Litigation to determine Internet infrastructure crime boundaries?

Amir Golestan, founder and CEO of cloud platform provider Micfo, has admitted to using the company to obtain rare IP addresses through fraudulent means.

He was sued for fraudulently obtaining thousands of IP addresses from the American Registry for Internet Numbers, a nonprofit organization that allocates IP addresses for computers to communicate with the Internet. On November 16, 2021, a federal court in Charleston, South Carolina pleaded guilty.

According to prosecutors, the Golestan lawsuit is the first federal lawsuit against fraud involving Internet resources, including IP addresses. Legal and technical experts have taken note of the lawsuit, saying it will be a lawsuit that sets new boundaries for criminal activity in the world of loosely regulated Internet infrastructure.

Micfor has been reported to have been used by criminals and hackers to support VPN services that allow users to hide their online activities. However, there is no evidence that Golestan was aware of criminal activity, such as hacking by Micfor users, so simply hosting the Internet infrastructure used by the criminals does not convict Micfor or Golestan.

But things took a turn when Golestan admitted in a 2020 press interview that he was getting an IP address inappropriately. The number of IP addresses is limited and can be traded on the market. According to prosecutors, Golestan used fake companies and fictitious people to get more IP addresses than stipulated from the registry.

He said in an interview that he was cheating by using virtual characters to prevent victims from appearing in order to provide services to avoid violating the law. However, prosecutors argued that Golestan’s actions were illegal and that the market value of the illegally obtained IP addresses was equivalent to $14 million.

If Golestan later pleads guilty, he could face up to 20 years in prison. However, it is pointed out that if the first case like this is dealt with, the amount of crime imposed may be much lower. In addition, MicPo is known to use illegally obtained IP addresses to track Internet traffic that normally should not be traced, which is considered illegal. However, federal investigators do not claim that Golestan and Mike Poe were aware of this fact. Related information can be found here.