BULGARIAN POLICE RAID MAJOR INTERNET PIRATES

UNCLAS SOFIA 000369

SIPDIS

STATE FOR USTR LMOLNAR, JCHOE-GROVES
STATE FOR EB/IPE JURBAN, SWILSON, JBOGER AND EUR/NCE MNORDBERG
COMMERCE FOR SSAVICH

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECON KIPR BU
SUBJECT: BULGARIAN POLICE RAID MAJOR INTERNET PIRATES


1. (U) SUMMARY: The owners of two of the largest torrent trackers,
arenabg.com and zamunda.net, were arrested recently by police during
raids on illegal Internet piracy facilities. Both were released by
the courts after two days detention pending further investigation.
Whether and when they go to trial depends on the results of the
investigation. The owners have voluntarily shut down the sites for
the time being. The raids are part of the GOB's increased law
enforcement efforts against Internet crimes. END SUMMARY


2. (U) Sixteen computer systems and a number of hard disks were
seized in 14 inspections of torrent trackers last week. The
inspections were conducted against two of the four biggest Bulgarian
torrent trackers (free file sharing method among Internet users)
arenabg.com and zamunda.net and a number of large Internet users. A
few days before the raids, two other big torrent trackers, data.bg
and bol.bg, decided to voluntarily shut down their torrent sites.
The GOB said it will continue inspections for unlicensed content on
the local network area (LAN) providers.


3. (U) Elian Geshev, owner of Arenabg.com, was arrested by the
police March 16, for suspected infringement of the domestic
copyright law and distributing material with adult content.
Geshev's arrest followed a joint effort by major law enforcement
agencies - the Ministry of Interior's (MoI) Directorate General for
Combating Organized Crime, the Sofia Investigative Service and the
Supreme Cassation Prosecution. Geshev, who was the subject of
another GOB action last May, was released by the Sofia Regional
Court on March 18, although investigative proceedings against him
are still underway. Geshev is reported to have owned a large share
of a company related to the SIC group, a major organized crime
group, a few years ago. The press reported Geshev and the other
owners could be imprisoned for up to five years and fined up to
$2,000. Our industry contacts told us, however, that there is not
enough legal precedent in this area to accurately predict at this
time what the final charges would be, let alone the final
penalties.


4. (U) According to government estimates, some 30,000 users download
music, films and software from the Arena.bg site every day. The
press estimated the daily loss at up to $600,000, but industry
representatives told us they couldn't confirm that number. The
Bulgarian owners of arenabg.com, which is currently registered in
the United States, say that the site already has a new foreign
owner. Zamunda.net, in turn, encourages downloading by making the
biggest downloaders VIP clients of its site.


4. (SBU) COMMENT: We have heard for a few months that the
government planned to step up efforts against Internet piracy -
especially the torrent sites. The good interagency cooperation
evident in this action is promising, but must be followed up by
strong investigations, prosecutions and legal proceedings. Another
general concern is in getting the media to understand the piracy
angle from the rightsholders' position. The press tends to support
the pirates, casting this as a "freedom" issue, and downplaying the
GOB's efforts, which it derides as nothing more than campaigning
ahead of the 301 decision. That is an exaggeration, as the
government fully understands we want to see sustained performance.
BEYRLE