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CEO pleads guilty of conspiring to provide encrypted Blackberry cell phones to Mexican drug cartels

October 7, 2018  |  Posted by: Francesca Falzarano
CEO pleads guilty of conspiring to provide encrypted Blackberry cell phones to Mexican drug cartels

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Vincent Ramos, founder, and CEO of Phantom Secure, a company that provided Blackberry cell phones, after removing their cameras, microphones, and GPS systems and then implemented encryption software to create a protected phone to Mexican drug cartels, has entered a guilty plea to charges of conspiracy.

In March, Ramos was taken into custody after an FBI probe in which U.S., Canadian, and Australian undercover authorities pretended to be drug traffickers and made it apparent that they wanted the phones to conduct illegal activity.

The criminal complaint indicated that Vincent Ramos not only claimed it was “fine” to send a text that said “sending MDMA to Montreal” but was busted telling government agents in Las Vegas that the company produced the phone “specifically for this” – referring to drug-related activities.

The feds also convinced a convicted drug smuggler that worked for the Sinaloa Cartel and who was a client of Phantom Secure to testify against Ramos.

All of this resulted in the guilty plea this week, in which Ramos confessed to operated a criminal network that helped import drugs – including cocaine, heroin, and meth – into the U.S., Australia, Mexico, Canada, Thailand, and Europe, according to the Vancouver Sun.

As a result, Ramos faces two decades behind bars.

Along with stripping down the Blackberry phones and installing PGP software to support encrypted communications, Phantom Secure managed servers in Panama and Hong Kong as a means to stay out the reach of the Western government, and used proxies to conceal the physical location of the servers.

The business also installed and used remote-wipe methods on their phones so they could be cleaned of any incriminating evidence if seized by authorities. He was usually compensated in Bitcoin.

Phantom Secure is not the only business working in what has quickly become a legal gray area, giving secure phones to what often end up being criminal enterprises. Another, Ennetcom, was terminated in Holland in 2016. Other include Myntex, SkySecure, and Ciphr.

However, while those businesses either check their clients’ credentials or don’t ask many questions, Ramos was actively engaging with criminal enterprises.

Some companies marketing secure phone services charge between $1,000 and $2,000 monthly per device. It’s not clear how much Phantom Secure made but the fact that Ramos agreed to pay $80 million – along with tens of millions of dollars in assets, including a Lamborghini, several residences, and gold coins as part of his plea – shows that he was doing brisk sales.

He attempted to implement a level of security by ordering a personal reference from an existing client before selling one of his phones but clearly didn’t count on detectives being able to sway existing criminals.

In addition to his assets, Ramos also handed over server licenses and more than 150 domain names that were used to send secure messages.

“Today’s plea of Phantom Secure’s CEO, Vincent Ramos, is a significant strike against organized crime,” FBI Special Agent John Brown said in a statement.

“The FBI and our international law enforcement partners have demonstrated that we will not be deterred by those who exploit encryption to benefit criminal organizations and assist in evading law enforcement. With this case, we have successfully shut down the communication of criminals who operated across the globe.”

Ramos’ sentencing has been scheduled for December 1th7 in San Diego. His co-defendants Kim Augustus Rodd, Younes Nasri, Michael Gamboa, and Christopher Poquiz, are on the lam.

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