| |Officers seized guns, artworks, luxury cars and millions of dollars after serving search warrants on homes and businesses linked to the arrested founder of Megaupload.com today.
Cars confiscated from a sprawling mansion near Auckland included a Rolls Royce Phantom Drophead Coupe worth more than $400,000, a pink 1959 Cadillac as well as several Mercedes.
Owner Kim Dotcom, founder of the file-sharing site, and three employees were held yesterday by New Zealand police on U.S. claims they facilitated millions of illegal downloads.
Kim Dotcom, formerly known as Kim Schmitz and also known as Kim Tim Jim Vestor, was arrested along with three other executives of Megauploads. He is pictured here in 1999:
The property in Coatesville, near Auckland, New Zealand, which was raided today as part of the operation against the founder and executives of file-sharing site Megaupload.com:
A U.S. indictment alleges the 'conspiracy' has cost copyright holders at least $500million in lost revenue from films, music and other content.
With 150 million registered users, about 50 million hits daily and endorsements from music superstars, Megaupload.com was among the world's biggest file-sharing sites.
According to the indictment the site, which was shut down yesterday, earned Dotcom, its owner and former CEO, $42million in 2010 alone.
New Zealand police swooped on Dotcom's huge mansion in Coatesville, near Auckland, by helicopter earlier today, as part of a global effort to shutdown the site and seize millions in assets.
The raid on the sprawling property, built by the founders of the Chrisco hamper empire, and other sites were carried out by the Organised & Financial Crime Agency New Zealand (OFCANZ) and New Zealand Police.
Seventy-six officers were involved in the operation, working alongside four FBI officers and backed by New Zealand police's Armed Offenders squad.
A British web developer, Elliott Kember, who happened to be nearby, took a host of photos of the police raid, including the confiscation of the expensive cars.
He posted pictures of some on Twitter, remarking: 'At the Chrisco mansion. Cops, chopper, suits on phones! Megaupload!'
Mr Kember also noted some of the cars' personalised vanity numberplates, including GOD, EVIL, HACKER, KIM COM, STONED, MAFIA, CEO and, ironically, POLICE.
A neighbour of Dotcom's told the New Zealand Herald she heard a helicopter circling the property at about 6.30am.
'I thought it was his private helicopter, which is parked up behind the trees, and I thought he was going out for breakfast, as he sometimes does,' said the neighbour, whose name was not given.
'I thought "this is going on a bit long" and it was a bit annoying at that time of the morning and so I got up and realised it was a police helicopter.
'It was there for about an hour and then my friend texted me that a lot of cops had arrived.'
Police said that in total officers served 10 search warrants at businesses and homes related to Dotcom around the city of Auckland.
Police spokesman Grant Ogilvie confirmed that the seized cars included a Rolls Royce Phantom Drophead Coupe worth more than $400,000 as well as several Mercedes.
Two short-barreled shotguns and a number of valuable artworks were also confiscated, he added.
Along with the assets, Police seized more than $8million invested in New Zealand financial institutions, which has now been placed in a trust pending the outcome of the cases.
Megaupload executive Bram van der Kolk, left, Finn Batato, second from left, Mathias Ortmann and founder, former CEO and current chief innovation officer Kim Dotcom, right, appear in North Shore District Court in Auckland, New Zealand:
New Zealand's Fairfax Media reported that the four defendants stood together today in an Auckland courtroom in the first step of the extradition proceedings.
Dotcom's lawyer raised objections to a media request to take photographs and video, but Dotcom spoke from the dock, saying he didn't mind photos or video 'because we have nothing to hide.'
Dotcom, Megaupload's former CEO and current chief innovation officer, is a resident of Hong Kong and New Zealand and a dual citizen of Finland and Germany.
Two other German citizens and one Dutch citizen were also arrested and three other defendants - another German, a Slovakian and an Estonian - remain at large.
The judge ruled that the four would remain in custody until a second hearing on Monday. If found guilty of all the charges, each of the accused Megaupload executives could face up to 50 years in a U.S. prison.
News of the indictment and arrests sparked fury among an online community already bubbling with indignation over the U.S. government's proposed new anti-online piracy laws.
The Electronic Frontier Foundation, which defends free speech and digital rights online, said in a statement that the arrests set 'a terrifying precedent'.
'If the United States can seize a Dutch citizen in New Zealand over a copyright claim, what is next?' the statement added.
Hackers collective Anonymous launched a massive cyber attack against U.S. government and anti-piracy websites yesterday in response to the Megaupload shut down.
As soon as news of the arrests broke, apparent Distributed Denial of Service (DDoS) attacks overwhelmed the websites of the FBI, the Department of Justice and the U.S. Copyright Office.
Anti-piracy groups the Recording Industry Association of America (RPAA) and the Motion Picture Association of America (MPAA) were also targeted, along with several companies.
The sites were all disabled for some time yesterday.
There were reports that an Anonymous-affiliated Twitter account had boasted of the success of the attacks, but the profile had been removed by the time MailOnline checked today.
A statement posted on document sharing site Pastebin.com purportedly by Anonymous claimed responsibility fot the attacks in retaliation for the Megaupload indictment.
It said: 'We Anonymous are launching our largest attack ever on government and music industry sites. Lulz.
'The FBI didn't think they would get away with this did they? They should have expected us.'
The statement also included home addresses and phone numbers for the MPAA chief executive, Chris Dodd, and details of the organisation's corporate offices.
Megaupload hosted large files and was often used to store mp3 music and digital video files, but claims most of its users used it as a legitimate file storage service.
Megaupload was unique not only because of its massive size and the volume of downloaded content, but also because it had high-profile support from celebrities, musicians and other content producers who are most often the victims of copyright infringement and piracy.
The website boasted of endorsements from Kim Kardashian, Alicia Keys and Kanye West, among others.
The Hong Kong-based company listed rapper Swizz Beatz, a musician who married Keys in 2010, as its CEO.
He was not named in the indictment and declined to comment through a representative.
Before the site was taken down, it posted a statement saying allegations that it facilitated massive breaches of copyright laws were ‘grotesquely overblown’.
'The fact is that the vast majority of Mega's Internet traffic is legitimate, and we are here to stay.' the statement said.
'If the content industry would like to take advantage of our popularity, we are happy to enter into a dialogue. We have some good ideas. Please get in touch.'
Megaupload is considered a 'cyberlocker', in which users can upload and transfer files that are too large to send by email. Such sites can have perfectly legitimate uses.
But the MPAA, which has campaigned for a crackdown on piracy, alleged that the vast majority of content being shared on Megaupload was in violation of copyright laws.
The website allowed users to download films, TV shows, games, music and other content for free, but made money by charging subscriptions to people who wanted access to faster download speeds or extra content.
The website also sold advertising. Several sister sites were also shut down, including one dedicated to sharing pornography files.
News of the indictment came just one day after websites including Wikipedia and Craigslist shut down in protest at two congressional proposals intended to thwart online piracy.
The Stop Online Piracy Act and the Protect Intellectual Property Act - bills designed to crack down on sales of pirated U.S. products overseas - have pitted internet giants, consumer groups and freedom of speech advocates against film studios and record labels.
Even search giant Google joined the protest, albeit in a less extreme manner, with a black rectangle slapped across the logo on its home page.
But the search engine's involvement immediately drew accusations of hypocrisy, as online activists pointed out that it routinely blacklisted legitimate websites from its news aggregator and followed government orders to remove material from its search results and YouTube.
One such example was YouTube’s compliance with a request from the UK government to censor footage of a protest, during activists attempted to civilly arrest a judge.
Another example was the taking down of footage released by Wikileaks taken from an Apache helicopter showing the pilots killing two Reuters photographers in Iraq.
According to the indictment, Megaupload was estimated at one point to be the 13th most frequently visited website on the Internet.
Current estimates by companies that monitor Web traffic place it in the top 100.
The five-count indictment, which alleges copyright infringement as well as conspiracy to commit money laundering and racketeering, described a site designed specifically to reward users who uploaded pirated content for sharing.
For instance, users received cash bonuses if they uploaded content popular enough to generate m assive numbers of downloads, according to the indictment. Such content was almost always copyright protected, the indictment said.
The DoJ said it was illegal for anyone to download pirated content, but their investigation focused on the leaders of the company, not end users who may have downloaded a few movies for personal viewing.
Although Megaupload is based in Hong Kong, the size of its operation in the southern Chinese city was unclear.
The administrative contact listed in its domain registration, Bonnie Lam, did not respond immediately for a request for comment sent to a fax number and email address listed.
Regarding the retaliatory cyber-attacks, the DoJ told AP it was investigating the 'significant increase in activity' that disrupted its website yesterday.
It said in a statement that it was working to 'investigate the origins of this activity, which is being treated as a malicious act until we can fully identify the root cause.'
A spokesman for the Motion Picture Association of America said in an emailed statement that the group's site also had been hacked.
'The motion picture and television industry has always been a strong supporter of free speech,' the spokesman said. 'We strongly condemn any attempts to silence any groups or individuals.'