Business

‘Mega’ bust nearly went boom

Kim Dotcom, the German-born founder of content-sharing site Megaupload.com, was found holed up with a shotgun as New Zealand authorities moved in to arrest him.

“When we first entered the property, Mr. Dotcom was not overly cooperative and in fact fled to what can best be described as a safe house, or a safe room,” said Detective Inspector Grant Wormald from New Zealand’s Organized & Financial Crime Agency.

“It took some time to get through the security measures that were in place and he was subsequently found in that safe room with a loaded shotgun resembling a sawn off shotgun.”

About 70 police, some armed, raided 10 properties and also arrested the Web site’s chief marketing officer, Finn Batato, 38, chief technical officer and co-founder Mathias Ortmann, 40, both also from Germany, and Dutch national Bram van der Kolk, 29.

New Zealand police seized millions of dollars worth of assets, which included luxury cars such as a Rolls Royce Phantom Drophead Coupe, from the group, dubbed the “Mega Conspiracy” by prosecutors. They also seized more than NZ$10 million ($8 million) from financial institutions.

Dotcom, 37, also known as Kim Schmitz and Kim Tim Jim Vestor, and the group are accused of engaging in a scheme that took more than $500 million away from copyright holders and generated more than $175 million in proceeds from subscriptions and advertising, according to the indictment.

The Department of Justice announced the indictment and arrests as debate over online piracy reaches fever pitch in Washington, where lawmakers are trying to craft tougher legislation.

Hackers quickly showed their opposition to the shutdown, attacking the public Web sites of the Justice Department, Universal Music, and the two big trade groups that represent the music and film industries.