United States authorities revealed March 12 they issued warrants to arrest two Vancouver men on charges they enabled the import, export and distribution of heroin, cocaine and methamphetamine in Australia, Asia, Europe and North America.
But, as of the evening of March 14, one of the men claimed he only knew what had been reported in the media.
Sky Global Inc. CEO Jean-François Eap claimed in a prepared statement that he is being vilified and that his company, which sells encrypted smartphones and network subscriptions, works “for the good of all.”
“I do not condone illegal activity in any way, shape or form, and nor does our company,” said Eap in a statement. “We stand for protection of privacy and freedom of speech in an era when these rights are under increasing attack. We do not condone illegal or unethical behaviour by our partners or customers. To brand anyone who values privacy and freedom of speech as a criminal is an outrage. In the coming days, my efforts will be focused on clearing my name of these allegations.”
Eap and alleged Sky Global distributor Thomas Herdman were charged in San Diego with racketeering conspiracy and conspiracy to distribute controlled substances. U.S. authorities say warrants have been issued for their arrest, alleging Sky Global products and services have been used in transnational organized crime by drug traffickers and money launderers.
If convicted, Eap and Herdman could face a maximum penalty of life in prison. On the morning of March 15, the SkyGlobal.com website was seized by the Federal Bureau of Investigation.
“There are at least 70,000 Sky Global devices in use worldwide, including the United States,” said the indictment. “For more than a decade, Sky Global has generated hundreds of millions of dollars in profit by facilitating the criminal activity of transnational criminal organizations and protecting these organizations from law enforcement,” said the indictment.
“To stay outside the reach of law enforcement of the United States, Sky Global maintained its servers in Canada and France, and used proxy servers to further disguise the physical locations of its servers.”
Additionally, the U.S. alleges Sky Global front office staff have physical control of the enterprise’s network and can initiate new subscriptions, remove accounts, remotely delete (aka wipe) and reset devices.
The indictment said administrators, distributors, agents and clients remained anonymous to each other and did not request, track or record their clients’ real names and interacted only via username, email handles or nicknames. The indictment claims Eap used the alias 888888. The U.S. also claims Sky Global used digital currencies, including Bitcoin to facilitate transactions and created shell companies to hide proceeds from the sale of encryption services and devices.
Distributors and agents charged subscription fees of USD$1,000 to $2,000 per six months. The company allegedly operated under an “ask nothing/do nothing” approach to clients since shortly after the 2018 takedown of Phantom Secure, a Richmond company that sold encrypted mobile phones to organized criminals. Former RCMP national intelligence director Cameron Ortis was charged in 2019 with leaking sensitive information to Phantom Secure.
The indictment says this allowed Sky Global to have “plausible deniability from the activities of their clients that they knew or had reason to know participated in illegal activities, including international drug trafficking.”
The website for related company Sky ECC website advertises self-destructing messages, full-featured group chat, flash messages that disappear 30 seconds after reading and group broadcast messages. Users can also share images and notes and secure audio messages. Images, chats and notes could be protected in a “vault” and, in stealth mode, Sky ECC “becomes a fully functional calculator.”
In an August 2020 blog post, the company marketed its services to media companies.
“Sky ECC can help journalists protect their sources and their work, especially when working on high-profile public interest stories. In addition to protecting sources, Sky ECC lets journalists stay in touch with editors and can be used to securely send notes, images, and audio back to the newsroom.”
On March 8, Sky Global denied reports that Belgian and/or Dutch authorities cracked or hacked its encrypted software.
“With the global rise of corporate espionage, cybercrime and malicious data breaches, privacy and protection of information is the foundation of the effective functioning for many industries including legal, public health, vaccine supply chains, manufacturers, celebrities and many more.” Eap said in a statement on March 8.
Eap is also a principal in mobile phone retail and wholesale, through Richmond-based Rogers-authorized reseller Inspire Wireless and Fido-authorized reseller Pepper Wireless. Neither of those companies is named in the U.S. indictment.
“We are aware of the allegations and are in the process of gathering information,” Zac Carreiro, a media relations and public affairs specialist at Rogers, told theBreaker.news.
Eap’s $5.575 million-assessed mansion in West Vancouver was under renovation when theBreaker.news visited March 15. Workers and neighbours said they have rarely seen Eap.
Co-accused Herdman bills himself as a Japanese-fluent consultant and advisor on new technology and energy projects.
For a 2018 Vancouver panel discussion on the tax implications for cryptocurrency, Herdman was identified as “the international distributor for Sky Global Communications’ military-grade encrypted messaging.” At the time, he was adding a “secure crypto vault and payment remittance system” to Sky messaging.
Eap launched a new hand-roll sushi restaurant on Robson Street called Hello Nori earlier this year. Sky Global’s other product is a digital wallet app for gift cards called Moola.
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