KIRSTY JOHNSTON
Calls are growing for an inquiry into how a German millionaire convicted of insider-trading and now accused of internet piracy was able to settle in New Zealand, as he prepares a bid for freedom.
File-sharing king Kim Dotcom, 37, was taken by armed police from his Auckland mansion on Friday alongside three others accused in the "Mega Conspiracy" case, an FBI-led operation into copyright conspiracy.
The men, including another New Zealand resident, Bram van der Kolk, 29, of the Netherlands, will reappear in North Shore District Court today to apply for bail.
Although the accused do not face charges in New Zealand, the country is helping the FBI and the United States Government with the arrests and extradition.
The men's hearing comes as opposition politicians call for accountability into Dotcom's status as a resident. Although the overweight, flamboyant former hacker – who legally changed his name to Dotcom from Shmitz – had convictions from his native Germany, he was able to settle in Auckland after investing $10 million in New Zealand government bonds in 2010.
Those bonds are now part of the assets frozen by authorities investigating the charges against Megaupload – which include racketeering, money laundering and copyright infringements.
NZ First leader Winston Peters called for the prime minister to set up an immediate inquiry into how Dotcom was allowed to stay permanently in Auckland, where he lived in a $30 million mansion belonging to the Chrisco enterprise founders.
"It has been reported that Dotcom is known in Germany as a notorious computer hacker and has been convicted of insider trading, yet immigration authorities let him settle here under the so-called investor-plus category. The prime minister should order an immediate inquiry ... to see who was involved in this immigration scandal and ensure that it doesn't happen again."
Labour immigration spokeswoman Darien Fenton said that before there was an inquiry, it should be asked whose responsibility it was to allow the discretion to overlook his convictions.
The "investor-plus" category Dotcom's residency fell into needed to be looked at to ensure others of "dubious" character were not also able to bypass the good character test, she said.
In a statement, the Immigration Service said that "Mr Dotcom made full disclosure of his previous convictions and they were taken into account in the granting of his residence. The Immigration Act allows for discretion to be exercised in certain cases. In this particular case, Immigration NZ weighed the character issue and any associated risk to New Zealand against potential benefits to New Zealand".
Dotcom is the founder of the Megaupload site and its spin-offs.
The site began as a "cyberlocker" – essentially a storage facility for files.
However, it grew into a repository for copyright films, TV shows and books, where users could watch content without charge. It also ran a "premium" service for additional benefits and made money from advertising.
US authorities claim that Megaupload and its sister sites made more than US$175m in criminal proceeds and cost copyright owners more than US$500m.
Megaupload and another company, Vestor, were indicted by a grand jury in Virginia and charged with racketeering conspiracy, various copyright infringement counts and conspiring to commit money laundering.
Others charged with Dotcom were: Finn Batato, 38, of Germany; Julius Bencko, 35, of Slovakia; Sven Echternach, 39, of Germany; Mathias Ortmann, 40, of Germany; Andrus Nomm, 32, of Estonia; and Bram van der Kolk, 29.
Dotcom, Batato, Ortmann and van der Kolk were arrested in Auckland by New Zealand police on behalf of the US. The other three remain at large.
- © Fairfax NZ News
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