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Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

April 8, 2009 at 9:51 AM

Yikes: AT&T, Verizon use FBI raids to collect debt

I thought the new administration was going to tone down the jackboot attitude of federal agencies that blossomed during the perpetual war on terror.

But apparently word hasn’t yet reached public servants at the FBI office in Dallas.

According to a shocking Wired story, the feds responded to a debt collection spat between AT&T, Verizon and VoIP customers by seizing hundreds of servers from multiple co-location facilities, as well as the iPods belonging to a debtor’s kids and even the savings of a former comptroller’s grandmother.

More than 300 companies were using servers at a facility owned by alleged debtor Mike Faulkner, the story reported:

Faulkner says the two telecoms have used the FBI to seize equipment to obtain evidence through a criminal investigation instead of pursuing the companies through civil litigation and the discovery process. And instead of targeting the investigation specifically at the VoIP companies, he says the FBI swept in everyone who had servers in the same place where the VoIP servers were located. As a result, all of Crydon Technology’s equipment was seized, as was the equipment of numerous businesses that had the bad luck to own servers running out of Crydon’s facility.

“They’re destroying more and more customers and it just doesn’t seem to make sense,” Faulkner says. “They’ve done a horrible amount of damage and have been so barbaric in the way they’ve shut things down. If they just picked some random guy off the street to do this investigation, he could have done a better job than the FBI did.”

When one of the affected companies, a credit card processor, “tried to explain to an FBI agent that some of the servers that were seized belonged to him and not to Faulkner, the FBI agent implied he was lying,” the story reported:

“We were treated like we were criminals,” he said. “They assumed there was no legitimate business in there.”

Amazon.com CTO Werner Vogels seized the opportunity to suggest, on Twitter, that this is another reason to consider using cloud servers such as those rented by Amazon Web Services. Does Amazon have protection from this kind of thing? What if the RIAA takes exception to the DRM free music Amazon’s distributing from its servers and calls the feds?

Comments | More in | Topics: Amazon.com, amazon.com, AT&T

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