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Data Center Raid About Unpaid Telco Fees
craig writes "CBS11 News reports that the raid on Core IP networks is in the result of an investigation into unpaid telco access fees paid by CLECs and VoIP carriers to terminate calls on their networks. They also report that this raid is linked to the March 12th raid on Crydon Technology's datacenter, which also hosted VOIP providers. Anyone in the telco business will tell you access fees to other carriers are a total mess and lots of carriers have unpaid balances out there. It gives you the feeling that the FBI is acting as a collection agency for AT&T and Verizon."
During the raid, CMG's owner, Joe Condit, says his website and business went down. "It's crippled us completely. Now that we don't have a website, we have no business, and a lot of speakers are without representation."
Without saying that this raid should have occurred in the way that it did, what's stopping this guy from setting up a webserver elsewhere and getting his business back online?
In an emergency, I'm pretty sure I could have a basic but "adequate" webserver for most small businesses up and running on just about any Internet connection within about 6 hours, even if I had to buy a new computer to install it on and find another Internet connection. Point the DNS records to the new address and he's back in business.
He would be in exactly the same situation if the colo building burned down. Why risk your business that way? If it's important to you, back it up and have some idea of what you're going to do if it goes down.
If you're a zombie and you know it, bite your friend!
In the US, if I'm not mistaken, criminal charges (like fraud) are generally (or even exclusively) brought by a public prosecutor (state's attorney, DA, etc), not a private party. If it's an interstate crime, I think the jurisdiction for the investigation falls to the FBI. So FBI involvement alone doesn't really seem anomalous (although seizing the whole data center does). IANAL so feel free to correct me.
Mod points: Guaranteed to remove your sense of humor.
Side effects may include gullibility and temporary retardation
index
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
direct link: http://sites.google.com/site/mnsclec/index //Just made an account to post this.
If its really about money owed to the telcos by these VoIP providers, the right way for Verizon, AT&T etc to get their money back is to cut off whatever VoIP->PSTN gateway setup is being used. If its a 3rd party gateway, the third party gateway should be responsible for paying the telco and then the VoIP provider should be paying the 3rd party gateway.
In any case, its possible to shut down whatever links are used to connect to the telcos networks
Late payments are one of the signs that a company is about to go under.
Not if lawyers are involved?
I'm seeing more and more of this in non-related businesses, but what it boils down to is this:
Customer finds a discrepancy and needs to get it worked out, so they call an audit and find a MAJOR snafu. To protect themselves, they bring in the lawyers.
All payments stop until the issue is resolved. Usually, the money is placed into an escrow during the legal proceedings, especially if the customer has the money to pay the bill.
Provider's lawyers work with the customer, but this takes time. Take too long, and the statute of limitations will run out.
More time passes. Customer has the money and can pay, but lawyers say no.
Provider sends a final notice: pay up.
Customer sends a letter: Our lawyers aren't done, and we can't send the money yet. Look! The money is right here in this account, just WAIT A FEW MORE DAYS!
Provider turns to their lawyer: If you wait one more day, the statute of limitations will expire and they could walk away scott free.
Now the provider has no choice? They MUST take action to protect their interests, so they seize the assets of the customer in some fashion. Most of the time this involves filing a lien on those assets, but in some cases-like this one-they can physically collect those assets.
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This sounds eerily similar to my own experience with the FBI. Our tiny basement apt was raided a few years ago by about a dozen armed agents for a relatively minor copyright case involving my husband's website. They seized every computer they could find, handcuffed us, pointed guns at us, and started asking us questions that made it clear they thought the money involved was literally 10,000x more than it actually was.
A few days later, we got a lawyer who got a copy of the affidavit upon which the warrant was based, and it was full of many gross errors - factual errors such as background checks run on the wrong social security number, references to cease and desist notices that were never received because they were sent to an email address at nonexistent domain, etc.
Consulting lawyers from the EFF and Stanford said that if represented properly he would probably eventually be found innocent, but only after a protracted appeals process that would disrupt our lives for years. In the end, he pled to a misdemeanor. Basically they wore us down.
When I hear things in the news about FBI raids, I would be very skeptical of the initial statements from the law enforcement side. Because apparently the FBI does not have to have an accurate accounting or understanding of the facts. Yet most people assume they do. I certainly did before this happened to us. The difference between my prior impression of the FBI's competence and integrity vs what I actually experienced over the course of the next several years - it was immense.