal backing for one of these raids are far too lax in the US. Someone just has to shout terrorist or child porn or something similar and everyone step aside and let the FBI or whoever else deals with it at the time do whatever they want.

Even if this guy did all of what he is accused for doing, was it necessary for the FBI to take ALL equipment? Including that of third parties who have nothing to do with this and confiscate it? This can cost people their business, especially in this time of crisis where many wouldn't be able to afford buying all of their equipment again to get up ASAP, but would have to wait until the FBI returns it.

And personally, I look at people as innocent until proven guilty. Not the other way around.

This is a pretty interesting story. The new reason is that someone owed AT&T and Verizon money. Kinda strange for FBI to be doing collection agency raids and even if someone owned someone else money isn't that a civil matter?

This is a pretty interesting story. The new reason is that someone owed AT&T and Verizon money. Kinda strange for FBI to be doing collection agency raids and even if someone owned someone else money isn't that a civil matter?

Yes, it is kinda strange. Slashdot's stories changed every day - first it was because the RIAA complained, next day it was the MPAA and now it's apparently because Verizon and AT&T want money. It just goes to show how reliable all the speculation is. I mean really, what are we gonna accuse them of next?

I'm all for "innocent until proven guilty" and that's still in effect because nobody's incarcerated. The point I'd like to make is that "innocent until proven guilty" doesn't mean diddly-squat when it comes to evidence. Servers have been confiscated as evidence - it sucks, yes, but we can't pass judgement on the FBI just yet, as we don't know the extent of the accusations or the scope of their investigation.

Servers have been confiscated as evidence - it sucks, yes, but we can't pass judgement on the FBI just yet, as we don't know the extent of the accusations or the scope of their investigation.

Evidence? Of what?

http://www.scribd.com/doc/13974347/mirror-of-wwwuwwwbcom-FBI-indiscriminate-actions-in-fascist-america


The FBI took an entire data center, hundred of servers, routers, switches, UPS system, cabinets, monitors, printers, and even power strips ... as evidence.

---

I actually got a copy of the 40 page affidavit they submitted to a federal magistrate to get the search warrants ... it's 90% outright lies, and 10% misrepresented truth. With a lot of "my experience as a special agent of the FBI for X number of years leads me to believe ..." as excuses for a warrant.

---

The guys actually put in the affidavit that it was alleged that I did crack cocaine and methamphetamines.

---

I don't smoke, I don't drink, I don't even partake in simple carbohydrates. I'm an athlete, and they made me out to be some deranged CEO dope fiend in order to get their bogus search warrant to invade my home.

---

Quote from Allyn Lynd:
"The way I ended up in Cybercrime is not all that glamorous ... In 1998, when we formed the Dallas regional squad, the powers that be asked if anyone knew anything more about computers then how to turn the power on, I raised my hand up and said that I played a lot of computer games and had put together PC's so that I could have a better gaming experience and the rest is history".

http://www.williamkwolfrum.com/2009/04/04/your-fbi-at-work/



Matthew Simpson
Core IP Networks LLC

Dear Customers,

Today at 6:00am, the FBI conducted an unwarranted early morning raid of our 2323 Bryan Street Datacenters, on the 7th and 24th floors.

I received a phone call at 6:05am from our NOC that the entire network was powered off. I called Capstar Commercial and TELX, our landlord, and was told that the FBI was in the datacenter with a search and seizure warrant. I asked that the agent in charge call me immediately.

I received a call 15 minutes later from FBI Agent Allyn Lynd. Mr. Lynd would not tell me why he raided our datacenter or what he was looking for. He also accused me of hiding inside my house in Ovilla, Texas. I was actually in Phoenix, Arizona when this happened. I told him that, and he told me that he was “getting the dogs” after me, and hung up on me. I found out from an employee that there were 15 police cars and a SWAT team at my home in Ovilla.

---

The FBI has seized all equipment belonging to our customers. Many customers went to the data center to try and retrieve their equipment, but were threatened with arrest.

So we now have to consider having non-us servers as backups or for takeover on failures to provide a reliable service.
Raid setups , off data center backups , offline backups , off-usa servers...


Also , when will we see the movie of this?
The local marshall struggles with the stubborn fbi agent, solves the mysteries of the raid, by convincing a former black hat hacker who is now an amish.

Did the affected company own the datacenter? Or are they just a single company in this datacenter with 50 businesses who were affected? Seems if an entire datacenter were shutdown it would affect thousands of users.

Our disaster recovery site, owned by the same colo company as the primary site, was also raided
that's a well thought out DR plan then !

I am not saying that WHT can sometimes take a little information and run way away from the facts.......Oh ya, that is what I mean to say. Right now most of the information in this thread is from a TV station and the owner of the company. Then we also have a provider in Chicago telling you that this means Dallas is too dangerous to host in. That is pathetic. Dallas has more raids than other markets because there is so much activity in Dallas.

No one has seen the actual case against Core IP or where the information came from. I know it is rough on the other companies that are affected by this just because they were mixed in with the "bad customer." This is no different than the hosting industry. If you are doing something that is "questionable" you mix it in with other legitimate customers so it doesn't look so bad. This is why spammers love the larger providers. Then they are just a small percent of the overall traffic.

Being in the Dallas market I have dealt with the local FBI Cybercrimes unit. I have always found them to be professional and detailed. I have seen them just ask for all records on a company and I have once seen them confiscate an entire customer's equipment. In that case the owner of the company did a bad thing and got caught. They had no choice but to remove all gear because they couldn't quite go to the owner and say, "Can you help us identify which servers you are operating illegally and which we should just leave here?"

Both of the cases mentioned seem odd to me that they actually went to the homes of the owners of the facility. This tells me there was enough proof that they were able to make a case for there being valuable information at the owners home, and that this was not a case of a cusotmer doing something wrong. If it was just a customer that was the problem they would have served Core IP to get their help in tracking the information. The FBI likely got the bank records some time in the investigation. We dont know what sums of money were changing hands. The money trail often tells a pretty good story of what is going on.

So, we have 7 pages of comments on this thread and no one has seen the actual case. When someone posts that lets all read it and go from there. For now, understand that from everything I have ever seen the FBI or any other agency only confiscates an entire facility when they have some proof that the owner is involved with the actual crime. I would bet that in this case the FBI had contacted the upstream providers for information some time leading up to this. With the information they had they decided that they had gotten as far as they could go downstream. Do you really think the Dallas Cybercrimes unit wants to confiscate any more servers than they have to?

that's a well thought out DR plan then !
Yeah they pretty much had everything covered with that plan.

Maybe the FBI just needed the hardware for Super Agent Lynd's new Cloud Gaming Network. They have to have something to do in between raids.

According to CBS, it seems that the FBI didn't go for Core IP's customers, but the owner of Core IP and maybe his partner.

Just like Paul said, Dallas FBI Cybercrime agent has been helpful, professional and courteous. In one occasion, they saved us from a fraud customer. As long as you are not against the law, you do not need to worry. I hope the truth will come up soon.

As long as you are not against the law, you do not need to worry.

I must disagree. America is transforming into a police state.

The correct would be: as long as you are against the law, you do need to worry.

It does look like their equipment was confiscated due to unpaid bills to verizon and at&t according to the latest from the local cbs station. http://cbs11tv.com/local/Core.IP.Networks.2.975776.html

It does look like their equipment was confiscated due to unpaid bills to verizon and at&t according to the latest from the local cbs station. http://cbs11tv.com/local/Core.IP.Networks.2.975776.html

You realize that doesn't make any sense whatsoever?

I know it is rough on the other companies that are affected by this just because they were mixed in with the "bad customer."
This was the sole focus of my argument-- that the FBI kicks down the doors (literally and figuratively) and drags everyone out by the hair-- the guilty and the innocent alike-- because nobody holds them accountable (unless something goes drastically wrong, then a token "investigation" is launched to appease the angry masses, which never amounts to anything).

I imagined myself in the shoes of the innocent bystanders who were unfortunate enough to colo at this facility and am thankful we're not colo'd there. It would be a public relations nightmare telling our corporate clients the FBI confiscated the servers hosting their accounting and CRM systems, while their operations sit paralyzed and their employees sit idle.

http://www.wfaa.com/sharedcontent/dws/wfaa/latestnews/stories/wfaa090403_lj_fbi.9d1539e2.html




http://www.wfaa.com/sharedcontent/dws/wfaa/latestnews/stories/wfaa090402_lj_fbi.96b29611.html



http://www.dslreports.com/shownews/Is-Wolverine-Leak-Investigation-Causing-Collateral-Damage-101709?nocomment=1




http://cbs11tv.com/local/Core.IP.Networks.2.974706.html

Ummm, which of those shows that someone else's equipment was seized? Yes, their service was affected, but from everything I can tell, the equipment was owned by Core IP or their affiliated companies, not by those customers.

That's brutal the extents the US goverment goes when it comes to copyright crap. It's retarded. They treat it worse then murder even. That's the last thing a DC needs in this financial situation. That is seriously going to hurt.

I think you're missing my point. I can understand that raids have to be done, on colo facilities as well as any other type of facilities. However, it is my opinion that the requirements to get legal backing for one of these raids are far too lax in the US. Someone just has to shout terrorist or child porn or something similar and everyone step aside and let the FBI or whoever else deals with it at the time do whatever they want.

Even if this guy did all of what he is accused for doing, was it necessary for the FBI to take ALL equipment? Including that of third parties who have nothing to do with this and confiscate it? This can cost people their business, especially in this time of crisis where many wouldn't be able to afford buying all of their equipment again to get up ASAP, but would have to wait until the FBI returns it.

And personally, I look at people as innocent until proven guilty. Not the other way around.

If what you're saying is true, where are all the examples? There is CP all over the Internet, thus there must be hundreds of these cases by now, where are they?

Was it necessary to take all the equipment? If all the equipment is owned by the party they're investigating, that does not seem to be completely out of the question. As I stated before, there is nothing indicating that any third party had their equipment confiscated, everything I've noted has simply stated people trying to retrieve their data, not their equipment, indicating the equipment was owned by Core IP or their related companies.

The effects of this would be the same if the building had been blown to hell or if an act of GOD had destroyed it. These days anything critical to a companies continuity needs to be spread out.

I hope this gets sorted out for those affected soon.

I am not saying that WHT can sometimes take a little information and run way away from the facts.......Oh ya, that is what I mean to say. Right now most of the information in this thread is from a TV station and the owner of the company. Then we also have a provider in Chicago telling you that this means Dallas is too dangerous to host in. That is pathetic. Dallas has more raids than other markets because there is so much activity in Dallas.


I know you're referencing me there, but are you even reading what I'm writing?? That post was made in specific defense of the US as a whole, that there is no indication this is a widespread issue outside of Dallas, which is true. All my future posts clearly indicated that I feel that there is no proof of any wrongdoing on the side of the FBI, we simply don't have enough information and have been indicating it is certainly possible the actions are defensible. However you get that I'm telling people it is too dangerous to host in Dallas is beyond me....

What I have been saying is in complete agreement with what you're saying, and you single me out as running away with the facts??

That's brutal the extents the US goverment goes when it comes to copyright crap. It's retarded. They treat it worse then murder even. That's the last thing a DC needs in this financial situation. That is seriously going to hurt.

This has nothing to do with copyright law...

Evidence? Of what?

http://www.scribd.com/doc/13974347/mirror-of-wwwuwwwbcom-FBI-indiscriminate-actions-in-fascist-america

You're taking the word of those being investigated as fact? They've already publicly stated this is about piracy and things that are 2+ years old when that is simply not the case. The FBI told reporters this investigation is regarding things from late last year, investigating started in January and it has nothing to do with piracy. It is pretty clear to me that these people want to mislead the community to get behind them, to put pressure on the FBI to hopefully get reduced sentences for themselves, etc.

I have an undying allegiance to the truth.. sorry in advance for hijacking..

And we all know the FBI doesn't have a reputation for being overly aggressive, right? (cough-- 1993 Waco, TX-- cough)

They waited 51 days to effect the siege. From where I'm sitting, the FBI showed reasonable restraint. The Justice Department were the "overly aggressive" ones, prosecuting women who never picked up a gun and never played any role in the underlying weapons charge. There were several instances of that, where these women served several years in jail as a result. Further, the whole thing could have apparently been avoided if not for the incompetence of the ATF, if you believe http://findarticles.com/p/articles/mi_m1571/is_n26_v9/ai_14021102/ . ATF agents are notoriously incompetent.. perhaps that's what is in play here with regard to the FBI/Core IP?

Regarding the broader issues, I'm convinced that based on the prima facie information, it would seem that this company and/or the named individuals are believed by the FBI to be involved in fraud, and/or conspiracy to defraud. Go ask any prosecutor, state or federal, the overwhelming majority will tell you that you must establish a pattern of fraudulent behavior, and/or establish circumstances in furtherance of a conspiracy (i.e. collusion, as in, the five people/entities mentioned in the CBS article get together once a week in the back of a Dennys restaurant and talk about how to milk a big ILEC for money). What I'm saying is that if you believe the reports, this is no accident and the FBI knows (or think they know) exactly what they're doing. So either one of two things will happen: 1) The individuals involved will get nailed, or 2) The FBI will have acted improperly and this incident will fold into the hate and rage that is already festering against the US government as a result of incompetence and foolishness at the top by our elected officials, and that rage will continue to spill over in the form of tea parties and other more militant events, like the murder of three police officers in Pittsburgh over the weekend because the actor thought Mr. Obama wanted to take away his guns. </runonsentence>

Long time Softlayer customers will remember FBI threats due a single server pinging a couple of American universities servers. The server owner was execrated by everyone in the private forum. The server was take down. After a lot of pression, nothing wrong after all.

ping? just because some university network admin didn't have a clue?

Really bad for anyone in the bulk monitoring business.

About 20 years ago I was on the wrong end of an FBI search and siezure in the state of Texas. 20 years later I am still surprised by how well they had their *stuff* together.

The locals would have thrown each and every one of us to the ground and then hauled us all in, siezing anything and everything that resembled what they came for. The FBI let my gf at the time and I roam around unabated and they knew EXACTLY what and who to grab.

Yes, it will make you crap your pants.

So we now have to consider having non-us servers as backups or for takeover on failures to provide a reliable service.
Raid setups , off data center backups , offline backups , off-usa servers...



Someone considering this would do well to think a liitle further.

Put everything some place else, and leave only reverse proxies on US soil to make up for the latency. The only thing that gets seized is the proxy servers. Or, writs delivered to content distribution networks. But, the real targets are theoretically beyond domestic jurisdiction, or at least, require more work to gat at.

This is the same setup that certain at risk industry segments started using during the last few years. That hosting business is gone forever now.

Ummm, which of those shows that someone else's equipment was seized? Yes, their service was affected, but from everything I can tell, the equipment was owned by Core IP or their affiliated companies, not by those customers.

But, the FBI is acting in the area of criminal law, and not as a bailiff on behalf of Verizon/ATT. Therefore, the machines they needed for forensics and evidence, if they needed them at all, did not include the customer machines. This is true whether or not they might be seized at some point as hardware assets in the future for non-payment of bills with respect to Verizon/ATT.

However, there is some advantage in seizing everything, if they are seized under proceeds of crime provisions. Who gets the proceeds when the assets are auctioned off? Will the disk drives be properly sanitized before sale?

One would suspect that two floors of equipment would entail having employees around who could identify equipment. That could have been a good option. After all, the employee has little incentive to get mixed up in a criminal investigation as a possible suspect when it is just as easy to hand over the keys to the kingdom and avoid being ensnared as a co-conspirator after the fact. Apparently, this was not the approach that was chosen.

But, the FBI is acting in the area of criminal law, and not as a bailiff on behalf of Verizon/ATT. Therefore, the machines they needed for forensics and evidence, if they needed them at all, did not include the customer machines. This is true whether or not they might be seized at some point as hardware assets in the future for non-payment of bills with respect to Verizon/ATT.

However, there is some advantage in seizing everything, if they are seized under proceeds of crime provisions. Who gets the proceeds when the assets are auctioned off? Will the disk drives be properly sanitized before sale?

One would suspect that two floors of equipment would entail having employees around who could identify equipment. That could have been a good option. After all, the employee has little incentive to get mixed up in a criminal investigation as a possible suspect when it is just as easy to hand over the keys to the kingdom and avoid being ensnared as a co-conspirator after the fact. Apparently, this was not the approach that was chosen.

So you're saying they should go off the word of the employees as to which equipment owned by Core IP may be used for illegal activities and which may not? Especially since I doubt most employees would not have any idea as to what specifically was being looked for, etc. Normally, I'd say yes, contact the host for more information, for more specifics, but here it is the host themself being investigated, thus they could not be trusted for providing that type of information.

If the FBI was targeting a customer of Core IP, then the FBI would probably have asked which server belong to so and so customer and Core IP will assist. However, since the FBI was raiding the Core IP itself, then they will seize everything under Core IP's roof that they feel can be used as evidence, just like in the crime scene. Which is also the reason why they searched the owner's house.

I think when the FBI agent reads this thread, they will have a good laugh. First, we are not the FBI and they know more than us on this case. A lot of our discussion here is based on guesses and speculations. I just hope that we didn't get too carried over and unjustly blaming the FBI. They have done a lot for all of us, whether we know it or not. Some of them even sacrifice their lives to protect us. I think we ought to be more grateful rather than to criticize them on the things that we didn't even know entirely.

Just a thought. :)

So you're saying they should go off the word of the employees as to which equipment owned by Core IP may be used for illegal activities and which may not? Especially since I doubt most employees would not have any idea as to what specifically was being looked for, etc. Normally, I'd say yes, contact the host for more information, for more specifics, but here it is the host themself being investigated, thus they could not be trusted for providing that type of information.

Reasonable application of logic could work. Just ask for an inventory of *every* machine. The ones which are identified as being those of an uninvolved third party are then subject to direct confirmation by the FBI on a party to party basis with the third party. The process of elimination then leads to a subset of unidentified machines which could reasonably be under suspicion. This, being a subset, is of course by definition less than all of the machines. As for the employee knowing what the FBI is looking for, well it's the FBI that's looking, so they ought to be able to express verbally what they are looking for. Perhaps they could read it right off the warrant sworn before a judge as being the specific, identifiable items being sought.


Normally, I'd say yes, contact the host for more information, for more specifics, but here it is the host themself being investigated, thus they could not be trusted for providing that type of information.

So, by extension, that means your own employess are not to be trusted to be truthful with law enforcement?

The whole basis of the argument put forth was that the employees, seeing the personal danger involved in interfering with a lawful warrant would put misguided loyalty aside in favour of enlightened self interest. If they don't know where their bread is buttered ... may their toast land butter side down.

The bottom line is, the FBI apparently failed to perform enough due dilligence to prevent (or at least minimize) the disruption of innocent businesses.

Take, for example, the Chevrolet dealer whose email is hosted there. The auto sales business is already on life support due to the economy, and now these poor folks have no email through no fault of their own.

Imagine if other innocent customers have their Accounting, CRM, or other critical apps hosted there. These are the innocent folks who couldn't conduct business right now and according to the news articles, the FBI says it will be at least several days before those servers are returned.

The COLLATERAL DAMAGE is what I have a big problem with.

However you get that I'm telling people it is too dangerous to host in Dallas is beyond me....

What I have been saying is in complete agreement with what you're saying, and you single me out as running away with the facts??

BTW Karl, I'm pretty sure Paul was speaking about your comment saying that you were thinking about opening a dc or doing colo in Dallas, and the recent events are making you re-think this, indicating that you think it is too dangerous to host in Dallas.

It is pretty clear in your initial posts on this thread. Paul will have to speak up on this, but this was my interpretation, and in this case, I would have to agree with his comments. You don't/didn't have all the details to make the assumption.

To me, this is a clear indication that you should not colo in the Dallas metro area, at least as long as Agent Lynd is in charge. We had seriously been considering expanding to Dallas ourselves, but these incidents have certainly made me question that.

This was the quote I was referring to. I think saying it was "a clear indication that you should not colo in the Dallas metro" is a little overboard. Maybe me saying "pathetic" was too. Throughout the rest of the posts we have been mostly in agreement. By the way, Texas law is not what permits this.

So because the state of Texas has laws to allow such things and that there is only evidence of the Dallas Cybercrimes division over-stepping their bounds, twice now, somehow the entire US is unsafe or to blame for this somehow?? To me, this is a clear indication that you should not colo in the Dallas metro area, at least as long as Agent Lynd is in charge. We had seriously been considering expanding to Dallas ourselves, but these incidents have certainly made me question that.


I think people are missing something here. It is alleged to be $6,000,000. This is a lot of money to steal. Let's all think about our own businesses and what it takes to make that kind of money. Now do it at 100% margin. Now imagine someone stealing that much from you. Can you hear me now?

The FBI is able to track money. If you track all of the money for several months, especially with the training these guys have, you are going to be able to put the real story together. Rest assured that this was not just an investigation where they looked at the data. Go back and look at your personal or business bank and credit card statements. They will say who you are and what you are doing.

As for the other people affected, if they were active WHT members they would have had it beat in to their heads about having backups. I do feel sorry for them, but I would think that people reading the articles are contacting those companies with offers to help. The equipment appears to be mostly property of CoreIP. Even if they didn't take it all you are still going to be down without the routers or power equipment. They aren't going to be responsible for staying at the DC and sorting out if some of the gear is actually owned by someone else.

As for the other people affected, if they were active WHT members they would have had it beat in to their heads about having backups. I do feel sorry for them, but I would think that people reading the articles are contacting those companies with offers to help. The equipment appears to be mostly property of CoreIP. Even if they didn't take it all you are still going to be down without the routers or power equipment. They aren't going to be responsible for staying at the DC and sorting out if some of the gear is actually owned by someone else.
But IMO you are still missing the principle of the matter.

We make backups. We transfer critical backups off-site. Ok fine, so the DATA is protected. But you still don't get it.

The innocent folks who (unwittingly) colocated their gear amongst a few bad apples are screwed either way. You cannot blink your eyes and have new servers magically appear. They have to be built and shipped.

And what about restore time? OS installs. Application installs. Then restoring all the data from backups. And if you were smart and did image-based backups that does full restores on bare metal, either the servers must be exactly the same hardware config, or the software must support bare metal restores on dis-similar hardware.

And how much is all this DUPLICATE equipment going to COST? Thousands. If more than a few servers were lost, then TENS of thousands or possibly six-figures. Who can afford that? Insurance does not reimburse for gear lost in the FBI's dragnet.

If the FBI had just brought down Core IP but left customer servers alone, at least these folks could have run down to pick up their gear and made a fast deal with another colo-- perhaps over the weekend, and maybe they would have been up for Monday's work day.

Again, my complaint is not the FBI taking down criminals, but the COLLATERAL DAMAGE they cause with near impunity.

Running a business hosted in the US is not a joke, this kind of thing can happen anytime in such a highly litigious atmosphere.

Having your site in more than one DC makes more sense every day. Its not enough to have backups, you need to consider the DC losing your entire server now.

Sekweta, I get it. I do this every day for customers. Each business needs to decide the levels of redundancy they want. We have many customers that this is their only site. Some that use a single power feed instead of redundant. Some that dont use HSRP even though we offer it for free. All of these things are choices that the customer must look at and decide how valuable the data is. No matter how much you spend you can always have something happen. Usually it is something that makes you say, "I didnt see that coming."

I have heard this referred to as paying for 9s. Each nine you add (99%-99.99999....%) costs you more money. You have to decide how many you want to buy. Some choose no redundancy and have been running fine for 5 years, while others choose to go fully redundant and got hit 3 months in because Murphy got invited to the party. I had a customer recently tell me that they would never buy redundant power even though we offer it. He has been up for 5+ years and said with the money he saved not paying for redundancy he will come out ahead. Not best practice, but a business decision/risk he was willing to make.

This will make some people stop and think about redundancy. I bet the car dealership spends a little extra on the IT department going forward. I think it will also cause some people operating in the "gray area" to straighten up.

I think we're on the same page, and I don't want to sound argumentative when my tone is actually "healthy debate".

What makes this whole episode so agregious is not that it was natural disaster, terrorist attack, power failure, hard drive crash, hacker, or burglar.

It was nothing more than the heavy hand of the FBI sweeping innocent customers into the dumper for the sake of catching someone else. It's like them running a bulldozer through MY house in order to take down a crack house on the block behind me.

Short of averting a national emergency, I cannot envision a scenario in my head that would have justified the wanton carelessness the FBI displayed in this sweep.

Actually, it is more like you living in the home of a drug dealer. Even though you don't know it, you are going to lose your stuff if the house is raided. You might get it back if you really didn't know.

Notice that the FBI didn't shut down Telx, or even take equipment from them. No executives got their houses searched. I would imagine that Telx, or maybe the upstream data providers, had been asked for information which pointed to Core IP being involved. You know this is bad for Telx too. They now have at least one suit that will likely be defaulted on. Also, we don't really know how much equipment there was. I see mention of 50 customers which be could anything from a single web server to thousands of square feet.

We all agree this is tough for the people around, but I think we also need to agree that without all of the information we don't really know if it was heavy handed or not. If you lost your equipment it will definately seem so, but if your data was on Core IP equipment there is really no other way than the FBI seizing all assets.

This was the quote I was referring to. I think saying it was "a clear indication that you should not colo in the Dallas metro" is a little overboard. Maybe me saying "pathetic" was too. Throughout the rest of the posts we have been mostly in agreement. By the way, Texas law is not what permits this.


The statement was in direct response to a specific quote to them not wanting to host in the US. My point with the post was to say it is not an entire US issue even if this all is true, that if you are worried about this stay away from Dallas, not from the entire US. I then went on in future posts to expand on that immensely, indicating I don't even believe at this point that there is enough evidence to say they did exceed their bounds, etc. Yes, if you take a single quote out of context I can see where you're getting that, my point is, look at the rest of the context.

As previously, I agree with everything you have said here.

The innocent folks who (unwittingly) colocated their gear amongst a few bad apples are screwed either way. You cannot blink your eyes and have new servers magically appear. They have to be built and shipped.


This is one of our disconnects. As I have pointed out numerous times, evidence points to all equipment having been owned by Core IP, making all their customers shared or dedicated hosting clients. Migrations of that type and size generally does not have a huge cost or a huge amount of data to back up, and as it was not their equipment, no equipment replacement costs, etc.

Wow that's ROFL funny.

Here's a good one, why don't the FBI go after the Warez sites that actually show the links ot the files and shut them down? Ya know the Warez sites that hundreds of thousands of members?

Here's a quick message for the FBI.
Your all pathetic and have no better things to do except go and steal some servers? Come on kids, it's a movie...
OR it was top secret military government plans and they just covered it up on the internet and the REAL story didn't leak.

We never hear the real story, only the part that the news is allowed to make out of the lies that the government tells them.

Idiot FBI...

This is one of our disconnects. As I have pointed out numerous times, evidence points to all equipment having been owned by Core IP, making all their customers shared or dedicated hosting clients. Migrations of that type and size generally does not have a huge cost or a huge amount of data to back up, and as it was not their equipment, no equipment replacement costs, etc.
If it's true that no colocated equipment belonging to others was taken, then you and I are in good agreement.

After reading....

"The FBI isn't commenting on specifics but said it could take several days to restore the servers of the affected companies. Officials say they could speed up their analysis of the web servers if the affected companies would contact them."

... I was left with the impression servers belonging to others were taken, and that in order to sort out who owns what, the affected companies needed to contact the FBI.

What in the hell does the FBI think they are? This looks like a case that could be thrown out of court for so many wrongdoings. Shame they could of gotten something but they messed it up. I wouldn't be surprised to hear agents being fired. BTW if you search EVERY FBI agent's home PCs you would fine warez and movies and music in the thousands!!!! Guilty all of them are. Let's go see what those agents have on their PCs.

Are you serious? FBI agents getting fired for this?

It'll never happen. Law enforcement takes care of its own.

If it's true that no colocated equipment belonging to others was taken, then you and I are in good agreement.

After reading....

"The FBI isn't commenting on specifics but said it could take several days to restore the servers of the affected companies. Officials say they could speed up their analysis of the web servers if the affected companies would contact them."

... I was left with the impression servers belonging to others were taken, and that in order to sort out who owns what, the affected companies needed to contact the FBI.

No I think you were right to begin with. I find it unlikely that a colocation facility owns every box on their floor. I am quite sure some were customer owned boxes. I don't find it unusual that they would grab everything and sort it out in a facility that they can manage so that they only release items after investigating it.

In terms of us all thinking the FBI are in the wrong and dumb blah blah.. I am quite sure none of them are going to tell us all what they were looking for and lay out all the evidence collected in their case except through disclosure to the defence (and not even then if they can avoid it) so we can all sit here speculating. :agree:

The situation sucks but is absolutely possible in any facility regardless of location.

Actually, it is more like you living in the home of a drug dealer. Even though you don't know it, you are going to lose your stuff if the house is raided. You might get it back if you really didn't know.

After I read that, I remembered the incident at PRQ, aka The Pirate Bay. The Swedish police raided their datacenter and took all of the servers, including the servers of customers that colocated with PRQ.

So if in fact Core IP was running a "shady" business, its not unprecedented for this to happen.

In terms of us all thinking the FBI are in the wrong and dumb blah blah.. I am quite sure none of them are going to tell us all what they were looking for and lay out all the evidence collected in their case except through disclosure to the defence (and not even then if they can avoid it) so we can all sit here speculating. :agree:
Coolraul,

Say, Jake is a criminal and he shot someone point blank. You are an FBI agent and you have the warrant to search Jake's house to collect evidence. When you arrive at Jake's house with your SWAT team, there are 50 guns and 10 of them belong to him while 40 of them belong to his friends. Will you take only the 10, or the entire 50 for forensic?

Coolraul,

Say, Jake is a criminal and he shot someone point blank. You are an FBI agent and you have the warrant to search Jake's house to collect evidence. When you arrive at Jake's house with your SWAT team, there are 50 guns and 10 of them belong to him while 40 of them belong to his friends. Will you take only the 10, or the entire 50 for forensic?

The difference between you living at Jake's house, and you colocating your equipment in a colocation facility is, it's widely known that colocation facilities primarily house equipment belonging to others.

It's unlikely there is a CRM system at Jake's house with a detailed inventory of personal property belonging to his house guests.

Knowing this was a colo facility, the FBI had foreknowledge that a portion of the equipment they were seizing belonged to others. No question about that.

And yet it appears they ignored the Fourth Amendment-- you know, that pesky little amendment to the U.S. Constitution which prohibits illegal search and seizure, which was crafted specifically to prevent the execution of overly-broad search warrants. But since when is the FBI concerned with the Constitution anyway.

The difference between you living at Jake's house, and you colocating your equipment in a colocation facility is, it's widely known that colocation facilities primarily house equipment belonging to others.

It's unlikely there is a CRM system at Jake's house with a detailed inventory of personal property belonging to his house guests.

Knowing this was a colo facility, the FBI had foreknowledge that a portion of the equipment they were seizing belonged to others. No question about that.

And yet it appears they ignored the Fourth Amendment-- you know, that pesky little amendment to the U.S. Constitution which prohibits illegal search and seizure, which was crafted specifically to prevent the execution of overly-broad search warrants. But since when is the FBI concerned with the Constitution anyway.
So, if you are the FBI agent, how would you do it?

The statement was in direct response to a specific quote to them not wanting to host in the US. My point with the post was to say it is not an entire US issue even if this all is true, that if you are worried about this stay away from Dallas, not from the entire US.


It would be a huge surprise to the FBI (Federal Bureau of Investigation) that their jurisdiction is constrained to Texas. Might be a surprise to a few citizens too.

Coolraul,

Say, Jake is a criminal and he shot someone point blank. You are an FBI agent and you have the warrant to search Jake's house to collect evidence. When you arrive at Jake's house with your SWAT team, there are 50 guns and 10 of them belong to him while 40 of them belong to his friends. Will you take only the 10, or the entire 50 for forensic?

If the warrant was specifically for a .32 calibre weapon, and there was also one or ten or twenty .50 calibre elephant rifles, then taking the elephant rifles would be beyond what is permitted in the warrant. It might be covered up later, it might be missed in the hoo-hah, but it is still illegal.

If it's true that no colocated equipment belonging to others was taken, then you and I are in good agreement.

After reading....

"The FBI isn't commenting on specifics but said it could take several days to restore the servers of the affected companies. Officials say they could speed up their analysis of the web servers if the affected companies would contact them."

... I was left with the impression servers belonging to others were taken, and that in order to sort out who owns what, the affected companies needed to contact the FBI.

It doesn't say "servers/equipment of affected companies" simply "affected companies" thus I would think that is more relating to data on Core IP owned systems, etc. I would have also assumed that by now someone whose equipment was taken in this would have made some kind of public statement, yet I have not seen any.

It would be a huge surprise to the FBI (Federal Bureau of Investigation) that their jurisdiction is constrained to Texas. Might be a surprise to a few citizens too.

So you're then saying the Dallas Cybercrimes division operates throughout the US? That is specifically what my comment was referencing, though nice try...

If the warrant was specifically for a .32 calibre weapon, and there was also one or ten or twenty .50 calibre elephant rifles, then taking the elephant rifles would be beyond what is permitted in the warrant. It might be covered up later, it might be missed in the hoo-hah, but it is still illegal.

Correct, and what here lends you to believe that the warrant wasn't for all of the equipment in the data center?

Then you're also saying that if the FBI were to only take Core IP equipment they should trust Core IP themselves as to which systems were theirs and which weren't? If they did have servers of their own with proof of illegal activity, you don't think they'd do anything to hide it, like possibly simply labeling it as belonging to a different customer, or a customer who doesn't really exist, etc.?

The analogy I think that works for this is:

If you live in an apartment building, and there was rampant crime originating from that building, such that the local police were led to believe the building was simply an organized crime ring. Because of this, the police go through and thoroughly question all the residents and ask them to go "downtown" for a couple hours of questioning regarding all those events. They are taking that person's time, even though there is no proof they're directly connected, but they may have valuable information in the case. Similarly, these other systems are being held for questioning.

I can personally confirm that equipment not owned by coreip was also taken. We had numerous servers confiscated and no eta as to if/when we'll get them back. We rerouted our affected customers to other equipment.

That equipment is being detained and analyzed for longer than 2 or 3 hours. How about the innocent bystander is detained for 5 days, not allowed to work, and sometime "soon" if enough of your friends, family and bill collectors call to vouch for your credibility they will release you in a week or so.

I seriously doubt the electric, phone, mortgage company really cares that you were detained by the FBI for weeks, you still have to generate income to pay them on time or else it cost's you more money.

Correct, and what here lends you to believe that the warrant wasn't for all of the equipment in the data center?

Then you're also saying that if the FBI were to only take Core IP equipment they should trust Core IP themselves as to which systems were theirs and which weren't? If they did have servers of their own with proof of illegal activity, you don't think they'd do anything to hide it, like possibly simply labeling it as belonging to a different customer, or a customer who doesn't really exist, etc.?

The analogy I think that works for this is:

If you live in an apartment building, and there was rampant crime originating from that building, such that the local police were led to believe the building was simply an organized crime ring. Because of this, the police go through and thoroughly question all the residents and ask them to go "downtown" for a couple hours of questioning regarding all those events. They are taking that person's time, even though there is no proof they're directly connected, but they may have valuable information in the case. Similarly, these other systems are being held for questioning.

Bingo! :) Very well said! I believe the FBI would not want to take more than they have to. But it's because the evidence can be hidden anywhere in any servers whether it is labeled as customer's or not (or even computer in the house), the FBI is doing what is necessary in this case. $6,000,000.00 is a lot.

That equipment is being detained and analyzed for longer than 2 or 3 hours. How about the innocent bystander is detained for 5 days, not allowed to work, and sometime "soon" if enough of your friends, family and bill collectors call to vouch for your credibility they will release you in a week or so.

I seriously doubt the electric, phone, mortgage company really cares that you were detained by the FBI for weeks, you still have to generate income to pay them on time or else it cost's you more money.

Data, which should be backed up, should be significantly easier to recover than 3-4 hours of your life... If your DR plan involves you being down for DAYS, that is your fault, not the FBI's. This is WHT, the land of "Where are your backups?" and you're saying the FBI is solely to blame for days of downtime? Honestly, if you don't keep off-site backups of your data, then that data must not be valuable and easily recoverable. If that isn't the case, you're the one to blame.

Here is a link to the application for the search warrant:

crimeblog.dallasnews.com/2323%20Bryan.pdf

won't let me post the full link with under 5 posts..

I would have also assumed that by now someone whose equipment was taken in this would have made some kind of public statement, yet I have not seen any.

http://www.webhostingtalk.com/showpost.php?p=5981332&postcount=81


ZattCo was recently affected by a major colocation outage caused by an FBI raid.
This raid was unrelated to ZattCo's operations or business, but we have been affected due to our equipments' relative proximity to the offending group.

Here is a link to the application for the search warrant:

crimeblog.dallasnews.com/2323%20Bryan.pdf

won't let me post the full link with under 5 posts..

The steps seem pretty clear. Core IP was directly involved, having paid for a circuit, that was used/received fraudulently. It also then seems Core IP, a small firm with a small number of customers, had multiple "customers" all involved in the same detailed fraud scheme... Doesn't seem to be any jumping to conclusions on the FBI's part here....

Data, which should be backed up, should be significantly easier to recover than 3-4 hours of your life... If your DR plan involves you being down for DAYS, that is your fault, not the FBI's. This is WHT, the land of "Where are your backups?" and you're saying the FBI is solely to blame for days of downtime? Honestly, if you don't keep off-site backups of your data, then that data must not be valuable and easily recoverable. If that isn't the case, you're the one to blame.

In one you were right like it is not enough that from time to time natural disasters happen in state of Texas, but now FBI can seize everything that can find. I wonder how much would insurance companies charge premium for insurance for interruption of business routine caused by the FBI.

I'm sorry for customers this will take months to resolve, and nobody could give them back their lost reputation, time and money. I know some of you would say that their customers should in depth check reputation of that colo-company, but this can help to anyone.

The steps seem pretty clear. Core IP was directly involved, having paid for a circuit, that was used/received fraudulently. It also then seems Core IP, a small firm with a small number of customers, had multiple "customers" all involved in the same detailed fraud scheme... Doesn't seem to be any jumping to conclusions on the FBI's part here....

1st page of the document:

In the Matter of the Search of:
2323 Bryan St. Cabinet 24.02.900

How does that include the entire data center? Am I a customer of CoreIP, yes. Do I think coreip is in the wrong? No, but can be convinced otherwise if there is proof of wrongdoing. I know there is nothing out of the ordinary on our servers and hope they are returned expeditiously.

In one you were right like it is not enough that from time to time natural disasters happen in state of Texas, but now FBI can seize everything that can find. I wonder how much would insurance companies charge premium for insurance for interruption of business routine caused by the FBI.

I'm sorry for customers this will take months to resolve, and nobody could give them back their lost reputation, time and money. I know some of you would say that their customers should in depth check reputation of that colo-company, but this can help to anyone.

That is what DR plans are for. If they didn't have them, that is their own fault. Sorry, but those are the facts.

In addition, if you'll read the warrant, etc. you'll see that the warrant was clearly justified.

1st page of the document:

In the Matter of the Search of:
2323 Bryan St. Cabinet 24.02.900

How does that include the entire data center? Am I a customer of CoreIP, yes. Do I think coreip is in the wrong? No, but can be convinced otherwise if there is proof of wrongdoing. I know there is nothing out of the ordinary on our servers and hope they are returned expeditiously.

That is a TelX cabinet, which if you read the entire things, is stated as having not been paid on and that TelX was unable to inform them of being kicked out, etc. They certainly did not do a full RAID of TelX, or we'd be hearing a LOT more about this...

The primary space that equipment was located at is 1950 Stemmons, Suite 2045, where it seems they operated ~24 cabinets, many of them with no customers or minimal use.

Please, actually read it before making such statements...

Nice... they describe the location of the search the exact cabinet with lots of details, including the color, and then specify a long list (16 points) of stuff they can take...

From the search warrant annex B:

2. Electronic storage devices which consist of all equipment which can collect, analyze, create, display, convert, store, conceal, or transmit electronic, magnetic, optical, or similar transmission, reception, collection and storage of data. Electronic storage device includes (but is not limited to) any wireless/cellular telephone, cordless telephone, pager, fax machine, digital camera, audio recorder, video recorder and any data-processing device e.g. central processing units, memory typewriters, self-contained "laptop", "notebook", "mini-notebook", or "personal data assistant" computers.
[..]
5. Related communication devices e.g. modems, cables and connections, recording equipment, RAM and ROM units, acoustic couplers, automatic dialers, speed dialers, programmable telephone dialing [...] Any device, mechanism, or parts [...] physical keys and locks bio metric readers, retinal scanners, facial recognition, signature verification, smart card or voice authentification.


It looks like they really specified in fine detail exactly what they had to take from the datacenter.

What's a cabinet? Is it a 47 unit rack of servers or some kind of room where you have your racks? If it's the first, how can they specify the location that rack and then take out so many servers...

Nice... they describe the location of the search the exact cabinet with lots of details, including the color, and then specify a long list (16 points) of stuff they can take...

From the search warrant annex B:


It looks like they really specified in fine detail exactly what they had to take from the datacenter.

What's a cabinet? Is it a 47 unit rack of servers or some kind of room where you have your racks? If it's the first, how can they specify the location that rack and then take out so many servers...

And this is the warrant for only one site, there are several other sites warrants were requested for, as noted in the document. Overall, the document confirms my overall opinion of the thoroughness of the FBI, that they simply weren't grasping at straws here...

Having read the entire search warrant from beginning to end I must side with the FBI here.

Premier VoIP, LLC appears to have knowingly provided falsified documents to Verizon and AT&T in an attempt to deceive for the purpose of financial gain. I'd call this fraud, but even if it's not the legal definition it's still skirting the edge.

Page 15, number 16 states:
"Once investigators suspected fraud, investigator Cooke reviewed the wire transfer information for the surety payment. Verizon officials determined the sending company was not Lone Star Power but Core IP Networks LLC. Further, since October 2008, Verizon officials reported that the invoices for the Lone Star Power LLC account are now several hundred thousand pages long. October's invoice is 188,561 pages, November's is 389,852 pages, December's is 350,604 pages, and January's is 293,689 pages. LoneStar has not paid any of these bills. Verizon has since cut off Lone Star Power's service, but LoneStar Power owes Verizon $2,204,923.47 for services rendered."

The FBI is fully in the right here. Wire fraud is wire fraud. If the allegations are true, Core IP Networks LLC was directly taking part in defrauding Verizon and AT&T.

Regardless of backups or not, they (FBI) are directly responsible for the downtime of the innocent customers. I don't think the phone company and the Chevy dealer were involved in any illegal activity. I am also pretty sure that the FBI knows 100% that they are not, however those customers are down and so are their customers and that cost money.

Yes DR plans are certainly not in place, if they were, they failed and that is not the FBI's fault. Some clients can not afford to mirror hardware while other clients have no idea what the value of their data is until it is gone.

None of the affected clients asked the FBI to raid the facility. The FBI took it upon itself to conduct the raid after "extensive investigations" and "should" know exactly what they are looking for. It is obvious that the investigation was not extensive at all and the raid is designed to "flush out" the bad guys along with the good guys. The good guys have to pay?

Here is a link to the application for the search warrant:

crimeblog.dallasnews.com/2323%20Bryan.pdf

won't let me post the full link with under 5 posts..

Beware users of dedicated servers and remote backup. :rofl:
Pages 28-29

Based on my experience, I know that when subjects maintain commercial mail boxes near their home, they often take mailing and other records from that location to their residence. It is also my experience that in the computer networking / service providing market, maintaining a mail box as a business address is often done if the business owner / operator is working from home, but does not want his presonal address known, especially when that remailer is located near their home.


On February 5, 2009, Verizon officials told me that in addition to the corporate accounts, Faulkner has a residential account with Verizon. Through Verizon, Faulkner had a Fiber Optic connection to his house... According to Verizon officials, Faulkner's account appears to have unusual bandwidth usage.

On March 5, 2009, Verizon officials provided me with more detailed records of Faulkner's network usage. From the records provided, I could see that Faulkner had approximately five (5) times as much outbound information as he did inbound information. This is atypical. A usual home user generally has an order of magnitude (10 time or so) more outbound traffic then inbound traffic. A home user who connects to the Internet and asks for a Web page sends a small amount of information out and receives a large amount of information in return. Based on my knowledge and experience, this type of bandwidth usage is associated with and not uncommon among those individuals dealing in pirated software and movies, operating SPAM servers, or remotely administering computer networks. This information is also consistent with the witnesses information that Faulkner conducts business from his residence. Further, in my interviews with property management at 1950 Stemmons, I was told that Faulkner, and others, only come into the office about once a week. In my experience, again, this, coupled with the information above, is consistent with Faulkner running part of the business from his residence.

56. I also believe there is evidence of the wire/mail frauds of AT&T/Verizon as well as evidence of piracy and the canSpam violatons at Faulkner's residence at ... I believe this because the witness I interviewed about Faulkner indicated that Faulkner claimed to have routers at his residence.

Very interesting search warrant. I'd definitely side with the FBI... they certainly wove a tangled web of businesses.

It sucks for the legitimate businesses who were put out, but got to be careful who you do business with and plan for the worst too. This kind of thing definitely has me thinking more about that kind of disaster recovery. Hopefully they all get their stuff back quickly.

Bingo! :) Very well said! I believe the FBI would not want to take more than they have to. But it's because the evidence can be hidden anywhere in any servers whether it is labeled as customer's or not (or even computer in the house), the FBI is doing what is necessary in this case. $6,000,000.00 is a lot.

To AT&T or Verizon, that is a drop in the bucket. Preventing small businesses from accessing their data for days at a time has potentially more severe consequences. (comparatively speaking)

I believe in punishing criminals, but armchair quarterbacking this, it seems the FBI should have done more due dilligence so as to minimize disruption of innocent businesses. Clearing out an entire colo-- customer equipment, along with the host's equipment-- seems pretty hard to justify, if this is just over some money owed to a telecom.

56. I also believe there is evidence of the wire/mail frauds of AT&T/Verizon as well as evidence of piracy and the canSpam violatons at Faulkner's residence at ... I believe this because the witness I interviewed about Faulkner indicated that Faulkner claimed to have routers at his residence.

Those damn Cisco 2800s... I knew they were behind all that spam! Grrr... With that logic, God only knows what a CRS-1 is capable of!

But no, seriously... everybody who's whining about all the innocent clients, I know where you're coming from on this but you have to understand one thing - their host has been accused of millions of dollars worth of wire fraud. There will undoubtedly be a seize on all of Core IP's bank accounts.

What does that mean? That means that even IF the servers were placed back in the datacenter, no one would be able to pay the bills, and they'd all be right back where they started.

Face it, you're gonna have to find a new host anyway - might as well start looking right now!

You never know how they got the car dealer for a client. It could be that the IT guy there is a friend of someone involved. In this case the FBI has to hope that a car dealership has plans if a disaster happens. If they didn't they need to fire the IT guy, or the person that wouldn't give him the budget. If you want to blame someone blame the crooks for putting companies at risk by hosting them next to their fraud.

Also, in reading this you know this didn't happen over night. The investigation goes on until they feel that digging further will cause them to tip off the criminal. Now comes the fun part. You have several people that likely have a pretty nice lifestyle. Haven't you heard the old saying "There is no honor amoung theives?" Someone will start singing if they haven't already. Maybe the former employee gave them enough that they dont need to take pleas.

I think it is time for some people to realize that this wasn't as bad as everyone thought. If the case would have been posted by the OP originally this would not have taken the path of blaming the FBI. I now understand why the games were taken.

Your a bit off. The affidavit is from the search of my house and data center weeks ago, not the Core IP and Matt's house Raid, which was last week. All of my personal bank account, my employee bank accounts, and Matt's business and personal have been seized. Regardless of the fact that we could and did easily prove all of our income was from legitimate sources. The point was to decapitate any chance we had of a legal defense. I have not seen the Affidavit for the search of Core IP yet.

And by the way, the affidavit is complete BS. It doesn't even make sense from one page to the next. They listed many of my companies client companies, partner companies, and even vendors as if it was all one big conspiracy to steal phone service...it's ludicrous. My full story is at u w w w b . c o m

Neither myself, or anyone else I know that is involved ever did anything illegal to my knowledge. But either way, even if we were selling mad digital crack, the FBI did no investigation...they just destroyed hundreds of business without cause.

They said their informant said we had no customers, which is amazing, considering they seized our bank accounts...which is where they could have seen payments from hundreds of legitimate clients going back for over 5 years.

Once again, no investigation, and no effort whatsoever. They just shut down the networks and loaded up the equipment. Customers that showed up at my data center were threatened with arrest.

They are going to great efforts to prove we had some additional relationship with the businesses of our clients that they say owed AT&T or Verizon, beyond the client vendor/relationship. They said that they tracked everything back to us by IP Addresses and Phone Numbers, which of course we assign to clients. They weren’t even remotely interested in who was assigned what IP Address and/or Phone Numbers. They are happy with their big conspiracy theory, which is ludicrous, insane, and total BS.
More to the point, they have easily done 10x the damage of even the most ridiculously inflated carrier bill. That, and they destroyed my business, took all my money, put my employees out on the street, and scared the hell out of my kids…apparently on behalf of AT&T and Verizon.

If you own a data center, be advised, the FBI doesn’t understand collocation. They are clueless when it comes to VoIP, and they are going to send a heavily armed SWAT team into your home at 5:00AM as soon as you have a client that screws with one of the big companies they apparently do collections for. Believe that.

And by the way, the cabinet listed in the affidavit at 2323 was one we have not used in 2 years. It was empty. That was not one of Core IP's collocation cage.

All of their information was dated. 2 years old. One disgruntled employee gave the a full BS report 2 years ago when he was fired, and they set on it until they got a call from AT&T.

Your a bit off. The affidavit is from the search of my house and data center weeks ago, not the Core IP and Matt's house Raid, which was last week. All of my personal bank account, my employee bank accounts, and Matt's business and personal have been seized. Regardless of the fact that we could and did easily prove all of our income was from legitimate sources. The point was to decapitate any chance we had of a legal defense. I have not seen the Affidavit for the search of Core IP yet.

And by the way, the affidavit is complete BS. It doesn't even make sense from one page to the next. They listed many of my companies client companies, partner companies, and even vendors as if it was all one big conspiracy to steal phone service...it's ludicrous. My full story is at u w w w b . c o m

Neither myself, or anyone else I know that is involved ever did anything illegal to my knowledge. But either way, even if we were selling mad digital crack, the FBI did no investigation...they just destroyed hundreds of business without cause.

They said their informant said we had no customers, which is amazing, considering they seized our bank accounts...which is where they could have seen payments from hundreds of legitimate clients going back for over 5 years.

Once again, no investigation, and no effort whatsoever. They just shut down the networks and loaded up the equipment. Customers that showed up at my data center were threatened with arrest.

They are going to great efforts to prove we had some additional relationship with the businesses of our clients that they say owed AT&T or Verizon, beyond the client vendor/relationship. They said that they tracked everything back to us by IP Addresses and Phone Numbers, which of course we assign to clients. They weren’t even remotely interested in who was assigned what IP Address and/or Phone Numbers. They are happy with their big conspiracy theory, which is ludicrous, insane, and total BS.
More to the point, they have easily done 10x the damage of even the most ridiculously inflated carrier bill. That, and they destroyed my business, took all my money, put my employees out on the street, and scared the hell out of my kids…apparently on behalf of AT&T and Verizon.

If you own a data center, be advised, the FBI doesn’t understand collocation. They are clueless when it comes to VoIP, and they are going to send a heavily armed SWAT team into your home at 5:00AM as soon as you have a client that screws with one of the big companies they apparently do collections for. Believe that.

Yes, my head is spinning trying to tie all this together. It's getting very hard to track who is linked to who and who owns what companies. You've gotten entangled in all sorts of VoIP companies, all of which appear to defraud (or attempt to defraud) major telcos. Either way, it appears from the search warrant that I read that Core IP was an accessory to your alleged operations and that the two raids are in fact essentially part of the same investigation.

The following are completely serious questions and I (and many others) would like an explanation.

1) How do you explain the submission of falsified documents to Verizon/AT&T?

2) Why did Core IP send the surety payment instead of the client?

3) Why do all of the VoIP companies accused of fraud either share office space, share phone numbers or share PO boxes with PremierVoice?

pin










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Correct, and what here lends you to believe that the warrant wasn't for all of the equipment in the data center?

Then you're also saying that if the FBI were to only take Core IP equipment they should trust Core IP themselves as to which systems were theirs and which weren't? If they did have servers of their own with proof of illegal activity, you don't think they'd do anything to hide it, like possibly simply labeling it as belonging to a different customer, or a customer who doesn't really exist, etc.?

The analogy I think that works for this is:

If you live in an apartment building, and there was rampant crime originating from that building, such that the local police were led to believe the building was simply an organized crime ring. Because of this, the police go through and thoroughly question all the residents and ask them to go "downtown" for a couple hours of questioning regarding all those events. They are taking that person's time, even though there is no proof they're directly connected, but they may have valuable information in the case. Similarly, these other systems are being held for questioning.

First, core-ip employees are not the same as core-ip owners. They have different interests in the matter. It is suggested that the majority of low level employees have no interest in getting caught up in the investigation than they already are. Being honest and frank would be a good start. The proposed course of action was to make initial identifications of non-core-ip servers, that the FBI could then followup by confirming directly with the identified owners. Some people call this investigation. Other people call it due diligence. Of course, in some parts of the world, causing maximum pain and incovenience is also labeled to be a legitimate investigative technique. Some countries are just more subtle about it.

Second, your analogy is flawed. The residents are, in theory at least, not shanghai'd downtown. No warrant, no probable cause, no arrest, no mandatory trip downtown. Anyone not under arrest who went downtown, went voluntarily. The affected server tenants (this is to avoid quibbling as to whether the servers were dedi's or colo's) would certainly tell you and the FBI that they did not in fact volunteer and are not of a mind to volunteer at this point in time. In fact, they are busily trying to wrest control of the disputed servers back. That being the case, any allusion to volunteering is plainly ludicrous.

Nice... they describe the location of the search the exact cabinet with lots of details, including the color, and then specify a long list (16 points) of stuff they can take...

From the search warrant annex B:


It looks like they really specified in fine detail exactly what they had to take from the datacenter.

What's a cabinet? Is it a 47 unit rack of servers or some kind of room where you have your racks? If it's the first, how can they specify the location that rack and then take out so many servers...

The wording you quoted looks more like it was copied and pasted from the customs code classification tables.

Then you're also saying that if the FBI were to only take Core IP equipment they should trust Core IP themselves as to which systems were theirs and which weren't? If they did have servers of their own with proof of illegal activity, you don't think they'd do anything to hide it, like possibly simply labeling it as belonging to a different customer, or a customer who doesn't really exist, etc.?


Exactly, it would be trivial to mark servers as belonging to a "customer" and there would be no way to prevent an outage for legitimate customers even if you could only take the offending party's property--you have to prevent the offending party from remotely destroying evidence which would mean also taking down their network.

Typically in a warrant you address where the evidence you presume is located at, the belief or probable cause that the evidence is to be located there. In the warrant provided to Mr. Falkner, it seems very apparent that the FBI was 'fishing'. If the complaint indicated toll fraud as both the Agent and AT&T/Verizon have indicated. Then presumably the evidence would be on the machines owned by the respective companies Core Ip, LLC and Falkner's companies. Since, the crux of the fraud resolves around toll fraud, the machines involved would have been used to provide VoIP services and would have been the property of Core IP,LLC, et al.
Some of the issues I find with the warrant are gleaming; such as txt files being hidden within .jpeg images. Come on has anyone heard of anyone convicted of toll fraud hiding accounting records within images?

If you examine another affidavit for probable cause drawn up by the same agent, you will see he clearly specifies which accounts #spoof card’s and evidence he's looking for. As it related to his department's investigation into the false 911 swatting incidents.

Full audio can be found at
http://blog.wired.com/27bstroke6/2009/01/guilty-plea-bli.html

I also found the original affidavit of probable cause in the above case, after searching through some files on my server. Its 30 pages and approximately 20 Mb.
http://libbs.net/CCF04152008_00000.pdf

Here is a link to the application for the search warrant:

crimeblog.dallasnews.com/2323%20Bryan.pdf

won't let me post the full link with under 5 posts..

From paragraph(1) of the affidavit in support of the warrant, page 7, he seems to have magically become much more qualified than being the guy who played the most video games in the office:

I, Allyn Lynd, having been duly sworn, depose and state as follows:

1. .... I have received specialized training in the field of computer intrusions and intellectual property crimes.


here's a goody:

There are so many types of computer hardware and software in use today that it is impossible to bring to the search site all of the technical manuals and specialized equipment necessary to conduct a through search.


Uh-huh, in the hosting world that would be linux, freebsd, solaris, windows, ide, sata, scsi and sas drives. There are vendors who sell portable certified forensic disk duplication kits for $xxxx.

Talk about stretching a point.

link to the warrant application and supporting affidavit:

http://crimeblog.dallasnews.com/2323%20Bryan.pdf

Typically in a warrant you address where the evidence you presume is located at, the belief or probable cause that the evidence is to be located there. In the warrant provided to Mr. Falkner, it seems very apparent that the FBI was 'fishing'. If the complaint indicated toll fraud as both the Agent and AT&T/Verizon have indicated. Then presumably the evidence would be on the machines owned by the respective companies Core Ip, LLC and Falkner's companies. Since, the crux of the fraud resolves around toll fraud, the machines involved would have been used to provide VoIP services and would have been the property of Core IP,LLC, et al.
Some of the issues I find with the warrant are gleaming; such as txt files being hidden within .jpeg images. Come on has anyone heard of anyone convicted of toll fraud hiding accounting records within images?

If you examine another affidavit for probable cause drawn up by the same agent, you will see he clearly specifies which accounts #spoof card’s and evidence he's looking for. As it related to his department's investigation into the false 911 swatting incidents.

Full audio can be found at
http://blog.wired.com/27bstroke6/2009/01/guilty-plea-bli.html

I also found the original affidavit of probable cause in the above case, after searching through some files on my server. Its 30 pages and approximately 20 Mb.
http://libbs.net/CCF04152008_00000.pdf

BTW, according to Lynd, carrying a usb harddrive containing all your emails and financial records is somehow suspicious (paragraph 41). As is having a router at home. As is having your business mail sent to a p.o. box because you want to separate business from personal. So, if you have a usb harddrive and a broadband router, get in line ...

I have become quite aware of Mr. Lynd and his department over the course of the past two years. And while I do not doubt that he is very well versed in the topic of criminal law.

This case and the implications the merits of this warrant, and searches raise to not only collocation providers, but also law firms, telco providers and businesses in general should NOT be taken lightly.

Already in the case of Liquid Motors Inc v. Lynd/ USA http://dockets.justia.com/docket/court-txndce/case_no-3:2009cv00611/case_id-185339/

The justice of the case, confirmed the plaintiff in the case was not believed to be involved in the fraud. However, the companies Temporary Restraining Order (TRO) against Mr. Lynd was denied. Furthermore,the FBI and government has asked the company (Liquid Motors) to provide hard-drives so that the bureau can copy all of the companies SAN data. And retain that data. Since "The United States confirmed that plaintiff is not a target of the criminal investigation, but that plaintiff’s equipment may have been used by members of the criminal conspiracy to conduct or facilitate the criminal enterprise. One of the members of the criminal conspiracy is the landlord for the building where plaintiff’s computer equipment is located and is very knowledgeable about computers"

"The United States advised the Court that additional FBI technical staff were available to assist with the copying of
the data from the servers and Dell AX100 SAN storage array. However the speed of this copying was subject to the availability of hard drives onto which the data can be copied.
The extent that plaintiff could provide blank hard drives onto which the copies could be made would facilitate the speed with which the data copies could be returned to plaintiff."

apologies for missing the edit time window, here is an expanded answer:

Typically in a warrant you address where the evidence you presume is located at, the belief or probable cause that the evidence is to be located there. In the warrant provided to Mr. Falkner, it seems very apparent that the FBI was 'fishing'. If the complaint indicated toll fraud as both the Agent and AT&T/Verizon have indicated. Then presumably the evidence would be on the machines owned by the respective companies Core Ip, LLC and Falkner's companies. Since, the crux of the fraud resolves around toll fraud, the machines involved would have been used to provide VoIP services and would have been the property of Core IP,LLC, et al.
Some of the issues I find with the warrant are gleaming; such as txt files being hidden within .jpeg images. Come on has anyone heard of anyone convicted of toll fraud hiding accounting records within images?

If you examine another affidavit for probable cause drawn up by the same agent, you will see he clearly specifies which accounts #spoof card’s and evidence he's looking for. As it related to his department's investigation into the false 911 swatting incidents.

Full audio can be found at
http://blog.wired.com/27bstroke6/2009/01/guilty-plea-bli.html

I also found the original affidavit of probable cause in the above case, after searching through some files on my server. Its 30 pages and approximately 20 Mb.
http://libbs.net/CCF04152008_00000.pdf

BTW, according to Lynd, carrying a usb harddrive containing all your emails and financial records is somehow suspicious (paragraph 41). As is having a router at home. As is having your business mail sent to a p.o. box because you want to separate business from personal. So, if you have a usb harddrive and a broadband router, get in line ...

Well, he worries about renamed files, but somehow PGP is not really a concern. Or even passworded zip files. Then again, you have to figure out ROT-13 before moving on to steganography. Baby steps.

Forget USB drives then.

Use terminal services over a VPN tunnel with PKI cert authentication required to a windows server running encrypted file systems mounting TRUECRYPT virtual drives. Then PGP the really important files.

In Russia.

After bouncing through VPN gateways in China, Japan, Switzerland, and France.

Optionally, put in a deadman's daemon that requires ok messages every 72 hours through a different passive channel.

Also, not to get off topic but, since the same agent is involved in the investigation into the swatting instances. A very large list of court documents and proceedings have been gathered in the 911 swatting cases Mr. Lynd has been involved in investigating.

A full discussion can be found at

http://www.binrev.com/forums/index.php?showtopic=40224

http://partyline.ning.com/group/legalteam

I have become quite aware of Mr. Lynd and his department over the course of the past two years. And while I do not doubt that he is very well versed in the topic of criminal law.

This case and the implications the merits of this warrant, and searches raise to not only collocation providers, but also law firms, telco providers and businesses in general should NOT be taken lightly.

Already in the case of Liquid Motors Inc v. Lynd/ USA http://dockets.justia.com/docket/court-txndce/case_no-3:2009cv00611/case_id-185339/

The justice of the case, confirmed the plaintiff in the case was not believed to be involved in the fraud. However, the companies Temporary Restraining Order (TRO) against Mr. Lynd was denied. Furthermore,the FBI and government has asked the company (Liquid Motors) to provide hard-drives so that the bureau can copy all of the companies SAN data. And retain that data. Since "The United States confirmed that plaintiff is not a target of the criminal investigation, but that plaintiff’s equipment may have been used by members of the criminal conspiracy to conduct or facilitate the criminal enterprise. One of the members of the criminal conspiracy is the landlord for the building where plaintiff’s computer equipment is located and is very knowledgeable about computers"

"The United States advised the Court that additional FBI technical staff were available to assist with the copying of
the data from the servers and Dell AX100 SAN storage array. However the speed of this copying was subject to the availability of hard drives onto which the data can be copied.
The extent that plaintiff could provide blank hard drives onto which the copies could be made would facilitate the speed with which the data copies could be returned to plaintiff."

Translation: you want the SAN back? pay for the drives to put the copy on, because we ain't in a hurry to buy any anytime soon.

Here is the main issue, even after you get past the warrant and the Judge that signed off on it. The FBI or DOJ should not be allowed to come in and raid three separate datacenter's; shutting down ISP's, entire companies, Telco companies which operate emergency 911 services for over 100,000 customers. And ironically as one reporter specified “even taking some AT&T servers down.” All because one or multiple owners companied may have been defrauding the AT&T/Verizon.

The proper evidence that needed to be obtained should have been listed, and if that was not feasible. Then the warrant should have only addressed the companies servers, and not that of every legitimate customers machines in the datacenter. If the lack of evidence precluded charges being filed, that unfortunatly AT&T/Verizon would need to write the fraud off on their respective balance sheet's.

I have worked for both companies in the past, and I can tell you from experience it's NOT uncommon for the RBOC's customers to get behind in payments.

Also the same bureau is also not alone in unpaid phone bills. Reuters Randall Mikkelsen reported on January 10,2008
Phone company cuts off FBI wiretap for unpaid bill
http://www.reuters.com/article/domesticNews/idUSN1021326220080110



What would have happened if they performed a similar raid on a large datacenter? What would have occurred if law firms; hospital HIPPA records, transcription providers that provided legal, government or other both time sensitive and confidential, CPA offices records all had their servers carted off. Because these companies or firms rented collocation space... And the owner or operator of that space (Collocation Provider), that was alleged (not proven or substantiated but alleged) to have committed a crime. Would you want your firm’s confidential information, or medical records being achieved by the FBI for later use, and based on the warrant provide the encryption keys?

Actually, it is more like you living in the home of a drug dealer. Even though you don't know it, you are going to lose your stuff if the house is raided. You might get it back if you really didn't know.

Notice that the FBI didn't shut down Telx, or even take equipment from them. No executives got their houses searched. I would imagine that Telx, or maybe the upstream data providers, had been asked for information which pointed to Core IP being involved. You know this is bad for Telx too. They now have at least one suit that will likely be defaulted on. Also, we don't really know how much equipment there was. I see mention of 50 customers which be could anything from a single web server to thousands of square feet.

We all agree this is tough for the people around, but I think we also need to agree that without all of the information we don't really know if it was heavy handed or not. If you lost your equipment it will definately seem so, but if your data was on Core IP equipment there is really no other way than the FBI seizing all assets.

Just as an aside, this space is right across from the space I had over there. It's not very big, maybe a couple hundred square feet of raised floor area for the cabinets, unless they renovated it of course.

Actually, it is more like you living in the home of a drug dealer. Even though you don't know it, you are going to lose your stuff if the house is raided. You might get it back if you really didn't know.

Notice that the FBI didn't shut down Telx, or even take equipment from them. No executives got their houses searched. I would imagine that Telx, or maybe the upstream data providers, had been asked for information which pointed to Core IP being involved. You know this is bad for Telx too. They now have at least one suit that will likely be defaulted on. Also, we don't really know how much equipment there was. I see mention of 50 customers which be could anything from a single web server to thousands of square feet.

We all agree this is tough for the people around, but I think we also need to agree that without all of the information we don't really know if it was heavy handed or not. If you lost your equipment it will definitely seem so, but if your data was on Core IP equipment there is really no other way than the FBI seizing all assets.

Actually based on evidence in the Liquid Motions v Lynd lawsuit filed, and reports of the business owners that were affected by this raid. We now DO now know definitively that many of the assets that were seized did not belong to Core IP, and I am sure there were ample records to prove so. Additionally, those business owners armed with receipts and evidence to retrieve their own property were being turned away and in some cases threatened to be arrested.

Maybe we should start a consortium of lawyers, and similar government lobbyist groups to insure that something like this does not occur again in the future? Any opinions... I know that I have spoken to one of my datacenter's, and told them jokingly to have plenty of hard-drives on hand to back up their three 40,000+ sq feet server farms. Should the Dallas FBI not like me linking to the 911 swatting report, even though Mr. Lynd has told me verbally that I may disclose publically available information in that case, as it would not hinder their prosecution.

Since we are all questioning how the FBI conducts its own investigations. In this 2007 Podcast with Allyn Lynd, and Kai Oxford of Microsoft, they both talk about Digital Forensic Investigations. A link to the podcast can be found at
http://www.microsoft.com/seminar/en/BMO-PODCAST/TechNet_Windows_Mobile_MP3.xml

Kevin Remde asked the question: "But sometime's your business may be shutdown"
Mr. Lynd States "We try to avoid it, but if there is contraband... but usually what we try to do is come on-site and image at night."

Wired.com staff reporter Kim Zetter ran a story, which hopefully should shed some light on this story, and those affected by this raid, the story can be found at
http://blog.wired.com/27bstroke6/2009/04/data-centers-ra.html.

I also spoke to one of the individuals (Jason) of Zattco communications http://www.zattco.com that was affected by this raid. He confirmed that "he too had to drop off a hard-drive to the FBI" in an attempt to have his data returned to him. And Zattco is in the process of temporarily getting his business back online, yet as a result of the raids "he has lost customers."

Additionally, on an unrelated issue I received a call from the FCC. And asked Kelly, to see if the FCC would review the legal merits of this case, and possibly step in or at the very least get back to me on how legitimate businesses can have their operations affected. As I along with many of the ISP's/Colocation/CLEC providers on this forum, want to know how the 100,000 VoIP 911 (residential and business customers) can be left without emergency services, prisoners in three states without access to phone lines. Not to mention all of the legitimate businesses that have to hang on and wait patiently wait while their businesses are destroyed!

I will pose the same question again:
What would have happened if they performed a similar raid on a large datacenter? What would have occurred if law firms; hospital HIPPA records, transcription providers that provided legal, government or other both time sensitive and confidential, CPA offices records all had their servers carted off. Because these companies or firms rented collocation space?.. And the owner or operator of that space (Collocation Provider), that was alleged (not proven or substantiated but alleged) to have committed a crime. Would you want your firm’s confidential information, or medical records being achieved by the FBI for later use, and based on the warrant provide the encryption keys to that data?

From that article:

An agent told the customer that no equipment would be released until agents could determine if it was used in criminal activity. And if it was used for criminal activity, it wouldn't be released until after a trial.

--

We got basically the same response from them. After reading that article and the amount of money seized, my perception has changed. But I feel the FBI should have planned better to be faster in doing the "forensics" on the amount of servers they confiscated to reduce any impact on any innocent businesses. Luckily we don't need any data off of our servers, but I can't say the same for other people affected.

From that article:

my perception has changed.

Good to see common sense came out victorious ;)

I am so glad we don't have servers in the US any more. I don't think we could take being down for weeks without access to our servers just because we were in the same data centre as someone who was alleged to be involved with an alleged drugs farmer.

To AT&T or Verizon, that is a drop in the bucket. Preventing small businesses from accessing their data for days at a time has potentially more severe consequences. (comparatively speaking)

I believe in punishing criminals, but armchair quarterbacking this, it seems the FBI should have done more due dilligence so as to minimize disruption of innocent businesses. Clearing out an entire colo-- customer equipment, along with the host's equipment-- seems pretty hard to justify, if this is just over some money owed to a telecom.

So just keep any documentation of illegal activities on your shared web hosting servers, since the FBI can't take them down because it would affect so many innocent customers?

No, Karl as the warrant and situation that has unfolded so far. If anyone in your Data Center had questionable material on their server. They COULD seize your entire datacenter, all of your client’s servers and their confidential data! Even in the Liquid Motors case, the FBI stated they were not the focus of the raid, nor as I have interpreted the case there was NO reason to believe that they had committed fraud. Yet, there may be data hide on the companies servers (because Core IP, LLC) and some of their partners, are "very skilled" and they may hide txt files within .jpeg files and carry around removable hard drives.

First, core-ip employees are not the same as core-ip owners. They have different interests in the matter. It is suggested that the majority of low level employees have no interest in getting caught up in the investigation than they already are. Being honest and frank would be a good start. The proposed course of action was to make initial identifications of non-core-ip servers, that the FBI could then followup by confirming directly with the identified owners. Some people call this investigation. Other people call it due diligence. Of course, in some parts of the world, causing maximum pain and incovenience is also labeled to be a legitimate investigative technique. Some countries are just more subtle about it.

Second, your analogy is flawed. The residents are, in theory at least, not shanghai'd downtown. No warrant, no probable cause, no arrest, no mandatory trip downtown. Anyone not under arrest who went downtown, went voluntarily. The affected server tenants (this is to avoid quibbling as to whether the servers were dedi's or colo's) would certainly tell you and the FBI that they did not in fact volunteer and are not of a mind to volunteer at this point in time. In fact, they are busily trying to wrest control of the disputed servers back. That being the case, any allusion to volunteering is plainly ludicrous.

1) And the police are to know how all of the employees may or may not be involved in this how?? You don't think the FBI telling them to label servers for customers, etc. would tip them off a little bit, thus they'd then attempt to remove or erase any incriminating data from that point on?

2) I do not see how my example is flawed. If it is a large criminal operation and you refuse to cooperate with the investigation they WILL find a way to force you "downtown."

No, Karl as the warrant and situation that has unfolded so far. If anyone in your Data Center had questionable material on their server. They COULD seize your entire datacenter, all of your client’s servers and their confidential data! Even in the Liquid Motors case, the FBI stated they were not the focus of the raid, nor as I have interpreted the case there was NO reason to believe that they had committed fraud. Yet, there may be data hide on the companies servers (because Core IP, LLC) and some of their partners, are "very skilled" and they may hide txt files within .jpeg files and carry around removable hard drives.

OK, now where did you get the "If anyone in your Data Center had questionable material on their server. They COULD seize your entire datacenter," from?? This case proves that if your colocation provider is directly involved in a multi-million dollar wire fraud case you may have your equipment taken up in the whole thing as well. This is not about illegal actions taken by someone in the data center, but by the company running the data center, a major difference.

I am so glad we don't have servers in the US any more. I don't think we could take being down for weeks without access to our servers just because we were in the same data centre as someone who was alleged to be involved with an alleged drugs farmer.

Not alleged drugs farmer. Alleged Playstation user running pirated games -- a very dangerous person requiring 15 police cars and SWAT team. :D

I would like to have the answers that were posted about why Faulkner used phony or fraudulent papers to set up his Ds3's, and why he used them or decided to. I also read his blog at uwwwb and found some interesting things that I thought to post here, especially since Faulkner is posting here. Maybe he will respond or maybe not.

I would also like to say that it appears that Faulkner is about as stupid as a person I have ever seen, and I will also detail that here. He rants on various blogs, wired, his own, here, and probably many other sites. And his rants equal to a confession in each one, which by the way seems different on each blog or area he posts on. I would say that Faulkner is probably sealing his own fate and the fate of everyone involved with him by doing so. I am not an attorney, but I would think it best that he shut the hell up, instead of just giving the FBI and the prosecutors more and more evidence against him. But such is the way he is choosing to go about his life post raid, and I find his rants quite stupid at the least.

Here are some things I read from his blog that I think shine a light on what his activities were or are today.

You would expect this kind of totalitarian storm-trooper activity

I have read with interest on various blogs, including the wired blog, many anti government types commenting on it. And you can easily tell who they are with the words they always use, and this is one of the phrases commonly used above. Most of the blogs about this story are filled with these types of people commenting on them, as if he had many friends in that community. I started wondering why so many of these comments on other blogs were filled all of a sudden with these type of people on them. And then read Faulkner's post about the raid on his blog and started noticing his speech and mannerisms were much the same as these anti government types who have been commenting on the raid. So I post that above and wonder just how many of these guys he is involved with. Or how he maybe went out and asked them to troll various sites trying to paint a picture of the FBI and the case against him as some sort of government plot - and some sort of freedom or liberty type of movement is now needed to defend him.


But the United States Federal Bureau of Investigation actually did NO investigation.

Again the post looks like he is some sort of anti government type. Why not just say the FBI didn't do an investigation. I notice that he has many posters from the EU and UK and various other places commenting on each blog, maybe a connection? Either way, the pdf affidavit that has been posted spells out a very complex and complete investigation prior to the raid happening. Why he claims there was no investigation despite this search warrant is beyond me.


They took the statements of at least one disgruntled ex-employees of the company (Marcus Wentrcek), which was fired for drug use 2 years ago.

Then there was drug abuse in the company, assuming that Faulkner fired this guy for drug use. However on Wired he claims the employee/informant was fired for not showing up to work. On his blog he claims the guy was an investor in one of the companies, and he also claims on a blog that he paid the guy 70k for establishing a VOIP company, but fired him for not following through. Then later in this same post on his blog he points out this


The FBI’s informant, Marcus Wentrcek, was a partner and investor in one of my business ventures called Premier Voice, a Hosted VoIP Service for Small Businesses. This company was an epic failure. Marcus put $70,000 in, I put in close to $600,000, and then the venture failed largely due to the fact that Marcus likes to drink on top of handfuls of prescription pain killers, leaving him not a very effective network engineer or Chief Technology Officer. After this guy destroyed my company, and lost my money, he had the nerve to ask for his $70K back. Meanwhile, I had lost so much personal money in the project I was trying to figure out a way to pay my own mortgage at the time. Needless to say, I told him feel free to sue, but I wasn’t paying him a dime for destroying my company.

The operative word here is that Faulkner has many issues with subterfuge. Which story to believe about the informant? Did the informant invest 70k and ask for it back and not get it? Did Faulkner fire him? How can you fire an investor? Why did Faulkner claim on Wired that the informant was paid 70k when it clearly shows in Faulkner's own rant that he never paid the guy anything and let the informant lose his 70k? I would say just based on that Faulkner covering up, lying or ??


As many of you may know I have played the role of Network Security guy Sean Dillion, AKA CygonX for many years. Truthfully, that wasn’t even my real name.

OK. So you make up names to suit you or suit the purposes of what you are doing? So no one knew you were Faulkner when you were this other guy. OK, on the net you got to have some privacy, I'm cool with that.


Over the years, I have bought, sold, and built a large number of small tech companies.

Apparently over the years every company you started, bought or sold was broke, busted, out of money or plain fraudulent when your hands touched it or left it. I read that from the affidavit. Maybe you have a different story, but...


but I live in a $700,000 home in Southlake Texas, the United States highest per-capita income city for 2008. A very nice community, virtually no crime, and excellent schools.

That is very nice to hear. Good for you.


I do not live in a shack in the hood, this is the high-income suburbs.

OK.


The Gestapo raids my home

Ahhh, here is where the fun begins. Who calls them Gestapo? Let's see, totalitarian, gestapo..Hrmm.. Ok.


The Gestapo raids my home at 5:AM for what appeared to be some white-collar misdemeanor offenses, of which they had no real evidence of me even being involved with.

How did you know at 5 am that they had NO EVIDENCE against you? Maybe you were "EXPECTING IT?"


They continued to ask me questions for 4 to 5 hours, and although I swear on my skin

Busted. Only white power freaks use the term "swear on my skin" lol.

Normal people say I swear on the souls of my XXX, I swear to God, I swear to to you, I swear on my life. But I swear on my skin is a term used with white power skinheads, gang members, etc. The skin is the most sacred thing to swear on, because swearing to god, the bible yada yada is not considered to be a good thing. But swearing on your skin is meant to say to them yes, if he is lying his skin isn't white..Of course I could be wrong, but so far we have "totalitarian" "gestapo" and "swearing on your skin".


The amazing thing is that this guy was fired almost 2 years ago. So NONE of the information the FBI had was even current.

Uhh, well, the affidavit shows that they had allot of current information. Read it. You will see its very current.


Since then, he has threatened to contact the FBI and tell them that I intentionally ran up a bunch of dept without paying,

You did. According to the affidavit you never paid one frigging dime to them for services rendered to you, your myriad of companies, or anything or anyone that gave you services.


Long after I fired him, I discovered Marcus Wentrcek was a notorious drug dealer at SMU in Dallas for the 4 years he spent there.

For a tech savvy guy like yourself, maybe you would have easily known how to find out this about the star informant prior to hiring him. But you only found out later. Hrmm..

Your company already sounds shady.

So the feds seize the data center based on that 2-year old statement from a very unreliable source.

No, they investigated you using deep FBI packets and found that you were a fraud. That you never paid your bills, used false credit apps made to look like they came from your companies, and or used fake documents to obtain services which you never paid for. And I note in every blog that you have been asked this question about the fake docs and you never answer it. So in a way you show your stripes right there.

You had no credit to get services. So you used fake documents that were photo shopped to get DS3's. Without which you would have had to pay large sums of up front money to obtain.


This is a government contractor; they provide all the phone service for prisons in 3 states. All of which lost their phone services when the FBI raided the data center. We also had a Credit Card Processor, Mortgage companies, and dozens of VoIP companies as well.

Your few companies were legit, but you don't list many of them other than your one source of legit money, Intelimate. The rest, mortgage brokers lol, {well I think those guys are mostly scammers right?) Credit card processors? OMG, OK. Dozens of VOIP providers, (mainly all of your shell and sub companies right?)

Not many legit people with you it seems.


The FBI effectively did tens of millions of dollars in damages to dozens of businesses within a few minutes based on bad intel, and no investigation whatsoever.

The affidavit spells out a very thorough investigation. Those with real intelligence can read it and see right through your lies and pandering to people who have limited intelligence trying to sway them to your cause. NO INVESTIGATION WHATSOEVER? I hardly think that is true at all. I think it was a very well done investigation.


I actually got a copy of the 40 page affidavit they submitted to a federal magistrate to get the search warrants…it’s 90% outright lies, and 10% misrepresented truth.

Can you elaborate? One question. WHY did you use fake docs, manufactured docs, pshopped docs, whatever. Why did you use phony docs to obtain credit with these companies to get your DS3's?


Seriously, is each “cybercrime” is so identical that you can actually “profile”

Pretty much. Let's see. You used a bunch of different names for different companies with mail box drops, different names of owners who were personally involved with you or your friends, and or people you have known a long time, phony fax numbers, disconnected numbers, cell phone numbers, numbers with left off digits, various addresses for companies that had no real business, various managers not getting paid, various bounced checks for services never paid for. No wonder you live in a 700k home. You never pay anyone but yourself or those involved in your scams.

Yes, your profile is that of a criminal. As all criminals use the same ways to manage their crimes. Avoid (paying bills) avoid (people able to locate you) avoid (everything that could connect you to a previous scam.)


These bumbling fools accused me of using illegal drugs, when in fact I have never even seen these drugs anywhere but on TV.

But wait, you just said your investor/employee, you know, the informant was a notorious drug dealer. And when you knew him, he was always popping pills and yada yada yada...But now you are an all homegrown weightlifter and exercise guru who never has seen "DRUGS"

OMG..What a rube you are.


Okay, so let’s just say they are doing their job, and they are not turning the country we love into the new Nazi Germany.

Nazi Germany? What's next in your vocabulary, Black Helicopters? Storm Troopers?


To be honest, I am not a tin-foil-hat guy, I don’t believe in 9-11 conspiracies, and I just don’t buy into any of the government conspiracies.

But you sure use the words they use when it makes your argument more effective.


So the FBI is under-funded, under-educated, under-staffed, and they don’t have the budget or the man hours to truly investigate anything.

Buddy. You don't know the half of it. They know allot more than you give them credit for. And their budgets beat your house payments by a million billion miles.


They found no drugs, no guns, and no evidence of any criminal activity.

Ok, riddle me this. Have you been involved in criminal activity in the past? Been busted before? Done time? Been in jail? Been accused? Ever been in the justice system?

Please answer that. How about all of your employees that were also named and raided? They ever been inside? Been in the justice system? Been busted? Been in jail? Been locked up? Accused of criminal activity? If so, what was it? Please elaborate so we can know you better.


Fact: Allyn Lynd went to Westpoint

That explains it. I believe their motto is this:

I will never lie cheat or steal, nor tolerate those that do.


And to add fuel to the fire, the FBI took every dime I had leaving me to struggle to find a way to pay my 3 mortgages and feed my kids.

Yes, that is what they do when dealing with scammers aka Madoff, Stanford, etc. They take the money you made and you can't use ill-gotten gains or fruits of the crime to defend yourself with. Tough world right?


And about that lawyer, the quotes I have received have been non-refundable fees of $100,000 and up to defend a case this complicated. Not a retainer, these guys want a non-refundable $100K with no guarantee of any kind.

In the justice system there is no guarantee of any outcome, more so for complex scams like yours. You sort of buried yourself with complexity to hide the scam, now the attorneys need allot more money to defend you because of it lol...


Will I go to jail in the next 6 to 12 months, and will my family be left out in the cold? All indications point to yes. There is not a whole lot I can do about that, I am working against a very big government that isn’t running on logical thinking.

Not logical thinking?

You failed to pay your bills, failed to use proper credit statements, you used phony docs, multiple companies to hide your scams, the list of logical thinking goes on and on. I think it's you who are not thinking logically.


I can’t begin to explain to you how it made me feel when the FBI’s top Cyber Crime guy talked down to me for running a “piracy” forum.

You admitted in various forums over the years that you were a PIRATE!!! Now, well, the story is different.


Obviously, I have a lot of problems, and I am probably going to prison for something I didn’t do. I only stand a small chance of being able to get a sizable loan in the next few months,

Here it comes. The FRAUD continues...


The unfortunate part is, with no income I am going to ding my perfect credit before I can get the house sold and get a loan to pay attorneys with. I am most likely not going to make it.

But your going to ask for money right?


Also, as much as I absolutely hate to do it, if any of you can spare a single dime in this economy to help me cover my damn bills long enough to get my credit straight so I can get a loan, it will not only be eternally appreciated, but refunded with interest should I get out of this with my shirt.

Anyone who fronts you money will lose it. But good luck bro, I know you need it.


I am going to spend every dime I have, and I am going to cost this damn government as much time and money as I possibly can while fighting every single charge against me. If i lose any of them, I will appeal them from prison, and I will continue to bleed every dime I possibly can out of this system in hopes that next time they make a mistake, that they can make it a policy to write off their loses and call it a day.

Good luck. Stand in line with the 3 million other innocent criminals behind bars who claim, act, do the same exact thing. Your all innocent inside.. lol...


Also, depending on how evil the government wants to be, I am going to continuously post the data associated with this “case”. Including if necessary the personal details of the witnesses, and the agents, involved with this injustice.

That is a threat to harm a witness Faulkner. You are an idiot. By claiming such lunacy they could get a warrant right now and lock your ass up for just saying that you are going to detail personal details against witnesses. I would imagine based on that one post that you are going to jail very soon, and we wont be reading about how innocent you are then, rather we will be seeing your pleading guilty to every count after they drop a few to get you to be over with. Your an idiot. Anyone that associates with you is probably going to get hurt based upon your insanity at this point in making such public statements, confessions, everything you have posted so far is going to be used in court against you. If you had an attorney he would advise you to shut the fck up. God your an idiot.


These people have gone to great lengths to destroy my life, and the lives of my employees, partners, clients, and their families. The least I can do is make life a little inconvenient for the opposition. It’s a big planet, lots of web hosts, in lots of countries, and UWWWB has an International member base.

More threats. You know, no wonder you failed.

If you know anything about credit, your credit takes a hit when you get a new account. After the FBI took all my gear, I had to go get a BestBuy card and replace a few critical items for my family. Obviously with no PC my hands would be tied, but with even a cheap laptop from BestBuy, I can at least get some work done to support my family.

So you go out and defraud Best Buy out of credit knowing you will never pay them because you are going to jail. So they wont get paid either. And, because you have such a hardship, instead of going to a library or a Kinko's or other place to post from, you buy or spend money on more computer equipment instead of buying food for your family. Then you have the AUDACITY to ask people to send you donations. You truly are a fraudster.


I just need a month or so for my credit to jump back up, so I can get a loan.

Credit doesn't jump back that quick. Matter of fact, this is just another con you are doing. Telling people that your credit will swing back real quick but just loan me a dime first..Great con.


Since Mitnick got popped

Arrested tried and convicted you mean. Popped is a slang term used by other cons.

But you have been clean all your life right?


I’m awake. They have my attention. But now I am now under the gun,

Under the gun? That is a term used by people who are going to rat out others to save themselves....

Watch out friends and neighbors...Faulkner is under the gun...


and if I don’t move fast I’ll be out of the game altogether.

Out of the game? What game? The game you have been playing with Verizon, AT&T and your customers? You mean the con game is soon to be over? I pity the fool......lol....


Update: 4/6/2009
We got hit with a DDoS Attack on the offshore server.

Man, you are out of the game. Out of the game of taking other people's money and pretending it's your own. I recommend you get an attorney with that Best Buy card and just shut the fck up and go away quietly before you get yourself into more trouble. Threatening witnesses in a federal investigation is a federal offense. Threatening to expose the governments case in public is also another federal offense. Telling your story is one thing, going public with witnesses private details being exposed, agents personal details exposed, etc. etc. etc. is just digging your own grave. Shut up and just take it up the a$$ like you have been doing to so many others for so long they need Vaseline to make it feel better and just deal with it privately.


Good luck Faulkner, you will need it.

OK, now where did you get the "If anyone in your Data Center had questionable material on their server. They COULD seize your entire datacenter," from?? This case proves that if your colocation provider is directly involved in a multi-million dollar wire fraud case you may have your equipment taken up in the whole thing as well. This is not about illegal actions taken by someone in the data center, but by the company running the data center, a major difference.

Karl that causal observation was drawn from the rule of law, first warrant & seizure on Crydon Technology, and court case in which the government is a named defendant (Liquid Motors,LLC v Lynd/USA). Since we are dealing with two facets of the law, let’s start with the warrant, among items its alleging that both Michael Faulkner & Matthew Simpson were involved in a scheme to defraud the Telco’s out of bandwidth/ interconnection minutes. The Agent goes onto explain, factually the basis of this belief, stating that the companies setup ‘shell corporations’ and used mail forwarding services. Along with reports from Verizon and AT&T employees stating that one agent acting on behalf of the companies (Ronald Northern) sent a forged bill to AT&T to pass credit. He also stated that a CI (confidential informant) had believed that one defendant Mr. Faulkner was believed to have used crack cocaine and other illegal drugs, and carried a “personal sidearm without being licensed for it”.

The same agent also provides rational behind the needing to remove hundreds of customer’s machines (which do not belong to either Cydron or Core IP Networks), stating among other reasons “Pg. 35 Faulkner warrant: Searching computer systems is a highly technical process which requires specific expertise and specialized equipment. There are so many types of computers hardware and software in use today that it is impossible to bring to the search site all of the necessary technical manuals and specialized equipment necessary to conduct a thorough search.” D. “computer users can attempt to conceal data within computer systems.. Though use of ‘encryption’ ‘dongle’ or ‘keycard’ and within image files a process called ‘steganography’”.

So based the legal basis of this warrant and related seizure that was signed off by a Judge, the agents had the authority to remove not ONLY Cydron equipment, but also those servers/equipment (that are property of their customers).

Additionally, as evidenced by the reports from the companies that were not parties to the fraud and as demonstrated in court documents, have had their data mirrored by the FBI for later analysis and use. This is one of the main issues that lawyers are going to have a issue with, since now companies not involved in the alleged crime are being forced to provide confidential and legally protected information to the government.

I have worked for several Telecommunications’ companies in both an Account Management and Sales & Technical support roles. And I can tell you first hand, that it is not uncommon for CLEC or VoIP companies to fall behind on their wholesale accounts, In fact it occurs more often that you may think. I know of several prominent companies that resell Data T1’s/VoIP/ Ethernet types of services, and some of delay payment for 60-90 days or until the Telco’s shut them off for non-payment. I have also witnessed on several occasions in which companies over report capital or earnings in order to pass credit. In this case, it sounds as if both companies had difficulties passing credit, so one of their agents falsified Telco bills in order to pass credit.

**Note: I am not saying that these companies should NOT be investigated. I will say again, that there defiantly needs to be an investigation here, and if fraud is involved the respective parties should be prosecuted. However, companies not involved in the facilitation of the crime that were renting space, should not be affectively put out of business, merely because their upstream provider has been alleged to have committed a crime**

I don’t see a single business owner on this forum, including Mr. Faulkner who has had his home and company ripped apart, and assets seized saying that the FBI did not have a right to investigate the fraud on his company’s servers. Yet many of his customers, business owners and operators of Data Centers are saying “wait just a minute here”? Does the alleged criminal actions of a party you are renting space from, allow the government to seize my equipment and put me out of business , when I am operating and running a legitimate business such as Liquid Motors, Intelmate, and Primary Target. And in that sense, many of these legitimate business owners feel that the warrant was too broad and not enough evidence to allow their equipment to be seized.

My company was in the affected colocation facilities of CoreIP and I wanted to share facts with the community to help you so what happened to our company doesn't happen to yours.

1. Your equipment can be seized if your colo provider or network provider is alledged to have committed criminal activities. We owned all our own equipment and the colo company did not have login access to any of our equipment. But since they provided the network connection to our firewall and had phycical access to our equipment (could touch the equipment), the FBI seized the equipment. A judge in federal court upheld the FBI could do this when one of the affected companies sued the government and FBI for a temporary restraining order. This is very scary for all of our civil liberties! You should probably do background checks on anyone you rent space from. This includes your office space, your apartment, your public storage and your data center. If the owner is alledged to commit a crime, you property in facilities they own can be seized for analysis.

2. Your offsite DR should be with a different colo company and with a different network provider (ours wasn't - shame on us, just never thought of this scenario). The DR companies should have no relation to your production colo company and network provider. We planned for power, network, fire, terrorists, etc., just not multi-site FBI seizures. We probably need a criminal mind to consider this as a scenario. Now you don't.

3. You should have enough reserves in the bank to be able to buy all new equipment because if the FBI seizes your equipment, they will keep it until they have analyzed all of it. That takes many months. You need the reserves because even if your DR plans work, you now need another site for DR the minute your main site is seized. We had buy all new equipment over the last 5 days even though we will get our seized equipment back some time in the future.

4. I would recommend using virualized servers and keep images of the servers off-site so once you buy new servers, you can quickly get them up and running. The backups they provide you will not run on other equiment. (i.e. it is not dd images). Our off-site images would not run on the new equipment either as servers have changed so much in the last 3 years. We had to build servers from the ground up and restore just ocnfiguration.

5. Have great vendors. You will need them to help so you can get back up and running fast. Many components we had take weeks to order and some of our vendor expedited delivery to help us out. They also provided on site engineers to help reconfigure the new environment. We now know who to do business with in the future.

The unfortunate situation is the FBI is trying to catch bad guys and I support their intent. I just don't support their execution. The collateral damage they inflicted has caused more in losses for the innocent businesses affected than the alledged crimes of the people they are after. They do not understand colocation or data centers, nor do the judges. That is clear from their actions and the discussions we have had with them.

The situation sucks but is absolutely possible in any facility regardless of location.

Please let me correct you. In Russia, if you are licensed ISP such situation is impossible due to law. What you need to be licensed ISP in Russia? You should do following:

1) Buy license (issued for 5 years)
2) Register your communication center ( it might be data center, collocation or even one or few servers. In other words - network equipment)
3) Touch to representative of FSB in your region and get confirmation from him.

I more than sure that if ISP business in USA covered by licensing such situation will be impossible. Raiding DC is very serious issue and it is not only local US citizen and firms problem but also problem for foreigner. Especially when we talk about equipment owned by foreign firms and person.

No, Karl as the warrant and situation that has unfolded so far. If anyone in your Data Center had questionable material on their server. They COULD seize your entire datacenter, all of your client’s servers and their confidential data! Even in the Liquid Motors case, the FBI stated they were not the focus of the raid, nor as I have interpreted the case there was NO reason to believe that they had committed fraud. Yet, there may be data hide on the companies servers (because Core IP, LLC) and some of their partners, are "very skilled" and they may hide txt files within .jpeg files and carry around removable hard drives.
I still believe that FBI did what is necessary and proportional due to the owner's involvement and the scale of this case. At least for us, the FBI and the Feds were very courteous and professional. Once, we received a subpoena for one of our customer's server in our datacenter that was compromised for credit card fraud. It is apparent that our customer did not even know that his server got compromised because he is not very tech savvy. But the FBI did not RAID our data center and took all of the equipments. At another case, the FBI called and notified us about a customer named 'Jason Macer' (you can google this name) that did many fraudulent things in the past which allow us to terminate him and save us from loosing thousands of dollars (which we really appreciate).

So, I don't have any bad comments, instead I have a praise for the FBI for doing such wonderful job. I would caution people not to get carried over, because those who disobey the law or have negative experience with the FBI (such as UWWWB) will try to sway us from the truth with such compelling story that they were right, which is natural.

The unfortunate situation is the FBI is trying to catch bad guys and I support their intent. I just don't support their execution. The collateral damage they inflicted has caused more in losses for the innocent businesses affected than the alledged crimes of the people they are after. They do not understand colocation or data centers, nor do the judges. That is clear from their actions and the discussions we have had with them.I hope they release your equipments very soon as you don't deserve to go through this. Have you contacted the FBI? From the news, it seems that they are willing to work with business owner who's never involved in this.

I wish you all the best.

in turkey, there is a law. you cant confiscate computers. you have to make two backups of hd contents, both sealed. you have to give one to the 'suspect' and the other you are going to take and use in your investigation. that's the way its written.

of course, police under the control of islamist akp doesnt stick by any tiny bit of this law. they directly come and grab your computer and go away, even if it is a server that serves thousands or a computer that has professional data on it.

conservatives. you cant love them enough.

I will pose the same question again:
What would have happened if they performed a similar raid on a large datacenter? What would have occurred if law firms; hospital HIPPA records, transcription providers that provided legal, government or other both time sensitive and confidential, CPA offices records all had their servers carted off. Because these companies or firms rented collocation space?.. And the owner or operator of that space (Collocation Provider), that was alleged (not proven or substantiated but alleged) to have committed a crime. Would you want your firm’s confidential information, or medical records being achieved by the FBI for later use, and based on the warrant provide the encryption keys to that data?
Very good question. I do believe that the FBI has a way to track these critical institutions first. I don't know if they have a certain standard protocol about raiding a datacenter with hospital, law firms, and other sensitive information. But, if some of us can think about it, they usually way ahead and already thought it through before making a move since this is their field.

I am sure that the FBI has a reason why they did what they did, but I am sure they have a reason why. I hope that they will provide us with some kind of statements to satisfy the innocent bystander that are affected.

I am sure that the FBI has a reason why they did what they did, but I am sure they have a reason why. I hope that they will provide us with some kind of statements to satisfy the innocent bystander that are affected.[/QUOTE]

Well it would certainly seem that 911 service, and prision communication systems are two critical systems that SHOULD not be taken down. I know when I spoke with the FCC, while they do not typically get involved in non-regulated VoIP carriers. The FCC was at least looking into this matter, to see what prompted these emergency services to be taken offline.

As for the reasoning behind the raid, I would certainly hope they have strong reasoning. Since many Colo operators, lawyers, marketing professionals do not feel especially warm-hearted about potentially having to provide the FBI with client confidential files and encryption keys, when they themselves are not targets of the investigation. Especially when the Data Center only provided terminating services, like many of their clients had mentioned. It would be slightly different had the two respected companies provided managed server offerings and had login information to Liquid Motors, Zattco's and other companies machines.

As I mentioned previously, I first heard about this case after google’ing Mr. Lynd’s name for his presentation on digital forensics late last week. I just so happened, upon these raids, and articles being reported on by cbs out of Dallas. Interestingly enough, his forensics presentation was not unlike many of the ones conducted by the FBI, and also general protocol that they try to follow.

In this 2007 Podcast with Allyn Lynd, and Kai Oxford of Microsoft, they both talk about Digital Forensic Investigations. A link to the podcast can be found at
http://www.microsoft.com/seminar/en/BMO-PODCAST/TechNet_Windows_Mobile_MP3.xml

Kevin Remde asked the question: "But sometime's your business may be shutdown"
Mr. Lynd States "We try to avoid it, but if there is contraband... but usually what we try to do is come on-site and image at night."

I would like to have the answers that were posted about why Faulkner used phony or fraudulent papers to set up his Ds3's

-snip-

Good luck Faulkner, you will need it.

Thank you for posting this. I noticed a lot of these and other discrepancies/red flags in everything this guy and the Core IP guy have said since this all went down but I was too lazy to run them down.

I'm all about some innocent until proven guilty but there are times when things are just so painfully obvious that it's hard to take the accused seriously. Innocent people don't threaten the FBI and witnesses.

From their coordinated and instant blaming of the FBI, code words, ever-changing story, warez forums and just plain stupidity it's obvious that these cats are up to no good and they're just shocked that anyone was able to figure it out. They are, after all, the smartest guys in the room.

Enjoy the pen, ladies.

Thank you for posting this. I noticed a lot of these and other discrepancies/red flags in everything this guy and the Core IP guy have said since this all went down but I was too lazy to run them down.

I'm all about some innocent until proven guilty but there are times when things are just so painfully obvious that it's hard to take the accused seriously. Innocent people don't threaten the FBI and witnesses.

From their coordinated and instant blaming of the FBI, code words, ever-changing story, warez forums and just plain stupidity it's obvious that these cats are up to no good and they're just shocked that anyone was able to figure it out. They are, after all, the smartest guys in the room.

Enjoy the pen, ladies.

My father passed on some wise words to me once...

"You are rarely going to be the smartest person in the room... if you are, you're in one damn small room."

Would small include, say, an 8x8 cell?

My company was in the affected colocation facilities of CoreIP and I wanted to share facts with the community to help you so what happened to our company doesn't happen to yours.

1. Your equipment can be seized if your colo provider or network provider is alleged to have committed criminal activities. We owned all our own equipment and the colo company did not have login access to any of our equipment. But since they provided the network connection to our firewall and had physical access to our equipment (could touch the equipment), the FBI seized the equipment. A judge in federal court upheld the FBI could do this when one of the affected companies sued the government and FBI for a temporary restraining order. This is very scary for all of our civil liberties! You should probably do background checks on anyone you rent space from. This includes your office space, your apartment, your public storage and your data center. If the owner is alleged to commit a crime, you property in facilities they own can be seized for analysis.

The Judge had denied the Temporary restraining order, not the entire case. If there is grounds to file motions and lawsuits as the Electronic Frontier Foundation (www.eff.org) and other groups are looking into, including Liquid Motors own lawyers, and hopefully your own. I would expect that an amended lawsuit will be filed in court, and depending on the outcome of the ruling the case may be referred to a higher court for clarification or perhaps a court in a different venue.

2. Your offsite DR should be with a different colo company and with a different network provider (ours wasn't - shame on us, just never thought of this scenario). The DR companies should have no relation to your production colo company and network provider. We planned for power, network, fire, terrorists, etc., just not multi-site FBI seizures. We probably need a criminal mind to consider this as a scenario. Now you don't.

In this case, it seems to be fully protected that offsite Disaster Recovery Center should be located outside of U.S. Jurisdiction. Would you concur as a legitimate business owner?

3. You should have enough reserves in the bank to be able to buy all new equipment because if the FBI seizes your equipment, they will keep it until they have analyzed all of it. That takes many months. You need the reserves because even if your DR plans work, you now need another site for DR the minute your main site is seized. We had buy all new equipment over the last 5 days even though we will get our seized equipment back some time in the future.

This is extremely tough for Enterprise and even Mid-Tier companies, who's IT budgets are already stretched thin. Now law firms, medical record providers, ISP's, Colo Providers. Need to somehow convince their board or owners that duplicate equipment needs to be purchased, that may never be used. In the case of Liquid Motors that would mean having $400,000+ of SAN's/Servers located outside of the United States, that again MAY never be used. This is going to be hard to justify on any companies balance sheet in terms of Return on Investment, insuring their company can continue to operate. Not to mention that these costs are recurring, and a duplicate mirror of the environment ideally has to be made, which means annual purchases at multiple sites.

4. I would recommend using virtualized servers and keep images of the servers off-site so once you buy new servers, you can quickly get them up and running. The backups they provide you will not run on other equipment. (i.e. it is not dd images). Our off-site images would not run on the new equipment either as servers have changed so much in the last 3 years. We had to build servers from the ground up and restore just configuration.

This may not be a bad idea, again depending on your environment and systems that need to be brought online again.

5. Have great vendors. You will need them to help so you can get back up and running fast. Many components we had take weeks to order and some of our vendor expedited delivery to help us out. They also provided on site engineers to help reconfigure the new environment. We now know who to do business with in the future.

Great point about having good vendors, that hopefully will help you out in a pinch, and possibly loan you temporary equipment, while you wait patiently for the FBI to return yours.

The unfortunate situation is the FBI is trying to catch bad guys and I support their intent. I just don't support their execution. The collateral damage they inflicted has caused more in losses for the innocent businesses affected than the alleged crimes of the people they are after. They do not understand colocation or data centers, nor do the judges. That is clear from their actions and the discussions we have had with them.

I too applaud the effort of the FBI to catch the bad guys, and think that the warrant should have been executed, just not to the extent that was granted. The warrant from what I have gleamed from reading the reports from legitimate businesses, original warrant served to Michael Faulkner, and the Liquid Motors docket, seemed as it was overly broad. Hopefully once we see the second warrant issued to Core IP and as this case unfolds “we will see the need”.

Also If you could comment on your companies take on the FBI requesting to have forensic images of all of your data and encryption keys, so they can look for evidence. This has been troubling to many Colo and lawyers I have spoke to about this case, since your company presumably was not involved in the fraud nor did you provide your upstream provider Core IP Networks, login and passwords to your machines. Does giving the FBI access to your confidential files and those of your clients, lawyers, et al trouble you from a legal civil rights/liberties viewpoint? Or if you do not want to comment from your own companies viewpoint, how about if you were a law firm that had equipment in the same facility and your confidential client files are being seized by the FBI.

My father passed on some wise words to me once...

"You are rarely going to be the smartest person in the room... if you are, you're in one damn small room."

Would small include, say, an 8x8 cell?

Somewhat ironically, they will likely end up the smartest guys in the room. For the next 5-10 years anyway.

I would like to have the answers that were posted about why Faulkner used phony or fraudulent papers to set up his Ds3's, and why he used them or decided to. I also read his blog at uwwwb and found some interesting things that I thought to post here, especially since Faulkner is posting here. Maybe he will respond or maybe not.
Actually, user Limit3d1 with one post to your name, you're building a bigger case against Faulkner than his case against the FBI, and entirely on inuendo. If we're to believe you, we'd be much more likely to believe him.

Actually, user Limit3d1 with one post to your name, you're building a bigger case against Faulkner than his case against the FBI, and entirely on inuendo. If we're to believe you, we'd be much more likely to believe him.

Actually, there are many people here with post counts higher than yours, user jlasman with 35 posts to your name. I asked Faulkner those questions as well and I want them answered.

P.S. Innuendo, my ass. Read the search warrant and see how much money Verizon and AT&T lost just on those two DS3s that haven't been paid for.

I read through the PDFs that ppphosting linked and it confirmed my original assertions of unreasonable collateral damage. I find it appalling that one of the reasons cited for the delay in returning equipment was, "...the speed of this copying was subject to the availability of hard drives onto which the data can be copied." And more appalling was the suggestion the plaintiff (Liquid Motors) should provide some blank drives: "The extent that plaintiff could provide blank hard drives onto which the copies could be made would facilitate the speed with which the data copies could be returned to plaintiff."

But the punchline is the bottom line: Liquid Motors is effectively out of business, and in breach of their contracts with dealers across the nation, because they were (innocently) swept up into an overly-aggressive FBI raid.

Furthermore, this collateral damage to Liquid Motors is allegedly causing additional collateral damage to dealers nationally, in that they are unable to manage their inventory and advertising while Liquid Motors is offline.

I read through the PDFs that ppphosting linked and it confirmed my original assertions of unreasonable collateral damage. I find it appalling that one of the reasons cited for the delay in returning equipment was, "...the speed of this copying was subject to the availability of hard drives onto which the data can be copied." And more appalling was the suggestion the plaintiff (Liquid Motors) should provide some blank drives: "The extent that plaintiff could provide blank hard drives onto which the copies could be made would facilitate the speed with which the data copies could be returned to plaintiff."

But the punchline is the bottom line: Liquid Motors is effectively out of business, and in breach of their contracts with dealers across the nation, because they were (innocently) swept up into an overly-aggressive FBI raid.

Furthermore, this collateral damage to Liquid Motors is allegedly causing additional collateral damage to dealers nationally, in that they are unable to manage their inventory and advertising while Liquid Motors is offline.

I feel for any truly innocent people caught up in this but from what I gather part of their problem is having all of their eggs in one basket.

Also...

"All four of these individuals had numerous criminal charges associated with them, including [charges of] various frauds, interfering with law enforcement officials, violent crimes, and illegal possession of weapons,"

There was nothing overly-aggressive about the raid. These guys are shady, scandalous, slimy, narcissistic, felonious low-lifes.

Could the FBI have handled it better, as to not disrupt legit people involved? I can't answer that. But I can say that blaming the FBI for this situation is asinine.

I read through the PDFs that ppphosting linked and it confirmed my original assertions of unreasonable collateral damage. I find it appalling that one of the reasons cited for the delay in returning equipment was, "...the speed of this copying was subject to the availability of hard drives onto which the data can be copied." And more appalling was the suggestion the plaintiff (Liquid Motors) should provide some blank drives: "The extent that plaintiff could provide blank hard drives onto which the copies could be made would facilitate the speed with which the data copies could be returned to plaintiff."

But the punchline is the bottom line: Liquid Motors is effectively out of business, and in breach of their contracts with dealers across the nation, because they were (innocently) swept up into an overly-aggressive FBI raid.

Furthermore, this collateral damage to Liquid Motors is allegedly causing additional collateral damage to dealers nationally, in that they are unable to manage their inventory and advertising while Liquid Motors is offline.

It's unfortunate, yes, but there should always be a disaster recovery plan in place that isn't just limited to Acts of God.

They should have had geographically redundant servers available. Even if they're just cold spares, they still could have had them up and running in minutes and had the data from their offsite backup *cough* transferred to those servers within the hour.

Unfortunate? Yes. Can we blame them for their main servers being confiscated? Absolutely not. Can we blame them for improper planning? Absolutely.

Everyone who at this moment has their network fully duplicated to a standby DC, raise their hand.

Gotta be honest, even as an obvious outsider/novice, I always assumed redundancy was SOP. I'm somewhat surprised that anyone who relies on such services to keep their business running smoothly would be without.

Who would you be blaming had a tornado taken this DC out? It's all up in tornado alley.

Everyone who at this moment has their network fully duplicated to a standby DC, raise their hand.

*raises hand*

Let he who is without sin cast the first stone.

I have two geo-redundant servers just for my personal website. Short of cost, everyone else has no excuses.

Gotta be honest, even as an obvious outsider/novice, I always assumed redundancy was SOP. I'm somewhat surprised that anyone who relies on such services to keep their business running smoothly would be without.

Who would you be blaming had a tornado taken this DC out? It's all up in tornado alley.

At least one business had redundant equipment hosted in another DC but the other DC was raided as well.

http://www.webhostingtalk.com/showpost.php?p=5981332&postcount=81

Thank God our data center is in Canada, we never have problems like that ! Sorry to hear that for those who have been affected hope you guys can recover from this. Good luck

At least one business had redundant equipment hosted in another DC but the other DC was raided as well.

http://www.webhostingtalk.com/showpost.php?p=5981332&postcount=81

Great post dotHostel. While it is easy to say "sure they should have redudant equipment in another colo". But As I posted before, having sold data solutions for numerous providers, consulted on Disaster Recovery Plans, and worked in the trenches. This type of scenario, to my knowledge, and many security Professionals that we are discussing this case on Linkedin.com's Information Security Community (30,000+ Members), has never been contemplated.

To demonstrate how costly such a plan would be to safeguard against. I am attaching the full amended complaint which outlines the $400,000 of equipment that Liquid Motors would have had to purchase at their alternate site. And already has had to purchase replacement equipment for their SAN array.

Simply put, could you convince your executive leadership that "hey boss we need to buy half a million dollars - into the millions of dollars of equipment of DR equipment", because someone in our datacenter might be doing something shady? I wonder what commercial underwriters and the legal lawyers are thinking about this type of scenario… Oh " yeah and hey boss all that encryption software, and such we put on our equipment to insure our investors and clients our systems were Sox, Hippa, PCI compliant, the FBI would like to retain our hard drives and encryption keys so they can check it out." I know they have stated they we are not the primary target of their investigation, but they want to make a copy and hang on to it regardless.

PS: I had to upload the amended complaint as two files to keep it under the limit; also the full complaint is there. The document states pages 23/50, however when it was scanned and uploaded to Pacer another felony case was attached accidently.

Thank you for posting this. I noticed a lot of these and other discrepancies/red flags in everything this guy and the Core IP guy have said since this all went down but I was too lazy to run them down.

I'm all about some innocent until proven guilty but there are times when things are just so painfully obvious that it's hard to take the accused seriously. Innocent people don't threaten the FBI and witnesses.

From their coordinated and instant blaming of the FBI, code words, ever-changing story, warez forums and just plain stupidity it's obvious that these cats are up to no good and they're just shocked that anyone was able to figure it out. They are, after all, the smartest guys in the room.

Enjoy the pen, ladies.

I have not ordered TDM or VoIP Services in years, much less fraudulently. I was not involved in the day-to-day operations of any of the affected companies, and I have not been involved in "telecom" since my ex-partner now informant,Marcus Wentrcek, destroyed Premier Voice, my only venture into VoIP. You can say whatever you want, but I know what I did and didn't do and...I didn't fake any documents, I didn't order any service, and I didn't sell anything I didn't pay for to begin with. I've been involved in a completely different industry for quite sometime. When I did have a role in a VoIP Company, namely Premier Voice, Marcus Wentrcek was in charge of all carrier and client relationships, my role was that of an investor. An investor that got suckered into spending hundreds of thousands of my own money in a VoIP project when the partner playing the technical lead couldn't setup his own soft phone. I didn't know anything about VoIP, and don't know a whole lot more about it now than I did.

And I have threatened no one, I am a firm believer in Karma. Beyond that, with all my personal information in the press and all over the Internet now, why shouldn't theirs be? I owe them nothing. And there is a big difference between a warez forum and a network security forum. I've never had anything to do with any illegal distribution of copyrighted software.

If it's so painfully "obvious" explain why the FBI and US DA don't have a case yet...gee, maybe you don't have all the facts, maybe you haven't spent 6 to 8 hours a day with attorneys like we have...maybe you should keep your uninformed opinions to yourself? If your not inclined to do that, at least keep that bs off my blog you 4sscl0wn...

I'm sure if you have a lawyer that they've advised you not to make any public statements on this matter lest you expose yourself to a litigious situation. You might think what you've written is benign but you never know what will come out in court. A close associate of mine found out the hard way what spin will do.

wow, that's pretty crazy BUT I guess they did have some cause if the network owner was really involved in a fraud, but dang, jerking out all the boxes, ouch! But I'm wondering what the servers had to do with it. I mean was it done by billing or they were doing something on the servers that was causing the fraud?

I would bet it was most likely some billing fraud and the servers had nothing to do with it. They just wanted to pry and see what kind of other illegal activity he may have been involved in.

I think its only going to get worst, America and most other developed nations are becoming more socialist everyday. An d what was that bill they passed the other day? Something like they wanted control to cut off the entire Internet in case of emergency. That is extremely fishy and diabolical sounding, never should they have an excuse to do that.

Its only gonna get worse people, that would simply be a nightmare to go through if they really was jerking boxes out over one client and all your servers were down. That would totally ruin your business and most likely ruin the businesses of many of your clients.

I guess there is no way to fight it, the government is only becoming more powerful and they do what they want when they want no matter how many innocent people get hurt, I guess there is no bucking the system.

Its gonna get worse then just stuff involving ISPS its going to eventually effect the average citizen as well somewhere down the road. God help us all...

I have two geo-redundant servers just for my personal website. Short of cost, everyone else has no excuses.
If it was as simple as colo'ing a couple servers out of state, I'd do that in a heartbeat.

But this isn't about a few bucks. Real equipment is expensive, and that's double the colo fees each month whether you have a disaster or not.

(In the case of Liquid Motors, it's upwards of $400,000 just for the equipment alone.)

Speaking for my company, we could not mirror everything we have out of area without raising our prices. And we all know how receptive customers are to price increases, even if it's for their own good.

If it was as simple as colo'ing a couple servers out of state, I'd do that in a heartbeat.

But this isn't about a few bucks. Real equipment is expensive, and that's double the colo fees each month whether you have a disaster or not.

(In the case of Liquid Motors, it's upwards of $400,000 just for the equipment alone.)

Speaking for my company, we could not mirror everything we have out of area without raising our prices. And we all know how receptive customers are to price increases, even if it's for their own good.

There's only one issue I want to address with your statement - companies always assume they need to mirror everything. That's actually not the case if you have an operation so large that true mirroring redundancy is unfeasible. In the mainstream hosting market, I'd say it's the responsibility of the client to ensure that they have other systems available to them. It's obviously financially unfeasible for a data center to have an entire backup site for all their customers. Instead, the customers themselves need to take care of finding a redundant service.

Just provide redundancy for your essential services - your website, your email, communications mediums that allow your customers to find out what's going on in the event of downtime. Then when they know what's going on (and if they know what they're doing), they can begin to utilize their backup systems for their essential services.

It's not true geo-redundancy, but it's at least a feasible compromise between disaster recovery and fiscal responsibility.

More than 95% of our business is fully managed application servers. We don't offer self-managed servers, so there is basically nothing we can lay back on the customer... other than the decision whether or not to pay extra for redundancy.

But it's also something we'd be unlikely to do as a one-off case. I've pitched this very idea to our largest clients and to a number of our small/medium clients that I believe could justify the expenditure. Many are, quite frankly, very interested in redundancy but have made it clear they aren't willing to spend a dime more than absolutely necessary until the economy improves.

For many, the annual cost of redundant servers would mean the difference between keeping, or laying off, an employee.

As I along with many of the ISP's/Colocation/CLEC providers on this forum, want to know how the 100,000 VoIP 911 (residential and business customers) can be left without emergency services, prisoners in three states without access to phone lines. Not to mention all of the legitimate businesses that have to hang on and wait patiently wait while their businesses are destroyed!

How many actual legit businesses are you talking about ppp? Outside of Intelimate and 'possibly" Liquid Motors, who as I understand is a company that basically spams your email box about interesting offers from various car dealerships that you may or may not have signed on with. How many actual businesses are you discussing? Because you make it sound as if most, if not all of Faulkner's operations were above board and legit, which so far we have seen the opposite being true.

Plus, are you actually standing up for inmates and rapists and murderers and child molesters having their phone privileges taken away for a short time lol?

From my understanding of the affidavit, and this is also just a basis showing probable cause, and not the entire disclosure of what they knew, when they knew, and what they based the raid on. They took everything because this was a sophisticated operation; whereby they believed (and I have no reason to doubt their belief so far) that Faulkner - in the guise of his ongoing criminal enterprise - could have in fact stored critical information/data etc. on servers not belonging to him, to in effect hide or disguise his underground activities.

I think its basic LE-101 that in a case such as this, with a defendant such as this, and using statements from a "reliable" (at least to them he showed being reliable in the past) informant that stated that almost zero legit activity had been going on with the defendant. Based upon that, I am sure that everything had to go or get seized so they could preserve evidence and look for other ongoing investigations to see if they in fact could connect even more dots to this empire that Faulkner had going on. It isn't a stretch at all to "assume" that he may have kept data on servers in his facility to hide his ongoing enterprises. It was also stated in the affidavit that Faulkner kept a drive with him with all critical data on it, as well as keeping this data very confidential. Assuming that he thought about a backup to that if that drive was ever confiscated, he may also place this data on servers in his facility as a further redundant backup. The catch would be if that data or server were ever compromised, he could then claim that it wasn't his server, therefore that data didn't belong to him. Drug dealers (not saying he was/is one) do this often by placing drugs in a car or other innocent place to disguise ownership of the drugs if ever found. I don't really think the FBI had any choice. It was either or.

Or do you actually think that they were going to sit on the place until everyone was contacted and showed up at the Colo? I mean, what a waste of resources. It could have been days, weeks, or even months before everyone was able to be contacted to come in to the Colo; thus compromising their time, evidence, and everything else.

Or I take it that you think that a sophisticated criminal will just give up the goods post haste when approached and just say this server and that server belongs to me, and the rest (especially if I hid my encrypted data on them)are not mine, and I have no ownership over them. And then the FBI will just haul away forensically clean servers, thus compromising their investigation by allowing the criminal defendant to point out only those things which are his, and or known by him to be clean? That would be like allowing the criminal to decide the case against himself wouldn't it?

I think in this case they had no choice. They did what they had to do to "contain" and "preserve" all data associated with a known criminal defendant.

Collateral damage happens all the time. You can't plan 100 percent for every eventuality. If you could, we would not have lost anyone in Iraq and those WMD's would have been there right?

And that of course is a broad stroke using a very wide brush.


I will pose the same question again:
What would have happened if they performed a similar raid on a large datacenter? What would have occurred if law firms; hospital HIPPA records, transcription providers that provided legal, government or other both time sensitive and confidential, CPA offices records all had their servers carted off. Because these companies or firms rented collocation space?

I think its safe to say that those companies would not be hosting with such small time fly by night companies. Major companies that have major data such as the above probably use major companies to host or colo with or even they have their own data centers, and probably are not worried too much on this score. This was an obvious (at least it is to me)small time fly by night nickle and dime operation that changed addresses as much as they changed their shorts. Most major companies will not elect to host with such companies in my opinion. And they do major Due Diligence prior to moving important or otherwise mission critical data to a hosting company in my opinion. I am sure there are many on site inspections, insurance companies to be contacted, DUN reports requested and so forth on any companies they decided to host such mission critical data as you outline.

I think in your case you are making a mountain of of a molehill, but, this is not to say you are not correct in your thinking, as this could reflect on the state of the way things are today. However this activity of seizures has been going on since the 80's with servers, data, etc. being raided and or confiscated, and so far after a few complaints the issue becomes moot and people move on. Those that don't are usually caught up in the initial wave and can't let it go for some reason, thinking that this could happen to them. Could it? Absolutely. Does it as a matter of routine? Not very often.

Therefore it's not that big of a threat. Plus, since 9/11, government has extended powers, and they can be used, and have been used on occasion to make a point. Your data is not safe at border checkpoints. Your data - and your encrypted data - can be searched at airports. Password keys can be demanded of you, and you 'MUST" comply if asked or you just won't fly. This is nothing new. Data is not safe, and easily obtainable by the government for any purposes they deem required. The rational is if you have nothing to hide, you have nothing to fear. There are hundreds, if not thousands of posts on this subject that are ongoing throughout the web. You can easily take those same discussions and transpose them to a data center. They can pretty much do what they want when it comes to an investigation. Sure you and others will holler and scream, but in the end, compliance is mandatory - and you will comply or suffer some defeats for "failure to communicate" with them. Is it right? Of course not. And I am not an advocate of that type of activity. But it has been talked to death for a very long time, and I can't believe that you have not heard of it or even thought about it when it comes to this type of case. Again, this is nothing new. It has happened in the past, and basically there isn't allot anyone can do about it.

You can plan as much as you can, do major DD on your upstream suppliers, and always have redundancy built in. The more critical the data is to your business, the more redundant backups you need. That is Computer 101..Your going to tell me that Liquid Motors is losing millions and only had one frigging backup plan? OK, well, if that is the case, shame on them. Must be a management issue. And I am not taking their case lightly. I am just saying look, if you have data that is mission critical, and it's worth millions to you, then please, by all means, have as many backup plans as possible. As for 400k to replace what they lost, well, since I don't have server specs and how many servers they had and yada yada, I can't really comment on how much it would cost to replace them. Truly, in this day and age, with servers being about as cheap as they have ever been, I highly doubt (well I at least question) 400k as a loss parameter. It sounds more like an inflated price thing; whereby you use that as a basis to sue for damages, then trebled for punishment of course, which gains you millions if proved.

And by the way, government does that all the time. They inflate losses to companies to make a point, and well, companies do it too. Everyone always says my sh!t only deserves to be in a gold toilet. Is it true? Hardly.


But I feel the FBI should have planned better to be faster in doing the "forensics" on the amount of servers they confiscated to reduce any impact on any innocent businesses.

In a case such as this, with the limited data we have to look at, which is the affidavit. It appears that criminal activity was a major business activity with the defendants. The amount of "legit" activity was, according to the affidavit, limited. I have seen all these posts about hundreds or thousands of companies affected. But few if any have posted the actual list of the companies affected. Liquid Motors being the only one so far willing to say yes, we were hit. I for one would like to see a list of these so called hundreds, if not thousands of legit companies this guy had in his center. Just curiosity I guess.

Of course, that will probably not happen. Until then all we have is the initial data or the affidavit to go on, which claims, very few legit businesses in the facility. I am sure there are some, maybe even more, but until we have that data, all we have is the affidavit, and that doesn't give us any idea how many real businesses were affected. Could be 5-7, 8-10, 20-30, or even 1-3, we just don't know at this point.


Clearing out an entire colo-- customer equipment, along with the host's equipment-- seems pretty hard to justify, if this is just over some money owed to a telecom.

The way I read it is that the case was made already. They had enough for an indictment based on the fake docs used to obtain credit for services. The additional charges of losses were just secondary to that main charge, which was; using fraudulent data to obtain services and not paying for them. The millions of dollars lost made it a federal case they decided to take. As any loss over 1000.00 in one given year can be federal. Often it won't be. The case has to produce a threshold for federal people to get involved. Thresholds are determined by the office and or jurisdictional area they are in. The time involved to make the case is also a part of it. The amount of fraud, the amount of people involved, (more is better for them) and the time it has went on for is also a parameter. They already had a case. They didn't need the servers to prove it. So the raid was "possibly" for

1. Investigating other potential scams that did not show up in the initial scam.

2. To recover fruits of the original scam.

3. To ferret out other involved characters not initially charged or investigated.

4. To connect the dots to other ongoing investigations they had from other offices.

The servers or the facility and all data repositories must therefore be secured in order to continue or complete an ongoing federal investigation. Again this is a criminal investigation, not a civil investigation. Therefore they have a duty to protect and preserve any and all related materials that could help them further their aims of shutting down other frauds, or the current fraud or prosecuting others involved ancillary to the initial complaint. The defendants, are by nature of the affidavit, sophisticated criminals. Therefore they had no choice but to do what they did so they can further examine areas in which these "purported" technically savvy criminals were involved in. The affidavit has in it a discussion about "Spamming" (which we are all against correct?), drugs, weapons, past problems with Law Enforcement, etc.

Therefore they are looking, and probably hope to find much more criminal activity with this company. And where to find it? Where to look? Why on the servers of course...


In fact, they are busily trying to wrest control of the disputed servers back. That being the case, any allusion to volunteering is plainly ludicrous.

And of course probably talking at the same time about what they know about what has been going on. (Only speaking of the so called employees of course)


If it is a large criminal operation and you refuse to cooperate with the investigation they WILL find a way to force you "downtown."

That is a fact Karl.


Not alleged drugs farmer. Alleged Playstation user running pirated games -- a very dangerous person requiring 15 police cars and SWAT team.

No. Try sophisticated criminals ripping off Telcos thus having those same Telcos pass the savings of their losses onto you and me and everyone else. Not to mention, drugs, weapons (in the past) other investigations pointing to threats against LE, and other sundry items these defendants were "supposedly" involved in..

They are very brazen don't you think? I mean here we have Faulkner commenting on all the talking points which show him to be somewhat deranged in his thinking patterns and somewhat threatening towards the FBI and or witnesses. A guy who can take a case or cases against him and turn it back onto the agents. A guy who says he will "BLEED' the system for all he can get for "catching" him at his scams. A guy who thinks LE is the "Gestapo", the Country he lives in is "Totalitarian", the people who raided him over his scams were "Storm Troopers", and on and on.

Does this sound like your average Joe Playstation player to you? I think not. I see a sophisticated above average criminal who has allot of anger management problems and a sense of entitlement, and can't figure out just how far a hole he has dug for himself or others. And to top it off, doesn't care. Why should he? He is going to prison. Why the hell you think he should now care about anyone else who suffered?

All he has been doing post raid is obtaining more credit he never intends to pay, and asking for others to donate to his cause, claiming he was not in fact a criminal, rather he was an honest as the day is blue businessman who has been accused wrongly. Of course it may well turn out to be that way, but in a way, at this stage, he is soon to be a defendant in a criminal case or cases. And he is out drumming up hatred, making threats against others who thwarted his plots, and basically refusing to take responsibility for his actions.


However, companies not involved in the facilitation of the crime that were renting space, should not be effectively put out of business, merely because their upstream provider has been alleged to have committed a crime**

OK, playing lead agent on the case and knowing you had to move quickly, and that maybe the defendants were getting wind of the heat coming down, thus an attempt to remove data and otherwise taint evidence might be made. How would you have gone about it? And use a cost base analysis please, and trying to keep it within a budget for the office you had.

It's a tough choice for the agents, and even tougher for the people who lost servers. But is that the agents problem or even his responsibility or is it the defendants?

I think it's Faulkner's AOR, and his scams which took people in are the main issue. People should be pissed at him, not the agents out doing their jobs the best they can. I think Lynd probably deserves a number of pats on the back. Instead he is taking heat for what he did or had to do in my opinion.

If you look at it from his end. He is dealing with or taking on guys who are probably "NOT" easy to deal with. They may have connections to other potentially radical support groups that make threats, pass them on to others, and or make life hard for those who come after them. Some of these criminals today do not care one whit about an agent or his life or lifestyle. It takes only one nut case to make a mountain of trouble (see Oklahoma, Waco, Ruby Ridge etc). This guy has had an army come out of the woodwork on other blogs and or news places to defend him where he has posted. All with the same type of militant posts. Calling Lynd a fascist, the raid akin to Obama taking our guns away, and all manner of other issues and derogatory statements.

These types of people multiplied by a force of ten can cause one hell of a drama/sh!t storm. The lead agent has to take all of that into account when making his case and doing his job. Yet all we have seen recently is how wrong he was, how stupid he is or was, how under trained he is, how much he sucks, how bad he is. Hardly "ANYONE" has made the case in his corner. In my view the guy took a hard case, investigated it, found the people responsible, and did his level best to preserve the evidence and get it to the prosecutors.

Just because the defendants took the major Telcos down a few pegs doesn't make it OK or right. It is quite possible that the defendants would have eventually taken Jo Colo Average down when the majors refused to do anymore business with them. They would have eventually looked for smaller companies to do their scams on, because they would have even less DD involved. Eventually they would have run into all the small guys who are in this business, and everyone of us would have taken damages far beyond what they have so far been accused of. Again though, that is convicting him/them in advance, and is probably wrong to do. But, he has in his dossier of posts so far played the part of an egotistical maniac, with a demand to be respected, and a demand to be noticed. I don't know, he seems like everything that has been said of him in the affidavit so far to me.


I'm all about some innocent until proven guilty but there are times when things are just so painfully obvious that it's hard to take the accused seriously. Innocent people don't threaten the FBI and witnesses.

From their coordinated and instant blaming of the FBI, code words, ever-changing story, warez forums and just plain stupidity it's obvious that these cats are up to no good and they're just shocked that anyone was able to figure it out. They are, after all, the smartest guys in the room.

I agree. I have wondered if I was the only one who saw through all of this crap lol. I don't know though, it's a quandary for all involved.


Actually, user Limit3d1 with one post to your name, you're building a bigger case against Faulkner than his case against the FBI, and entirely on inuendo. If we're to believe you, we'd be much more likely to believe him.

Innuendo? These were Faulkner's own statements on his blog that I commented on. And I presented with some of my own thoughts about them which seemed logical to me, but..maybe not to your liking :)

Sorry if that offended you.


P.S. Innuendo, my ass. Read the search warrant and see how much money Verizon and AT&T lost just on those two DS3s that haven't been paid for

Thank you RedTorch... I think it's the crux of the case itself. I assume he will say, "Someone else, maybe the informant, sent all that paperwork off. He had nothing to do with it, and never knew about it" lol. Who knows right?


Furthermore, this collateral damage to Liquid Motors is allegedly causing additional collateral damage to dealers nationally, in that they are unable to manage their inventory and advertising while Liquid Motors is offline.

I don't know. It seems that Liquid Motors says or acts like they are some 200 million dollar a year business. Maybe they are, but if they were, why didn't they have backups that could kick in when one site was down?

As for managing inventory, I didn't see anything listed that says they manage the inventory of auto dealers nationwide. I think they have a contract to send spam out to peoples inbox who sign up for information from online dealerships. Then they spam you with sales advertisements and deals aplenty. But managing inventory? Hrmm. I don't know about that. I don't really know much about them at all. Except to say, why no backups if their data was mission critical? They should have had servers mirrored in other locations, that way they would not be losing "millions" right?

Plus to be honest. I saw that request for relief. Truthfully? My opinion? Which is probably not worth much of course. But it was somewhat lame looking as far as court docs go. It repeated the same thing over and over, as if there wasn't much to say.

1. We are Liquid Motors.

2. We lost Data at XYZ Company.

3. We need that data back.

4. We are Liquid Motors.

5. We lost data, it's important to us to have it back.

6. We need our data and we don't want to be harmed again.

7. We are Liquid Motors.

8. We lost our data.

9 We need that data back, because they (FBI) had no reason to take it.

10. We are Liquid Motors..

I mean the request for relief looked about as lame as it could be in my opinion. I didn't see account statements showing millions of dollars being lost by Liquid Motors. Or here is our business losses to date, and or contracts lost. Or here is our customers screaming and walking away from us, which would have shown the reality of the losses in the case. Instead there was just the above, summarized in my recollections of course, which seemed to be a small time relief request which cost maybe 1500.00 to obtain. Again YMMV on my opinions.


This type of scenario, to my knowledge, and many security Professionals that we are discussing this case on Linkedin.com's Information Security Community (30,000+ Members), has never been contemplated.

It's strange to hear in these times that such scenarios have never been contemplated, especially since raids such as this have been going on for a very long time. I find it hard to understand that with all the information out there being posted daily, sometimes hourly, on raids, new government powers, servers being raided worldwide, FBI/SS Interpol requesting traffic from other hosting companies in other areas of the world just to track a few emails from some defendant they are looking into, that this has never been contemplated?

I don't know why, because the data trail is there for all to see, all one has to do is look for it. And 30k security pro's dont know? I find that hard to believe. Because if anyone knows what the current state of security is and what is going on out there, security people or industry people would know that fraud is a major reason why things are shut down, confiscated, removed, terminated, etc. The federal people have asked for and received data trails, traffic details, monitoring reports, community of interest requests on cell phone data, internet data, email data, IP data, the list goes on and on. Matter of fact there is a debate raging now in that very industry over the NSA taking over the cybercrime duties of the entire Justice Department.

How these security professionals wouldn't know or even discuss the ramifications of all that has been going on in the last 5 years concerning data is beyond me.


Simply put, could you convince your executive leadership that "hey boss we need to buy half a million dollars - into the millions of dollars of equipment of DR equipment", because someone in our datacenter might be doing something shady?


If the data was worth millions today, it would be worth even more than that later. So following that structure, sure, one would say backups upon backups are a requirement, less you suffer the fates for not doing it. Been there done that.

In this day and age, you cant trust anyone, especially with your data. Best to secure it best you can, with as many backups and mirrors as your budget will allow. Those are the realities of today.

Sorry this was so long. Just didn't want to make one post after the next answering each question I thought was interesting. If you read this far, please get a drink and go to sleep. :)

How many actual legit businesses are you talking about ppp? Outside of Intelimate and 'possibly" Liquid Motors, who as I understand is a company that basically spams your email box about interesting offers from various car dealerships that you may or may not have signed on with. How many actual businesses are you discussing? Because you make it sound as if most, if not all of Faulkner's operations were above board and legit, which so far we have seen the opposite being true.

Plus, are you actually standing up for inmates and rapists and murderers and child molesters having their phone privileges taken away for a short time lol?

Sir, can you please identify who you are, so we have a basis to go along with your interpretation's. You are fair to draw your own conclusion's, however I would like to know who I am speaking with.

As, for the companies affected: There is Liquid Motors, which is a legitimate company that pay's taxes, employees 20 people and did not provide Core IP with their login/password. In short, this means that their data was not able to be accessed by the alleged criminal defendants in this case.

To address your second point about standing up for inmates. YES! I am, they are people just like you or me, that at one time or another chose to violate the law. They do not deserve to have their phone privildges taken away, simply because the company that is used to provide the service was disrupted.

Perhaps you could contact the FCC or Citizens Unitily Board and ask them, what their response would be if Prison or ordinary Telco phone service was operated? If AT&T the local ILEC or CLEC service was interrupted.

As for the 100,000 (residential and business customers who had their 911 services interupted). Again what would have occured if any one of these people and perhaps you or your an elderly citizen had to contact emergency services and they died? Again, I can tell you that this is not to be taken lightly.

As for the people that are taking a certain side. I can tell you that I have provided several posts backing up the work Mr. Lynd did. I even included his discussion on forensic examinations. And on another related case that I have had telephonic, email, phone converstation with Mr. Lynd since early 2008.

http://blogs.technet.com/kaiaxford/archive/2008/06/26/the-security-guy-blog-adds-video.aspx
"Great video Kai! I have known Allyn for two year's now. He is truely one of the few people that understand complex IT law's."

http://blogs.dallasobserver.com/unfairpark/2009/01/in_dallas_this_week_the_worlds.php
Thank god the Justice Department has put these members’s behind bars. As an active informant into these cases. And having worked for many of the named telecommunication’s company's in this indictment. Having lost my job and well over $200,000+ in salary due to these individuals, opening up fraud orders with my user ID at one for-mentioned telecom companies. Having a young child contact, one of my “residence’s and place death-threat on my life”. I cannot express how much I would like to thank the entire Dallas FBI, DOJ, and network security professionals who brought charges against these individuals.

PS:Also if you can explain if you have any experience in IT, Forensic examination, legal training, accounting or forensic auditing? Wholesale CLEC operations...

Best,
Joseph Libuszowski
http://www.linkedin.com/in/libuszowski

You can say whatever you want, but I know what I did and didn't do

Let me say a few things Mike.

What you are facing now is of course a very trying thing in your life. I think you probably need to know a few things (maybe you already know) about the Federal system. In Federal cases, Federal court is a plea court. It isn't a trial court. Cases brought are won 90 percent or more of the time by the government. Fighting in them only costs the government more money, and when you do that, they make sure you take all the extra time that goes with that in time, jail time that is. Many people think at first they have it beat, but many find out later it's all about pleading instead. The case is won by points. Points are awarded for taking responsibility, cooperation, etc. Real points are taken away by the above. The more you do for them the less points you will receive. The less you do, the more you receive, and the longer the time you will do.

Points for past activity are bad, they add up for each time. Points are added for complexity. Points are added for dollar amounts lost. Points are added for major roles in the case, such as kingpin or manager of the activity. The more points you end up with, the longer the sentence.

I can tell you that the federal people do not take cases such as these without already having an indictment at the ready. As you may or may not know, a grand jury is just an extension of the prosecutors office. They can get you for jaywalking even though you truly didn't jaywalk. Indictments are assured post raids. They don't make their move or show their hand until they are ready to act. Your postings about how they don't yet have a case show that you may not know how they operate. I can assure you that the raid was more than likely just a preserve and protect future data deal. At any rate, you do have a huge amount of problems upon you. And I don't wish to make them harder for you by posting my thoughts or ranting about your case as if you were already convicted. While it does seem that way, this is only based upon the affidavit, and as such is discussed in that light only.

Here is what you may face in the coming days, weeks or months or even hours. An indictment and arrest. The case will more than likely be in the jurisdiction of the complainant. This means wherever their home office is based will be where it is located. However it could be right where you live, it all depends on what offices you used, and where they wish to work it out of.

A pre-trial hearing for bail. They of course will base the decision on bail from your community activity, as in close ties to, and any threats they feel you may or may not be to that community. Also, the ability to flee will be discussed. If you are an upstanding guy and do not have any problems they can point to, then more than likely you will be granted bail. 10-15 percent federal, paid to the federal government.

You will probably not be allowed the use of a computer pre-trial, even if that is your lifeblood. They will make demands on you which will be very harsh. You will probably have allot of problems with life, how to work, how to make money, pay bills etc. Pre-conviction or post indictment, not many will hire you. It will be one of the hardest things to deal with in life.

I can assure you that there is always a reason for how things come out. And the hope is that you will find them and be able to deal with them rationally. You will need strength beyond the strength you have ever had in the past. Much hardship you will face. You will find that family is probably the only thing that will guide you and or support you through these troubled times. I can say that God also comes into play as well. My hope is that you will take refuge in God's plan, and that you will have the strength and determination to stand up and make it through these troubled times and come out the other end wiser and a better person.

I know right now you feel allot of anger. But don't put it on display in public. You should not try your case in the court of public opinion. It is not the court that will pay for your defense bills or your house payments or feed your family.

The court of public opinion will only be there to talk about the outside stuff, and in the end, the only court you need to convince is the court you will face. Screw the public.

I noticed that you have used the press to make your case, then your blog, and even here. I can tell you that despite people asking questions on various places, it really isn't a good idea to answer them. The answers you need to give are to your attorney, and your family, and no one else.

In that light I would also say that everything you have posted so far will be scooped up and used against you when the time comes. This was a fatal mistake on your part. You will reap that one day and realize that it was a very bad mistake. I would suggest that you remove all posts, all blogs, and all related materials to the case itself from public view. While it's already too late, you could claim that under duress you made statements that were not in your best interest, and since you were under duress, you shouldn't be held accountable for them.

You should not talk about what is done to you will be done back to them. This is called retaliation. And it's a very bad thing when you will be looking for points off and bail. Making idle or derogatory statements/threats etc, will of course force your bail higher or cost you extra when it comes time to get those points reduced or even convince a jury of your innocence.

You may not think so, but everything you say is copied and sent on and attached to your case. Remember this. The federal government has no mercy. They have zero. When they decide to come after you, they will and often do make your life a living hell which has no relief. Understanding that only helps you to realize that no matter what, everything you say, everything you do, every act you make, will be looked at and judged. Do yourself a favor, come down from that buzz or high from all the attention and realize that everything written is only used later when you least expect it. It's not a war, even though you think it is. It's your life your fighting for. Once convicted, your life will never be the same.

If your innocent, it will come out, but allow it to come out in a court that decides your fate, not in the court of public opinion. Stop posting, stop admitting to this or that or explaining to others, even me, what happened, or who was responsible. We all have our jaded opinions of what happened and what really went down, and you don't need to answer to me or anyone else. All you need to do is answer to your attorney and the court. Forget us, forget blogs, forget trying it on those venues. It doesn't matter in those places.

No matter what I have said or will say, one thing is this, we all should have forgiveness in our lives and hearts. No matter what happens to you I know you have it rough, and I only wish the best for you and your family at this troubled time in your life. No one knows more than you just how bad it is now or could end up being later on. I can say this, and you may not believe it, but God does have mercy, even when people or governments do not. Take counsel in him, and while the going may get rough, have faith that God cares about you even in the darkest of times.

I hope the best for all concerned, those who lost and those about to lose. It's a terrible thing no matter how you look at it. And all one can do is pray for you and offer you moral support even when others will wish you hanged.

I know it may sound lame, but in a way, it's my belief that our faith is tested many times, and no matter what, as long as we keep that faith we will eventually win.

Good luck to you, and God go with you where ever you go.

Let me say a few things Mike.

What you are facing now is of course a very trying thing in your life. I think you probably need to know a few things (maybe you already know) about the Federal system. In Federal cases, Federal court is a plea court. It isn't a trial court. Cases brought are won 90 percent or more of the time by the government. Fighting in them only costs the government more money, and when you do that, they make sure you take all the extra time that goes with that in time, jail time that is. Many people think at first they have it beat, but many find out later it's all about pleading instead. The case is won by points. Points are awarded for taking responsibility, cooperation, etc. Real points are taken away by the above. The more you do for them the less points you will receive. The less you do, the more you receive, and the longer the time you will do.

Well regardless of who you are,and if you feel to make that known. Your understanding of the federal legal system and advice to Mr. Faulkner on his legal case ahead of him. And whom I have been racking my brain just trying to attempt to understand, shows through.

If I were Mr. Faulkner the "last thing" I would do is put up a forum/blog and attempt to incriminate myself. Whether he did or did not engage in piracy, by linking to offending material, which based on my research and historical digging seems to be what he may have done. Among more than likely committing software piracy, which I am sure companies like Microsoft will also be very happy to press similar charges against.
Mr. Faulkner: I will give this one piece of advice to you Sir. Do not underestimate Mr. Lynd's schooling or achievement's by any means. He is very respected in his field, and the fact that he chose to serve his country and receive training from the military and FBI will not get you any 'points' in court. Especially, when you bring up that he did not graduate from MIT or CalTech (please for your own good, stop watching movies or TV fiction).

What you had forgotten to include in your characterization of Mr. Lynd was:

"As an aside, it probably did not hurt that I had bought my first computer as a teen (an Apple II the one which only had an integer math coprocessor - floating point was an add in chip) and that my father sold PDP-11s which I had learned to program so that I could get Hunt the Wumpus working (Byte magazine had lots of great code in the back). As a West Point cadet, I was also required to learn PASCAL (does anyone even use that anymore?).

The reality is that most of my computer education has really come from on the job training, we have an extensive curriculum and all sorts of continuing education aimed at keeping us proficient. I basically just got lucky by being in the right place at the right time.

Most of the agents coming in now who work Cyber had extensive backgrounds as Unix Sysadmins at places like Lockheed or Sprint or were Oracle database programmers or Cisco engineers or the like. Almost all of them have degrees in computer related fields and have all of the industry standard certifications.

If this kind of work intrigues you, we are always hiring and you should contact your local FBI office and ask to speak with their recruiter."

[snip]

There's nothing anyone could say or do at this point that would ever overshadow your thoughtful, caring and humble advice. I applaud you for reaching out to Mr. Faulkner on personal levels that no one else in this community could even begin to fathom. You have earned yourself a great deal of respect in my mind - well done!

Starting, operating and maintaining a business of any size is not easy. It is not free. It costs alot of money and alot of time. Employees and their families depend on the earned income. Other businesses revolve around your business. Vendors, banks, insurance companies, accountants, lawyers, utilities, your customer's customers, and local, state and federal tax collectors just to name a few.

If anyone here has built a business from the ground up, sourcing money, equipment, supplies, hiring employees, paying the bills, fighting for your money when it is taken from you or owed to you and dealing with the day to day tasks of management knows how hard it really is. It is far more than going to work 5 days a week for 40 hours and collecting a pay check.

For anyone to say "oh well, they should of had a better plan" has no idea of the tremendous amount of money and time that is spent to become successful. It does not happen over night. It is a long, expensive uphill struggle every single day.

When someone you have never met, someone who does not understand what a business is, how it works and what it takes to keep it running, shuts you down because your neighbor has done something wrong, or that someone made a mistake and destroyed everything that you have worked for over the years in a blink of an eye, you will not be saying to yourself "damn I should of had a better plan". You are going to place the blame directly on the person who caused the destruction and that person is directly responsible for thier actions.

Maybe Business 101 and Economics 101 should be a prerequisite to LE-101 so that honest, hardworking, tax paying people aren't destroyed and put out on the street. Innocent businesses should not be victims.

I have not ordered TDM or VoIP Services in years, much less fraudulently. I was not involved in the day-to-day operations of any of the affected companies, and I have not been involved in "telecom" since my ex-partner now informant,Marcus Wentrcek, destroyed Premier Voice, my only venture into VoIP. You can say whatever you want, but I know what I did and didn't do and...I didn't fake any documents, I didn't order any service, and I didn't sell anything I didn't pay for to begin with. I've been involved in a completely different industry for quite sometime. When I did have a role in a VoIP Company, namely Premier Voice, Marcus Wentrcek was in charge of all carrier and client relationships, my role was that of an investor. An investor that got suckered into spending hundreds of thousands of my own money in a VoIP project when the partner playing the technical lead couldn't setup his own soft phone. I didn't know anything about VoIP, and don't know a whole lot more about it now than I did.

And I have threatened no one, I am a firm believer in Karma. Beyond that, with all my personal information in the press and all over the Internet now, why shouldn't theirs be? I owe them nothing. And there is a big difference between a warez forum and a network security forum. I've never had anything to do with any illegal distribution of copyrighted software.

If it's so painfully "obvious" explain why the FBI and US DA don't have a case yet...gee, maybe you don't have all the facts, maybe you haven't spent 6 to 8 hours a day with attorneys like we have...maybe you should keep your uninformed opinions to yourself? If your not inclined to do that, at least keep that bs off my blog you 4sscl0wn...

So we've gone from being completely broke and begging for donations on your warez site to marathon legal sessions in just a few days? Did you sell one of your three homes? Anybody else know someone who owns three homes and only has $50k cash on hand for the Feds to seize?

Also, why would you invest $600,000 in something you know absolutely nothing about? Is this all just a set-up for a plea of retardation?

What a tangled web we weave...

So we've gone from being completely broke and begging for donations on your warez site to marathon legal sessions in just a few days? Did you sell one of your three homes? Anybody else know someone who owns three homes and only has $50k cash on hand for the Feds to seize?

Also, why would you invest $600,000 in something you know absolutely nothing about? Is this all just a set-up for a plea of retardation?

What a tangled web we weave...

Very good point's, well he did say "I actually have an Ace in the hole, that I can’t mention to the general public yet. I assure you I have no intentions of throwing in the towel." So you may be on the right track of making a plea agreement.

I am not sure about the three homes, along with the along with the $50 grand in cash, if you can reference where this was obtained so we can make sure that everything is factually correct here. Since in his original letter, which he already has altered from his blog, he states he lives in a "$700,000 home in Southlake Texas"

Also his blog may not be up for very much longer, as the provider he choose has an "anti piracy, hacking or linking to such types of content policy," so his precious board that he operated in the past that linked to pirated material and may have hosted pirated material is no more. I have already notified his hosting provider and they are looking into the matter.

Very good point's, well he did say "I actually have an Ace in the hole, that I can’t mention to the general public yet. I assure you I have no intentions of throwing in the towel." So you may be on the right track of making a plea agreement.

I am not sure about the three homes, along with the along with the $50 grand in cash, if you can reference where this was obtained so we can make sure that everything is factually correct here. Since in his original letter, which he already has altered from his blog, he states he lives in a "$700,000 home in Southlake Texas"

Also his blog may not be up for very much longer, as the provider he choose has an "anti piracy, hacking or linking to such types of content policy," so his precious board that he operated in the past that linked to pirated material and may have hosted pirated material is no more. I have already notified his hosting provider and they are looking into the matter.


PS: It looks like Allyn has been assisting the webhostingtalk community since early 2005 as it relates to another internet fraud issue. You can find the history of that along with his contact information at

http://www.webhostingtalk.com/showpost.php?p=3289509&postcount=259

Welcome to United Police States of America.

Judge Denies Bid to Reclaim Seized Gear
April 9th, 2009 : Rich Miller

A Dallas judge has denied a company’s request to force the FBI to return storage hardware seized during last week’s raid of a Dallas data center, even though the FBI admits that the company is not a target of the investigation. Instead, the court directed the FBI to supply the company, Liquid Motors, with a copy of its data while retaining the hardware for further study.

“The United States confirmed that the Plaintiff is not a target of the criminal investigation, but that plaintiff’s equipment may have been used by members of the criminal conspiracy to conduct or facilitate the criminal enterprise,” Judge Jorge Solis of U.S. District Court wrote in his ruling, which has been posted by Wired’s Threat Level along with the filing by Liquid Motors.


Thus, while Liquid Motors reclaimed its data, it had to replace the confiscated gear, which included an EMC Celera NS352 storage array and a Dell AX100 SAN storage array. Liquid Motors provides online inventory management and marketing services for 750 auto dealers around the country. The company has the financial backing to replace the hardware, and is now back online and hosted at H5 Colo in Dallas.

The judge’s ruling, based on a private conversation with the FBI agent leading the case, suggests a scenario in which the affected companies may be able to get copies of their data, but the FBI will hold onto their servers and storage units.

http://www.datacenterknowledge.com/archives/2009/04/09/judge-denies-bid-to-reclaim-seized-gear/

If the data was worth millions today, it would be worth even more than that later. So following that structure, sure, one would say backups upon backups are a requirement, less you suffer the fates for not doing it. Been there done that.

In this day and age, you cant trust anyone, especially with your data. Best to secure it best you can, with as many backups and mirrors as your budget will allow. Those are the realities of today.

According to your thinking, depicted in your long post, backup is not a solution -- if the FBI can take everything, including switches and power strips, why not take the backups, servers colocated at other DCs, etc?

In Federal cases, Federal court is a plea court. It isn't a trial court. Cases brought are won 90 percent or more of the time by the government. Fighting in them only costs the government more money, and when you do that, they make sure you take all the extra time that goes with that in time, jail time that is.

---

You may not think so, but everything you say is copied and sent on and attached to your case. Remember this. The federal government has no mercy. They have zero. When they decide to come after you, they will and often do make your life a living hell which has no relief.

---

If your innocent, it will come out, but allow it to come out in a court that decides your fate, not in the court of public opinion. Stop posting, stop admitting to this or that or explaining to others, even me, what happened, or who was responsible.

Very instructive ...

According to your thinking, depicted in your long post, backup is not a solution -- if the FBI can take everything, including switches and power strips, why not take the backups, servers colocated at other DCs, etc?

Except that the FBI has no jurisdiction in places like...Canada.

Except that the FBI has no jurisdiction in places like...Canada.


Agreed. I would also recommend to move domain names to non-American registars located outside the United Police States of America.

I am not sure about the three homes, along with the along with the $50 grand in cash, if you can reference where this was obtained so we can make sure that everything is factually correct here.

http://www.uwwwb.com/?p=1

From his original post: "And to add fuel to the fire, the FBI took every dime I had leaving me to struggle to find a way to pay my 3 mortgages and feed my kids."

From post #19: "They took what I did have, personal, savings, college funds for my children, everything, and it was grand total less than $50K."

Even if he doesn't own three homes, does anyone here know someone who owns one home worth $700k and only has $50k between checking, savings, college funds, et cetera? He's either really bad with money or lying.

In my humble, non-professional opinion, of course.

What you had forgotten to include in your characterization of Mr. Lynd was:

"As an aside, it probably did not hurt that I had bought my first computer as a teen (an Apple II the one which only had an integer math coprocessor - floating point was an add in chip) and that my father sold PDP-11s which I had learned to program so that I could get Hunt the Wumpus working (Byte magazine had lots of great code in the back). As a West Point cadet, I was also required to learn PASCAL (does anyone even use that anymore?).

The reality is that most of my computer education has really come from on the job training, we have an extensive curriculum and all sorts of continuing education aimed at keeping us proficient. I basically just got lucky by being in the right place at the right time.

Most of the agents coming in now who work Cyber had extensive backgrounds as Unix Sysadmins at places like Lockheed or Sprint or were Oracle database programmers or Cisco engineers or the like. Almost all of them have degrees in computer related fields and have all of the industry standard certifications.

And so what? What is the relation between Pascal programmers and network engineers? Are you sure they know the Internet Protocol, know how a router works?

What proof they expect to find in power strips?

What is the relation between a router and SPAM? Is it not possible to send SPAM using a modem in bridge mode? How many people use broadband routers at home? Are they suspect to be spammers?

Are you sure it is a crime to upgrade firmware? Do you know how many security vulnerabilities were discovered in CISCO security equipments last week?

Most of the allegations are pathetic.

And so what? What is the relation between Pascal programmers and network engineers? Are you sure they know the Internet Protocol, know how a router works?

What proof they expect to find in power strips?

What is the relation between a router and SPAM? Is it not possible to send SPAM using a modem in bridge mode? How many people use broadband routers at home? Are they suspect to be spammers?

Are you sure it is a crime to upgrade firmware? Do you know how many security vulnerabilities were discovered in CISCO security equipments last week?

Most of the allegations are pathetic.

You brought up many valid points, that will hopefully be answered in the coming weeks/months.

The purpose of the post was to illustrate to Mr. Faulkner, that while he may have valid points about his customers that were affected by these raids. The case that is being investigated against him, and charges may be filled in. There are many very gifted men/women that are looking through his equipment at this moment. As the agent pointed out, "Most of the agents coming in now who work Cyber had extensive backgroundsUnix Sysadmins at places like Lockheed or Sprint or were Oracle database programmers or Cisco engineers or the like. Almost all of them have degrees in computer related fields and have all of the industry standard certifications.", and given the volume of the data they have seized and are working with. It is out of the question, that agents from other parts of the country may be called in to help analyse the data, or government contractors skilled in forensics could also be used as was granted by the original warrant.

And so what? What is the relation between Pascal programmers and network engineers? Are you sure they know the Internet Protocol, know how a router works?
Taken out of context, yes, knowing PASCAL means nothing when it comes to Internet Protocol. But for Christ's sake, consider this guy's entire background. Stop cherrypicking the facts that you want to misrepresent.

What proof they expect to find in power strips?

There is a little something referred to as fruits of the crime. Anything that was assumed to be purchased with funds received from criminal activity is subject to seizure as per the search warrant.

What is the relation between a router and SPAM? Is it not possible to send SPAM using a modem in bridge mode? How many people use broadband routers at home? Are they suspect to be spammers?

I'm not quite sure about this one, maybe he had a VPN into his office where he could send the spam from. A router in legal terms means anything from a Linksys broadband router to a friggin' CRS-1.

Are you sure it is a crime to upgrade firmware? Do you know how many security vulnerabilities were discovered in CISCO security equipments last week?

Yes, I'm VERY sure that upgrading with firmware you are not licensed to use counts as copyright infringement. Copyright infringement is a civil matter to an extent, but beyond a certain threshold it can become a criminal act. Security vulnerabilities or not, IOS is copyrighted software and theft is theft, plain and simple.

Most of the allegations are pathetic.
Thirty-five pages of connections linking Faulkner to numerous scams, fraud and copyright violations? All from the man who brags about his pirate lifestyle (Don't try to cover that up, we've ALL seen his posts) and lives in a ludicrously expensive home with ludicrously expensive toys? Do you REALLY think this industry is that profitable especially in this economy?

Yes, I'm VERY sure that upgrading with firmware you are not licensed to use counts as copyright infringement. Copyright infringement is a civil matter to an extent, but beyond a certain threshold it can become a criminal act. Security vulnerabilities or not, IOS is copyrighted software and theft is theft, plain and simple.

Sure using software/firmware without license is copyright infringement, but my point is not all firmware upgrade requires a new license -- one can't accuse as criminal someone without know the facts.

See this:

Message Type : Security Advisory

Title: Cisco Security Advisory: Multiple Vulnerabilities in Cisco ASA Adaptive Security
Appliance and Cisco PIX Security Appliances


Posted: April 8, 2009

Summary:

Multiple vulnerabilities exist in the Cisco ASA 5500 Series Adaptive Security Appliances
and Cisco PIX Security Appliances. This security advisory outlines the details of these
vulnerabilities:

* VPN Authentication Bypass when Account Override Feature is Used vulnerability
* Crafted HTTP packet denial of service (DoS) vulnerability
* Crafted TCP Packet DoS vulnerability
* Crafted H.323 packet DoS vulnerability
* SQL*Net packet DoS vulnerability
* Access control list (ACL) bypass vulnerability

Workarounds are available for some of the vulnerabilities.

Cisco has made software available, free of charge, to correct the problem.


Thirty-five pages of connections linking Faulkner to numerous scams, fraud and copyright violations? All from the man who brags about his pirate lifestyle (Don't try to cover that up, we've ALL seen his posts) and lives in a ludicrously expensive home with ludicrously expensive toys? Do you REALLY think this industry is that profitable especially in this economy?

Thirty-five pages of allegations. Pathetic allegations. AFAIK there are lots of conjectures and no proofs by now. He is not a convicted criminal to be called a criminal. I'm not sided with Faulkner or against the FBI. I just don't like the way the things were done -- Liquid Motors now is suspect of spamming!

Last, I guess making money in the US is not a crime (yet) as well someone living in ludiscrously expensive home with ludicrously expensive toys.

I have located a copy of Matthew Simpson's Resume CEO of Core IP, LLC & Managing partner in Solarity Communications LLC.

A full link to the filing made by Mark Foster attorney at Forstermalish and counsel for this filing for Solarity can be located at:
http://www.floridapsc.com/library/filings/08/10301-08/10301-08.pdf

Well regardless of who you are,and if you feel to make that known.

I'm just JAFO.

It's the internet, it's a series of tubes lol...

I was not involved in the day-to-day operations of any of the affected companies, and I have not been involved in "telecom" since my ex-partner now informant,Marcus Wentrcek, destroyed Premier Voice

According to the many statements you have made, both on Wired (as a main source for the story) and on your own blog, you claimed that Marcus Wentrcek "was in charge of all carrier and client relationships, my role was that of an investor.

Yet, in a post from this site

hxxp://voip.yuku.com/reply/421/t/Re-premiervoice-net-aka-pvoip-net-FRAUD.html

You were into an argument with a customer (markosjal) over refunding him his 45.00 dollars that he had on account with you. The rub was that you wanted him to place a minimum of 100.00 dollars on his pre-paid account with Premier Voice (your company according to your post), and because he could not keep up his 100.00 dollar minimum commitment to you, you claimed in an argumentative post that you would not refund him, not give him his credit, and that you would cancel his account and drink his prepayment. I quote you here,

And yet you made the remark that one of us should be shot for failing to promptly refund your $45.00, what is wrong with you? Well truth be told, here in Texas we have a very appropriate expression that maybe you have heard before: "Bring it!".

And since you're going to be this way about it, I'm personally going to go spend your $45.00 booze and Doritos, how's that?

Mike Faulkner, CEO
Premier Voice - Better Business VoIP

This post and thread was made on June 8, 2008. This was less than 10 months ago. You have claimed many times that you were not dealing with Client relationships, and that Marcus was the guy who handled all of that. Yet, here in the above post, you are the one handling a small 45.00 dollar customer complaint, and then berating the poor guy over his complaint. And saying since he couldn't read the contract, he didn't deserve his money back. It is clear by this thread above that you were in sole control or at least managed small client accounts as well as larger ones.

Investors usually do not involve themselves with such trivial matters. Your claim that you were only an investor would mean that you never became involved in such matters as client relationships or billing relationships.

Yet in this quote in the same thread, you discuss your title as head of the company.


And regarding my title, it's not to make me feel better, it's to distinguish me from those people that have trouble meeting $100 monthly commitments. I feel fine actually, absolutely fabulous in fact.

You seem to be very arrogant with this small client who was simply wishing for a refund of services he paid for. Your business acumen in this thread shows a person that is arrogant, snide, could care less about his customers who paid small fees, and you acted as an ass to anyone who questioned you.


In the thread here on WHT you claim


I didn't know anything about VoIP, and don't know a whole lot more about it now than I did.

In the other thread above, you show that you know quite a bit about VOIP.


The reason for this is that our CDRs are on 5 minute batches, and on a large account we could lose a substantial amount of money in between batches on an account pushing into the negative on this prepaid platform. You see, we didn't really design the platform for accounts your size.


And further you go on to say


I am sure you'll figure out Asterisk some day and be on your way to making millions. But in the meantime, we have to provide service to paying clients, that can read a contract, and meet our minimal commitment levels. We don't want your business if all you can spend is $50 here and there, try Vonage, I hear they need the business.

So when you do start making millions, and you sign up with Level-3, who has a $30,000 monthly commitment are you going to accuse them of fraud when they bill you for $30K when you only had $55.00 worth of usage? The last time I checked, we used contracts in this country to define the terms of a business arrangement, and our contract clearly states that there is a minimum of $100 monthly commitment. I honestly should bill you for the months you didn't meet it, and send that off to collections to appended to your credit report.

I think it's clear you know quite a bit about the business models of VOIP, and also the technical business of VOIP that you were in, as well as client relationships, how to deal with a low ball customer who demands a refund for fraud, and a host of other things related to the business you were in just 10 months ago. I mean it actually shows that you were very effective at treating even your smallest customers with a healthy dose of disrespect. Even going so far as to think about committing fraud against this customer by fraudulently billing him for his supposed commitment, which he clearly did not understand, and then sending that bill to collections, which would in effect deal a severe blow to his credit.

I honestly should bill you for the months you didn't meet it, and send that off to collections to appended to your credit report.

Pretty rough business dealings for this customer when dealing with you. You say in your blog that you made 15k a month, and spent 12k a month for your personal expenses.


I have had a personal overhead of about $12,000 a month for years, so going from making $15k a month to $0.00, was a bit of a transition.

Yet this lowly customer wanting 45.00 dollars back from you just couldn't get it. Was it because you were broke? I hardly think so. It stands to reason that if you wouldn't refund or payback a small guy his small investment of 45.00 dollars, then when dealing with larger clients you wouldn't pay them either. Because anyone who bitches over 45.00 dollars, is going to truly bitch when it comes to a larger debt or request for payment.

That is just logical thinking. You had an attitude in business which was very clear when threatened, you said and I quote,


Well truth be told, here in Texas we have a very appropriate expression that maybe you have heard before: "Bring it!".

It seems as if at this very point in time others were accusing your company of blatant fraud. And as a consequence of that series or thread, you suddenly sold the company that was supposedly making you a huge profit, and affording you the ability to make 15k a month.

Posted by jwaters1952 on July 17, 2008 23:18:01


Watch out for this company!! They will rob you blind and turn around and sue you. They have a history including Union Datacom and here are a few of their stories:


1. I just want to warn everyone to not even consider this company, they are a disaster. I personally believe that there are about 3 staff total in their 'DC' and that would not be so bad if they actually had decent response times, but if you submit a ticket to them (even critical status), if they respond anything like they did with us then you will wait for at least 4 hours for them to even acknowledge the ticket and many many more for them to actually do something about the problem.

2. GOD ALONE KNOWS WHAT THEY HAVE DONE TO OTHER PEOPLE. BUT I WILL PERSONALL MAKE SURE I PUT AN END TO THIS OPERATION.

HERE IS THEIR CONTACT DETAILS BELOW. I AM DOING A PERSONAL BACKGROUND CHECK ON ALL 4 OF THEM AND WILL POST ALL THEIR PERSONAL DETAILS ONLINE AS SOON AS THEY BECOME AVAILABLE.

3. After preliminary credit check we signed a contract with this company (Premier VoIP, Inc. / Premier Voice) and allocated them a $3000 credit line. They requested that we send them daily invoices to be paid either daily or collectively when the limit is reached. After two days of sending us their traffic and while they were half way through their limit they wired us $783.66 to cover the 1st day invoice (May 5, 2008).
Then it was on May 8, 2008 that they fully ran out of credit. We decided to suspend their account on $-3574.66 and ask them for immediate payment. Although we have been trying to contact them to settle this ASAP, they refuse to take our calls or even reply our emails or PMs.

The responsible person on their side introduces himself as a William Watts (Director of Carrier Relations).
Other people in their company include Michael Faulkner (CEO) and Brian Haney (Controller). They provide you with their financial reports and a D&B number which does really exist.
As mentioned above, this company owes us $3574.66, so be careful and don't trust them.

4. They stiffed us as well and they owe us close to $1,400.00 when they ran up some traffic through our Honduras route and never even made the first payment. Despite Michael Faulkner and William Watts, who I believe is the same guy using two different names, and their promise to pay, they never have paid us up to this day and I haven't heard a word from them (him).


At this very point you supposedly sold the company to someone else. Was this your "Standard Operating Practice" for a fraud after it was exposed?

There are no further posts made by you in this thread. You suddenly went AWOL and nothing else was discussed. You did not come back or offer any explanations like you have in the news stories of your raid or your subsequent problems. And I might add to that you have been very forthcoming when accused in the media, but not forthcoming when customers you did business with were complaining. You just disappeared on them, and then sold out the company to someone else. I think it is clear you knew what was going on, after all, you did in fact have day to day operational capability of Premier Voice during the time you claimed you were only an investor in the company.

It is also clear that you managed client relations as an investor, even with lowly 45.00 dollar clients. It is also clear that you relished talking their money, drinking it away, and buying chips and beer with it, and then saying laughingly that you were thinking about reporting them to collection companies and having their credit ruined over it.

Pretty sick business practices for sure.

As for what is going on with you currently, well, you say in your blog,


Meanwhile, I am a long way from Texas, and I am jumping through dozens of off-shore proxies to even connect to the site here.

This indicates that you are running. A businessman in shock over a raid that has no real investigation according to you would not run from his problems. Rather he would stay in place and face them with his attorneys in tow, and a healthy dose of fighting it in court spirit.

I doubt he would run off or use offshore proxies to connect to the net - thus masking his true location, unless he was running from his problems and not willing or able to face the charges ahead. It does seem that if you are resorting to using proxies, which in effect is hacking, I know that sounds lame, but it's still using someone else's hacked box for your IP, that you are attempting to flee, and that you do not wish to be found. You don't need a proxy to connect to your own blog unless you are living in fear of arrest or being found.


It seems everyone skips the part where the fraud is allegedly at least $1 Million Dollars, but I have no money.

You did have money, and this is a small point to bring up. It was claimed in the Wired article that you lost 200k. In your blog, your claim is 50k. Which is it?

Wired article


Agents also seized about $200,000 from the owner's business accounts,


Your blog

They took what I did have, personal, savings, college funds for my children, everything, and it was grand total less than $50K.

I am confused of course, and rightly so, because there seems to be your story, their story, and the public story. You mix fact and fiction, reality and fantasy. You make claims one day, refute them the next, and then go on to report a different story on the next.

Claims now are

1. Premier Voice was just an investment and you were just an investor and had no day to day client operational ability, leaving that to the informant who screwed you. Yet refuted by your posts 10 months ago showing you had day to day management, and dealt with small subscribers.

2. Financial confiscation from your accounts was 200k. You claim 50k.

3. Just when the Premier Voice was being called out as a fraud on 05-22-08, you were still in charge of day to day activities in June 2008. And when it became very clear that people were being ripped off and publicly complaining, you exited the company post haste.


05-22-08
VOIP THIEVES - PREMIERVOICE.NET - BE CAREFUL OR YOU WILL REGRET IT!!!!! THEY ALSO GO WITH UNION DATACOM

JASON WATTS
BRIAN WATTS
MICHAEL FAULKNER
BILL HANEY

ALL THE ABOVE NAMES PEOPLE ARE VOIP THIEVES FROM PREMIERVOICE.NET. THEY ARE THESAME CROOKS WHO STARTED THE NOW DEFUNT COLO4VOIP.COM AND RIPPED PEOPLE OFF. THEY SHUT DOWN THAT OPERATION AND ARE NOW STEALING UNDER A NEW NAME. THEY THINK THEY RAN OFF WITH OUR MONEY, BUT BE ASSURED WE WILL DEAL THEM A BLOW THAT WILL MAKE THE MONEY NOT WORTH IT. THEY ARE CRIMINALS WHO SHOULD BELONG TO PRISON CELLS AND NOT FREE ON THE STREETS. THEY SCAMMED US OFF OF $5000,


There's nothing anyone could say or do at this point that would ever overshadow your thoughtful, caring and humble advice.

Thank you for your kind sentiments.

I think he has allot of problems. Maybe it's the youth or the greed is good philosophy of today that gets so many people seeking money over everything else. In a way I feel for people such as him. But in another way when you look at the past, the lies come through, the arrogance shows. The living day to day fighting it out for every dollar he made, well, that just pales in light of so many that have lost so much in the past and continue to lose today.

Many do not see this past. Many only look at the main story and a few quick sound/text bytes he made and say he was wronged. But when you look deeper, you see a man who enjoyed his status, his power over others after he took them, and continued it over and over living high off the fat, enjoying every minute of it while everyone else suffered. That is the problem in having any respect for such people. But you have to still have forgiveness, because that is what makes us human.


It is an interesting story.. As for Agent Lynd, well, he is AirCav, and they love the smell of Napalm in the morning...Faulkner couldn't have had a harsher nemesis than that of Agent Lynd coming for him. Everyone should know that AirCav rules...But that is another story altogether.

So we've gone from being completely broke and begging for donations on your warez site to marathon legal sessions in just a few days? Did you sell one of your three homes? Anybody else know someone who owns three homes and only has $50k cash on hand for the Feds to seize?

Also, why would you invest $600,000 in something you know absolutely nothing about? Is this all just a set-up for a plea of retardation?

What a tangled web we weave...

I hate to pile on, but just to point out another inconsistency with this guy's story, from the forum at UWWWB: "Until then, I can't afford an attorney anyway, and it's very difficult to get a Public Defender before being indicted."

http://www.uwwwb.com/forum/showpost.php?p=11&postcount=2
http://www.uwwwb.com/forum/showthread.php?t=3

versus: "gee, maybe you don't have all the facts, maybe you haven't spent 6 to 8 hours a day with attorneys like we have"

http://www.webhostingtalk.com/showpost.php?p=6121508&postcount=214

Those posts were made within 24 hours of each other. So from no money or access to a PD to 6-8 hour meetings with lawyers, all licketysplit. This is why we have the right to remain silent.

I'm pretty much a full-fledged internet detective. I'm gonna go get a badge from a gumball machine. One for Limited too, he/she is much better at this.

@Limit3d1

I guess you are talking to the wrong people. Every day at WHT forums are posted new threads where customers complain against service providers and some "arrogant" provider reply based in ToS, contract terms. If you think you are showing us a horror story, I guess we are used to better ones.

Many do not see this past. Many only look at the main story and a few quick sound/text bytes he made and say he was wronged. But when you look deeper, you see a man who enjoyed his status, his power over others after he took them, and continued it over and over living high off the fat, enjoying every minute of it while everyone else suffered. That is the problem in having any respect for such people.

Are you talking about Mr. Bush or Mr. Obama?


It is an interesting story.. As for Agent Lynd, well, he is AirCav, and they love the smell of Napalm in the morning...Faulkner couldn't have had a harsher nemesis than that of Agent Lynd coming for him. Everyone should know that AirCav rules...But that is another story altogether.

Something like Gestapo rules again ...

@Limit3d1

I guess you are talking to the wrong people. Every day at WHT forums are posted new threads where customers complain against service providers and some "arrogant" provider reply based in ToS, contract terms. If you think you are showing us a horror story, I guess we are used to better ones.



Are you talking about Mr. Bush or Mr. Obama?




Something like Gestapo rules again ...

You know, you REALLY have a way with going off on a complete tangent. Are you really going to drag politics into this? Trying to distract us from something?

I hadn't seen the post Faulkner made claiming he was proxyjumping - that right there shows a man who's afraid of revealing his true location - either because he's got thousands of angry victims looking for him or he knows he's about to get swooped up by the Feds. For his own sake I really hope he shuts up soon.

How many actual legit businesses are you talking about ppp? Outside of Intelimate and 'possibly" Liquid Motors, who as I understand is a company that basically spams your email box about interesting offers from various car dealerships that you may or may not have signed on with. How many actual businesses are you discussing? Because you make it sound as if most, if not all of Faulkner's operations were above board and legit, which so far we have seen the opposite being true.
I am not saying that he was not engaged in some sort of fraud, and judging by the documents I have reviewed; his alleged allegations may very well be true. WHAT I am STATING, and many other business owners that run Colo's and have clients, is that he was only a transit provider to individual companies machines. His actions or alleged fraud, based on the evidenced contained from AT&T/Verizon show that there is an unsettled balance due. Neither company is saying that the companies that are not associated with Core IP/Faulkner are responsible for unpaid bills. So, the fruits of Mr. Faulkner/Simpson's alleged fraud should NOT encompass those independent companies that were renting space.
As for the affected companies, there is Zattco, Itelimate, Liquid Motors, Inverse Operations & all of their clients which includes (Culture Red, Gut Check, among others)….

It isn't a stretch at all to "assume" that he may have kept data on servers in his facility to hide his ongoing enterprises. It was also stated in the affidavit that Faulkner kept a drive with him with all critical data on it, as well as keeping this data very confidential. Assuming that he thought about a backup to that if that drive was ever confiscated, he may also place this data on servers in his facility as a further redundant backup. The catch would be if that data or server were ever compromised, he could then claim that it wasn't his server, therefore that data didn't belong to him. Drug dealers (not saying he was/is one) do this often by placing drugs in a car or other innocent place to disguise ownership of the drugs if ever found. I don't really think the FBI had any choice. It was either or.
Again, if the building/DC has 24/7 video recording capabilities which I am sure they do. Mr. Faulkner/Simpson does not have root access to their servers, what would lead you or anyone to believe that data may reside on machines not owned by them in the DC. At the very least, since there are only two types of operating systems (unix/windows), why could the cybercrime squad collect the data on site, instead of shutting down the entire DC and pulling out hundreds of rack mounted servers?


Or do you actually think that they were going to sit on the place until everyone was contacted and showed up at the Colo? I mean what a waste of resources. It could have been days, weeks, or even months before everyone was able to be contacted to come in to the Colo; thus compromising their time, evidence, and everything else.
They did not have to sit on anything, they could have went into the DC, pulled out the machines that belonged to Faulken,Simpson, ect. And checked the other machines for signs of tampering, and asked to review the electronic video evidence.


I think it’s safe to say that those companies would not be hosting with such small time fly by night companies. Major companies that have major data such as the above probably use major companies to host or colo with or even they have their own data centers, and probably are not worried too much on this score. This was an obvious (at least it is to me) small time fly by night nickel and dime operation that changed addresses as much as they changed their shorts. Most major companies will not elect to host with such companies in my opinion. And they do major Due Diligence prior to moving important or otherwise mission critical data to a hosting company in my opinion. I am sure there are many onsite inspections, insurance companies to be contacted, DUN reports requested and so forth on any companies they decided to host such mission critical data as you outline.

Telx is one of the nation’s premier datacenters in the country. So, in many cases very reputable companies may choose to host their equipment with Core Ip/ Faulkner. I would suggest you visit telx.com and see for yourself.



It's a tough choice for the agents, and even tougher for the people who lost servers. But is that the agents problem or even his responsibility or is it the defendants?
Perhaps you can contact the agent and his department and ask him for yourself. Because, based on the filing it certainly seems at least according to Liquid Motors who "believes their companies fourth ammendment was violated",and sued both the Agent and United States.


If you look at it from his end. He is dealing with or taking on guys who are probably "NOT" easy to deal with. They may have connections to other potentially radical support groups that make threats, pass them on to others, and or make life hard for those who come after them. Some of these criminals today do not care one whit about an agent or his life or lifestyle. It takes only one nut case to make a mountain of trouble (see Oklahoma, Waco, Ruby Ridge etc). This guy has had an army come out of the woodwork on other blogs and or news places to defend him where he has posted. All with the same type of militant posts. Calling Lynd a fascist, the raid akin to Obama taking our guns away, and all manner of other issues and derogatory statements.
Clearly his agency had reason to have protection when conducting the raid on the alleged defendants homes, since as Mr. Faulkner stated, he has a Felony as he put it "I was arrested when I was 18 years old for “unregistered firearm” stemming from my modification of commercially available fireworks into an “explosive device” which we used to blow up mailboxes with. I grew up in East Texas, and there wasn’t a whole lot to do as it was, but that was a very stupid way to pass the time obviously. To be exact, we wrapped Mexican bottle rockets in duct tape. I actually got a federal case for that. “I am not sure why Mr. Faulkner seems to think blowing up mailboxes 20 or so years later is acceptable. Or at least admit that in hindsight he probably should not have destructed his own neighbor’s mailboxes, but perhaps they should have treated it as a misdemeanor. But alas I am not him, and that is his personal opinion of the judicial system.


I don't know. It seems that Liquid Motors says or acts like they are some 200 million dollar a year business. Maybe they are, but if they were, why didn't they have backups that could kick in when one site was down?

It doesn't matter if they are a fortune 500 of 50 company, they still have customers, employees, vendors, ect to work with and pay. And judging by your chosen name 'what is a colo', you undoubtedly have limited knowledge of colo operations. And the fact that a bandwidth provider, provides ethernet handoff's to customer owned equipment (unless they are a managed hosting provider, and they may have remote or admin access). I would highly suggest that you contact a colo in your area, and schedule a visit (many I am sure would be more than happy to give you a tour). In this case and the other companies have come forward, they all contend that the respective owners purchased bandwidth from their upstream providers Core IP, ect. I would tend to believe owners of many respective companies, especially when they have testified to that fact in court documents and open court.


As for managing inventory, I didn't see anything listed that says they manage the inventory of auto dealers nationwide. I think they have a contract to send spam out to people’s inbox who sign up for information from online dealerships. Then they spam you with sales advertisements and deals aplenty. But managing inventory? Hrmm. I don't know about that. I don't really know much about them at all. Except to say, why no backups if their data was mission critical? They should have had servers mirrored in other locations, that way they would not be losing "millions" right?
It sounds to me that you have a bone to pick with Liquid. If you bothered to take 2 minutes and view their website. You will notice that a) they produce vehicle videos b) design custom websites for auto dealers (with backend inventory management) c) provide listing services on eBay and a variety of online advertising sites. So a business that was not engaged in fraud, even if they did have some data mirrored (which I am sure they did), was crippled and put out of business for a short period of time. Again, if you read the testimony and court docket, you will see quite plainly that there is a 99% chance of no illegal data residing on their servers.



I mean the request for relief looked about as lame as it could be in my opinion. I didn't see account statements showing millions of dollars being lost by Liquid Motors. Or here is our business losses to date, and or contracts lost. Or here is our customers screaming and walking away from us, which would have shown the reality of the losses in the case. Instead there was just the above, summarized in my recollections of course, which seemed to be a small time relief request which cost maybe 1500.00 to obtain. Again YMMV on my opinions.
Lets see they have approximately 700 or so clients, partnerships with Kelly Blue Book, eBay, AutoNation, ect. I am sure there are contracts in place, which stipulate recourse if they fail to provide service(s) to those customers, and if their clients suffer downtime. Additionally, in the two part amended complaint I have took the time of uploading, it clearly spells out the equipment the company is without. So regardless of whether they can purchase newer, faster, better equipment today, it is still going to be a loss for the company. In the companies discussion with wired magazine the Executive VP said”‘ We had to replace everything,' he said, noting that they won't know how much the raid cost them financially for a while. He said the company has more than 750 customers who were affected by the raid, and that they're working on restoring service to those customers."

@Limit3d1

I guess you are talking to the wrong people. Every day at WHT forums are posted new threads where customers complain against service providers and some "arrogant" provider reply based in ToS, contract terms. If you think you are showing us a horror story, I guess we are used to better ones.



Are you talking about Mr. Bush or Mr. Obama?




Something like Gestapo rules again ...

Dude, you need to start paying attention to this thread. Michael Faulkner is a documented pathological liar. He's a beligerent, arrogant, narcissistic conman. People may complain about service all the time but how many people around here respond with 'i'm gonna go buy chips and beer with your money'?

Why you or anyone else would bother giving him the benefit of the doubt is incomprehensible given the affidavit and what has been discussed here. And give up the blaming the FBI thing. All it does is make you look like one of the crazies he's trying to flag. I hate LE just as much as the next guy but they aren't the problem here.

Reason, logic, critical thinking. They come in handy from time to time.

You know, you REALLY have a way with going off on a complete tangent. Are you really going to drag politics into this? Trying to distract us from something?

There is no politics here. I just used an extreme example: If you are head of a country or head of a small shop, right wind or left wind, the same text could be used.

... either because he's got thousands of angry victims looking for him ...

Could you elaborate please?

Could you elaborate please?

Gladly. The only reason he would be hiding behind all those proxies he claims to have is if he knows somebody will be chasing him down.

Why would anybody chase him down if he hasn't done anything wrong? And what's more, why would he be running if he knows he hasn't done anything wrong? Why is he running away from them instead of staying and fighting what should be the good fight?

The truth has come out. He's hiding. He's far away from Texas. He's obviously headed somewhere where nobody will expect him to be. Why does an innocent man run?

And for the love of God, stop comparing an FBI raid on a fraud operation to the German military police force responsible for the summary execution of nearly 6 million Jews. YOU may not be affected, but some of us have reasons to take it personally.

P.S. Have you personally read the entire search warrant, front to back?

Dude, you need to start paying attention to this thread. Michael Faulkner is a documented pathological liar. He's a beligerent, arrogant, narcissistic conman. People may complain about service all the time but how many people around here respond with 'i'm gonna go buy chips and beer with your money'?

Surely you know nothing about colo and the hosting industry. Please do a favor yourself and read some threads here in WHT. You will find people fighting for $5, incredible arrogant replies, everything you never could imagine but this is the real world.

Why you or anyone else would bother giving him the benefit of the doubt is incomprehensible given the affidavit and what has been discussed here. And give up the blaming the FBI thing. All it does is make you look like one of the crazies he's trying to flag. I hate LE just as much as the next guy but they aren't the problem here.

There is nothing but allegations by now. There is no charges, no arrests, no convictions. I will never call anyone a criminal in this stage. And, differently from you I like law enforcement as my father was a LE officer and I know how hard it is.

Reason, logic, critical thinking. They come in handy from time to time.

I recommend you reason, logic, critical thinking.

Surely you know nothing about colo and the hosting industry. Please do a favor yourself and read some threads here in WHT. You will find people fighting for $5, incredible arrogant replies, everything you never could imagine but this is the real world.

This isn't IT-specific. It's basic customer service. If you or anyone else treats their customers like Slick Faulkner does, don't expect to be in business long.



There is nothing but allegations by now. There is no charges, no arrests, no convictions. I will never call anyone a criminal in this stage. And, differently from you I like law enforcement as my father was a LE officer and I know how hard it is.

As Limited--who obviously has some legal expertise--pointed out, an arrest and indictment is all but guaranteed once the investigation has reached this point. It hasn't happened yet, but I assure you it will. It's why Mr. Off-Shore Proxy is on the run. And the "allegations" are based on actual "evidence" which at some point will be presented in "court".



I recommend you reason, logic, critical thinking.

Thanks for the advice.