Members of drug cartels in Mexico and global crime syndicates were among the buyers of what were billed as “uncrackable” encrypted BlackBerry phones from a Canadian security company, whose subscription service routed communications via servers in Hong Kong to make sure law enforcers could never tap calls or intercept messages.
A US court heard that the Sinaloa drug cartel in Mexico had been using the Phantom Secure company for years, which was run by Vancouver-based businessman Vincent Ramos.
Ramos used servers and private networks in Hong Kong and Panama to keep US law enforcement from snooping on his clients. His other buyers were members of the Hells Angels bikie gang in Australia who used his phones to coordinate several killings, authorities said.
Ramos was sentenced to a nine-year term by a federal court in San Diego on Tuesday for selling about 7,000 of the phones to criminal figures or groups worldwide, which helped them traffic narcotics and plan murders while avoiding the prying eyes of law enforcers. Everything to and from the handsets was encrypted.
Ramos bragged about the “inhackability” of his phones, citing a 2014 high-profile murder case in which investigators failed to break into the phone used by the suspect.
It is the first US conviction involving an offender providing encryption technology to criminal organizations, but four of his accomplices remain at large. Prosecutors also alleged Ramos offered to wipe phones remotely if they were seized.
He pleaded guilty last fall to one count of racketeering conspiracy and was also told to forfeit US$80 million in earnings including homes, international bank accounts, cryptocurrency and even gold coins, the Associated Press reported.
Assistant US Attorney Andrew Young said the scope of this case was staggering, calling Ramos’ clients “some of the most sophisticated criminals in the world using some of the most sophisticated technology in the world.”
Ramos was arrested last year in Washington state and his secure communications network has since been dismantled.
Similar encrypted devices – either Android or BlackBerry phones – had their microphone and GPS functionality removed, and instead rely only on end-to-end encrypted chat apps for communication, making it difficult for authorities to intercept and investigate as these phones are nearly impervious to decryption, wiretapping or legal third-party records requests.
In addition to removing the microphone and camera from BlackBerry devices, Ramos also disabled the GPS navigation, internet browsing and normal messenger services, and then installed Pretty Good Privacy (PGP) software to send encrypted messages. He then routed them through private networks hidden behind virtual proxy servers in Hong Kong and Panama, jurisdictions “seen as generally uncooperative with overseas law enforcement,” according to another report by tech website vice.com.
It is not clear if the Hong Kong Police Force was involved in the investigation or if servers used by Ramos have been shut down. Hong Kong has long commanded a seedy reputation of being an offshore base for dubious internet and communication services for users in the West and Southeast Asia.
The city is also a base for numerous virtual private network service providers for internet users in China looking to circumvent the nation’s strict censorship.