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01|09|2010 03:27 pm EDT

False Registration of Domains Leads to Severe Criminal Punishment in the U.S.

by Adam Strong in Categories: Legal Issues

A story in Dallas that made headlines regarding a massive cyber-criminal ring that defrauded telecommunications companies of millions of dollars, has also shed some light on a little cited provision in US law that involves domain names.

According to the Dallas Morning News , a group of 19 defendants were each charged with one count of conspiracy to commit wire and mail fraud.

According to court documents [PDF], the group used shell corporations, false identities, false representation and of course domain names to aid them in defrauding insurance companies, creditors, leasing companies, power companies and telecommunication companies  for over $15 million in goods and services.

The false registration of domain names cited in Count 7 and 8 of the charges (page 51-2) states that defendant Matthew Norman Simpson and Michael Blaine Faulkner knowingly registered the domain names and with false contact information and used this domain name in the course of committing a felony.

These counts can add a much more severe penalty to the overall charges that Simpson and Faulkner now face.

“False registration of a domain name” — according to

f)(1) If a defendant being prosecuted for a felony offense (other than offense of which an element is the false registration of a domain name) knowingly falsely registers a domain name and knowingly uses that domain name in the course of that offense, the maximum imprisonment otherwise provided by law for that offense shall be doubled or increased by 7 years, whichever is less.
(2) As used in this section–
(A) the term `falsely registers’ means registers in a manner that prevents the effective identification of or contact with the person who registers

The 2004 revision to this bill was clearly designed to deter criminal activities using the internet. In the guidelines to the US Sentencing Commission the amendment clearly states

“to ensure that the applicable guideline range for a defendant convicted of any felony offense carried out online that may be facilitated through the use of a domain name registered with materially false contact information is sufficiently stringent to deter commission of such acts.”

This is concept for deterring the use of domains as a smoke screen for criminal activity but it’s highly likely most criminals don’t know about this law (or care).¬† If you are going to hide your criminal activity behind domains, it’s going to cost you.

Kudos to George Kirikos and

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