Additional charges for Megaupload in US case

Site founder Kim Dotcom is currently being held in New Zealand where he employs a staff of more than 50

Additional charges of fraud, copyright infringement and money laundering have been filed against Megaupload founder Kim Dotcom by US authorities.

The additional charges against Dotcom and employees of the controversial file-sharing site shut down last month were added to the original indictment unsealed by a Virginia court on January 19 said the US Department of Justice.

The superseding indictment also contains further evidence Megaupload engaged in massive piracy through facilitation of downloading of copyrighted works, the department said on Friday.

Megaupload claimed to have more than 180 million registered users, but the department’s indictment says the site had only 66.6 million registered users as of January 19.

Of that total, only 5.86 million had ever uploaded a single file to either Megaupload.com or companion site Megavideo.com.

The Department of Justice said this fact demonstrated that more than 90 per cent of the site’s users only used it to download.

“In contrast to legitimate Internet distributors of copyrighted content, Megaupload.com does not make any significant payments to the copyright owners of the many thousands of works that are willfully reproduced and distributed on he Mega Sites each and every day,” it said.

According to the Justice Department, five of the seven people charged have been arrested, including Dotcom, who is being held in New Zealand, and at least $50m in assets has been seized.

Repeat offender

The indictment went on to say Megaupload never took action against a user identified simply as “VV”, a repeat copyright infringer over a period of six years.

The user allegedly uploaded 16,950 files to Megavideo.com and Megaupload.com, which generated more than 34 million views, including copies of copyrighted movies such as Ocean’s Thirteen, Ratatouille and Evan Almighty.

Though the user had been sent takedown emails, “internal records reflect no deletions of any of VV’s uploaded files,” the Department of Justice said.

The superseding indictment also listed additional assets subject to forfeiture including property, bank accounts, jet skis, jewellery and watches.

A New Zealand resident, Dotcom, also known as Kim Schmitz, employs a staff of more than 50 in the Pacific Ocean country. Dotcom also maintains a suite at Hong Kong’s Grand Hyatt Hotel.

Megaupload is the most high-profile target to date of a US campaign which has seen a clampdown on hundreds of sites accused of offering pirated music or movies or counterfeit goods.