CEO Who Sold Encrypted Phones to the Sinaloa Cartel Sentenced to Nine Years
Photo via shutterstock.
The CEO of a company that provided encrypted phones to criminal organizations including the Sinaloa Cartel was sentenced to nine years imprisonment in a San Diego courtroom Tuesday.
Vincent Ramos, a 41-year-old Canadian man from Richmond, British Columbia, was found guilty of racketeering conspiracy and forfeited $80 million as well as international bank accounts, cryptocurrency accounts, gold coins, and real estate. Ramos, who pleaded guilty in October, was taken down by a joint operation of intelligence agencies from Australia, Canada, and the United States.
According to a press release by the U.S. Attorney’s Office of the Southern District of California, this is the first time that the United States has targeted a company and its executives for “knowingly providing transnational criminal organizations with the encrypted infrastructure to conduct the international importation and distribution of narcotics.”
In a statement, U.S. Attorney Robert Brewer stated that the network of Phantom Secure—Ramos' company—was “down permanently.”
Phantom Secure was part of a vibrant trade in custom, encrypted phones for organized crime. Often these devices in this industry—either Android or BlackBerry phones—have the microphone and GPS functionality removed, and instead rely on end-to-end encrypted chat programs, making it difficult for authorities to intercept criminals' communications.
"The idea was solely to provide a secure telecommunications system," Michael Pancer, Ramos' attorney, said in a phone call. "Then when individuals started to use this system to break the law, at some point it came to his [Ramos'] attention, and he has apologized to the court for allowing them to continue. But his intentions were certainly honorable when he started the network."
In a statement, U.S. Attorney Robert Brewer said, “Vincent Ramos is going to prison because he provided violent, drug trafficking organizations with a high tech tool that enabled them to coordinate their crimes while staying in the shadows."
Do you know Vincent Ramos, or anything else about Phantom Secure? You can contact Joseph Cox securely on Signal on +44 20 8133 5190, Wickr on josephcox, OTR chat on email@example.com, or email firstname.lastname@example.org.
Phantom Secure sold its products as completely secure and impervious to any sort of hacking or third party intrusion. These BlackBerry or Android phones were then used to facilitate and aid in criminal exploits, primarily drug trafficking. Authorities estimate that around 7,000 of the phones were being used in the criminal underworld when he was arrested. The Attorney’s Office’s press release calls the amount of drugs that Ramos and his devices helped traffic “too high [to] calculate.”
In one instance, a trafficker named Owen Hanson used six Phantom Secure phones to orchestrate the movement of a ton of cocaine out of Mexico and into Canada, the United States, and Australia. Hanson, a former USC football player who went by the name “O-Dog,” was sentenced to 21 years in 2017.
During an undercover operation against Ramos in Las Vegas, investigators recorded the Phantom Secure CEO admitting that the devices were deliberately manufactured to facilitate serious organized crime. “We made it—we made it specifically for this [drug trafficking] too,” Ramos told the undercover agents.
According to the sentencing documents, Ramos once texted one of his employees to purchase a Range Rover because he just “closed a lot of business. This week man. Sinaloa cartel, that’s what’s up.”
Some of the usernames belonging to Phantom Secure customers include: The.cartel, Leadslinger, The.killa, Elchapo66, Trigger-happy, and Knee-capper9. Phantom used servers in Hong Kong in an attempt to evade law enforcement, and had a wealth of web domains to act as messaging addresses, according to court records.
Ramos was arrested in Washington last March. According to the Associated Press, during the sentencing Ramos apologized for his actions and stated that he turned a blind eye to the criminal use of his phones.
Although this is the first time U.S. authorities have pursued an encrypted phone company, Phantom Secure is not the only firm in this industry to be targeted by authorities across the globe. Dutch police have repeatedly arrested the alleged administrators of such companies, for example, including Ennectom and PGP Safe. Both of these companies allegedly sold their devices specifically to criminals, and Ennetcom facilitated violent robberies and assassinations.
Other companies whose phones end up in the hands of serious criminals are still operating, such as Encrochat, which provides devices to UK drug gangs, according to local media reports.
Four people associated with Phantom Secure—Kim Augustus Rodd, Younes Nasri, Michael Gamboa and Christopher Poquiz—remain at large. They have all been charged with a plethora of crimes regarding racketeering and conspiracy.
Listen to CYBER, Motherboard’s new weekly podcast about hacking and cybersecurity.
This article originally appeared on VICE CA.
Correction: An earlier version of this story identified Ramos as being from Richmond Hill, when the name of the location is in fact Richmond. Motherboard regrets the error.