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The Strange Case of Kim Schmitz aka “Kim Dotcom”: Cyber Agent Provacateur for the Corporations, Underground Reich?

Kim Schmitz (aka "Kim Dotcom") demonstrating the lifestyle of the economically and politically oppressed.

COMMENT: In the aftermath of the arrest of Kim Schmitz aka “Kim Dotcom” in the wake of the MegaUpload takedown by the federal government, Herr Doctom has been variously portrayed as a martyr for internet freedom and the Second Coming of Christ by his cyber-libertarian supporters and as the Beast of the Apocalypse by his detractors. There is another possibility that suggests itself.
Perhaps Kim is actually in cahoots with some of the very same interests he would have us believe he opposes. One should attempt to “follow the money,” as was advised to Watergate investigators Bob Woodward and Carl Bernstein.
A number of things are apparent when one examines Herr Dotcommandant:
  • This guy is a 1 percenter and proud of it, given to nothing so much as conspicuous consumption.
  • There’s more to this guy than meets the eye and there is PLENTY of him that meets the eye.
  • At the time of his arrest, he had a bunch of credit cards in different names and multiple passports in various names. (Schmitz/Dotcom changes names frequently, a practice that would impede database searches for his name.)
  • QUICK: How many different credit cards and passports in how many different names do YOU have?
  • Schmitz/Dotcom is a “turned hacker”–a hacker who forsook his life of crime to cooperate with the authorities to develop computer security systems. Julian Assange appears to be another “turned hacker.’
  • As such, Dotcommandant may be viewed as an “inside player,” at least to an extent.
  • He was convicted of a number of crimes, which did not prevent relatively prestigious companies from backing some of his fraudulent undeertakings.
  • Convicted in what was the largest insider trading scandal in Germany up to that time, he fled Germany and was given 20 months probation and a 100,000 euro fine. The Dotcommandant allegedly earned $115,000 a day in his latest gig. A 100,000 euro fine is basically docking the guy a day’s pay. He got 20 months probation–no jail time. That altogether gentle wrist slap may indicate that he has good relations with the powers that be. It certainly was not a punishment that would deter the likes of the Dotcommandant. (Note that, in general, European sentencing in criminal cases is lighter than in the U.S. Still, that’s not much of a sentence for the largest insider trading scheme in Germany up to that point in time. Remember he fled the country to escape justice. The article below describes the punishment meted out to do Schmitz as “repeated lashes with a wet noodle.” Why?
  • Food for Thought:
  • With his over-the-top persona and jet set lifestyle, he’s not the best poster boy for cyber-libertariansim. Looking like a Goth Drew Carey on steroids, he presents a bizarre physical appearance to go with his “1 persenseless” behavior, making it difficult for many to feel sympathy.
  • MegaUpload appears to have taken commercial product produced by others and then taken it to market at considerable profit for themselves. In essence, that’s theft. Seen by his supporters as something of a modern Robin Hood, that construct would have more validity if Our Hero were to distribute some of his evident wealth to the grips and other little folks who worked on the films MegUpload pirates. If, for the sake of argument, one of these giant media corporations were brought down by pirated download, the Big Boys (and Girls) will float gently to earth on their golden parachutes, while the grips go into “white knuckle mode.”
  • Note that pirated download, among other things, deprives governments at various levels of sales and income tax revenues, placing added strain and their budgets. Ultimately, the more those budgets are strained, the more people get laid off from their jobs–police, firefighters, DMV clerks etc . In FTR #732, we noted that the Pirate Bay case featured a clash between two right-wing views: it’s OK to steal revenue from governments but NOT OK to steal revenue from corporations. The same appears to apply in the MegaUpload case.
  • The Dotcommandant has apparently engaged in a variety of criminal activities in the past.
  • ‘The timing of this bust, coming so soon after the justifiable debate over draconian Internet legislation that may have seriously limited the potential for this remarkable medium, sets this observer to wonder if he actually was working to generate sympathy for SOPA. Perhaps other interests were manipulating Our Hero, running him “on a leash.”
  • In the past, we’ve seen Nazi/fascist money man Carl Lundstrom financing the Pirate Bay download site. He has also allegedly been involved in financing a second free download site.
  • We’ve seen the Underground Reich engage in money-making criminal conspiracies ranging in size from the short-selling that occurred before the assassination of President Kennedy and the 9/11 attacks to the Great Train Robbery in Britain.
  • Is the Dotcommandant actually generating money for the Bormann capital network while discrediting advocates of Internet freedom? Note the money laundering charges against Our Hero, as well as the shockingly light sentence imposed on him by the German courts.
  • The other people involved with MegaUpload are Germans and people from areas that were occupied by the Nazis in WWII, such as Slovakia. (Slovakia was, like Croatia, a nominally independent Nazi puppet state, controlled by the collaborationist Hlinka party.)

Have Schmitz/Dotcom been buttressed and fueled with Nazi venture capital, in exchange for part of the profits?

The view here is that MegaUpload and Schmitz/Dotcom’s media antics will serve to discredit the cause of internet freedom and may serve as pretext for the big corporations to crack down hard–and I mean hard–on internet freedom.
That would be deeply tragic.
Now, about the Dotcommandant:

. . . . With insider trading charges pending over LetsBuyIt, Schmitz decided it was time to lay low (by his standards); “in fear for his life,” he fled to Thailand in January of 2002. On his website, he hinted at possible suicide, saying he would be crossing “to a new world,” Hale-Bopp cult style. But instead of offing himself, he declared that he wanted to be known as “King Kimble the First, Ruler of the Kimpire” — a label he would apply to his future projects. (It’s listed as his title on LinkedIn.)

As it turned out, Thailand wasn’t happy to see him. He was promptly arrested and fast-track deported to Germany to stand trial. However, the few nights in a Thai jail turned out to be the worst of it, as fears of prison in Germany were unfounded—he was sentenced to 20 months probation and slapped with a €100,000 fine. In 2003, he pleaded guilty to embezzlement charges over the Monkey “loan” and received another two years of probation.

After the law’s repeated lashes with a wet noodle, Schmitz left Germany and moved to Hong Kong to start the next level of Mega-insanity. . . .


3 comments for “The Strange Case of Kim Schmitz aka “Kim Dotcom”: Cyber Agent Provacateur for the Corporations, Underground Reich?”

  1. The internet is dying the ‘death of a thousand cuts’. It’s appropriate that the expression is Chinese, since the intensely policed internet of China seems to be the model we’re headed for.

    Posted by Dwight | February 7, 2012, 4:54 am
  2. Kim Dotcom is throwing a party, and everyone in New Zealand is invited:

    Kim Dotcom Launched His Political Party
    Written by
    Victoria Turk
    @VickiTurk victoria.turk@vice.com
    March 27, 2014 // 08:15 AM EST

    Kim Dotcom’s made the news recently in relation to both his Mega file hosting business, which this week announced it was going public, and his music career, which took off with a debut album release on his Baboom music service in January. He’s a man of many hats, but today saw a new Dotcom identity come to the fore: the politician.

    Dotcom officially launched his political party in New Zealand this morning, and it’s about more than copyright reform (though unsurprisingly, that’s high on the agenda). Privacy rights, clean tech, and perhaps most intriguingly a national digital currency also feature on the Internet Party’s newly active website.

    As you might expect from the name, the Internet Party agenda—the full manifesto hasn’t yet been released—focuses almost exclusively on digital issues. Its website describes it as “A party that will give you faster, cheaper Internet, create high-tech jobs, protect your privacy, and safeguard our independence.”

    Specific policy points mentioned include cheaper and faster internet with “an end to the bandwidth monopoly,” a jobs boost in the tech sector, a bill of digital rights to combat mass surveillance, and new copyright laws.

    The site also boasts plans for a government-sponsored New Zealand currency. How that will shape up to Bitcoin or the deluge of other sovereign cryptocurrencies like Iceland’s nationally distributed Auroracoin remains to be seen. All we know so far is from this short blurb:

    The Internet Party will support the introduction of a New Zealand-sponsored digital currency that is safe, secure and encrypted, providing for instant international transactions at minimal cost. By becoming a digital currency leader, New Zealand can become a key hub for a growing financial sector.

    There’s a hint of other broader policies, too, with mention of national independence, a modernised education system, and a responsive government.

    Of course, the launch wouldn’t be authentically Dotcom without a little unconventional flair, and it also saw a video “manifesto” consisting of a kind of slapstick Mission Impossible parody, featuring a not-too-convincing Barack Obama lookalike trying to track down the Internet Party manifesto at Dotcom’s mansion—a document which apparently reveals how to eradicate the need for a military and oil, and turn water into bitcoin.

    But Dotcom’s not joking around when it comes to the political race. To enter Parliament, the Internet Party has to win an electoral seat or receive five percent of the vote. That might seem like a low number, but it’s by no means a given; for comparison, Julian Assange’s Wikileaks Party only got 0.66 percent of the vote in the 2013 Australian elections.

    However, Dotcom has claimed that he’s already got a sitting electorate MP onboard after talking to members of other parties in what a New Zealand Herald editorial called “the most aggressive poaching exercise in this country’s contemporary political history.”

    Before the party even launched, he’s been embroiled in political tensions. He initially planned a free “Party party” to kick off the political venture, but was forced to cancel when the Electoral Commission warned it could be seen as buying votes. Then according to local news sites, he’s been in the awkward position this week of having to defend owning Nazi memorabilia including a signed copy of Hitler’s Mein Kampf, discussion of which he dismissed as a smear campaign directed by the National Party, one of New Zealand’s two major political parties.

    Dotcom himself is of course still fighting extradition to the US on piracy charges over the now-defunct Megaupload. It seems unlikely that will do anything to deter the votes of the internet generation Dotcom’s party is targeting. Soon the polls will tell.

    In Kim Dotcom’s defense, an ultra-rare signed copy of Mein Kampf probably is as good an investment as he claims, so the purchase of that book, while eyebrow-raising, could be a innocent interest in WWII history. The larger context of Kim Dotcom’s life and apparent beliefs is really needed to assess that decision. For instance, if Kim Dotcom was videoed wearing a Nazi helmet too that would add some context:

    3 News
    Kim Dotcom defends Nazi helmet photo
    By Brook Sabin

    Political Reporter

    Thursday 27 Mar 2014 6:14p.m

    Kim Dotcom’s officially launched his Internet Party, as more Nazi images have emerged.

    3 News broke the story last night that Dotcom owns one of the rarest copies of Adolf Hitler’s Mein Kampf in existence, now, a photo of Dotcom wearing a Nazi helmet has also emerged.

    The internet mogul is in damage control after last night’s story – making a two-minute statement to reporters at the launch of the Internet Party.

    “Before anything else I want to address a very recent allegation,” Dotcom said at his mansion today.

    “It’s a smear campaign to try and derail what we are trying to achieve today for the launch of the Internet Party.

    “I will not go any further and address these things any further.”

    3 News revealed Dotcom owns a rare personally signed copy of Hitler’s Mein Kampf.

    Today, a photo emerged of Dotcom wearing a Nazi helmet at the 2004 Gumball Rally – there’s even a brief bit of video.

    “I don’t really want to respond to any of that,” Dotcom said.

    “A guy from Britain in a Porsche had this helmet on. He came to me and asked me, ‘Hey, do you want to put it on? I want to take a photo.’ I put it on, he took a photo, [and] put it on the Gumball website. It was a two-minute affair, it’s not my helmet.”

    At his party launch Dotcom released a 10-minute parody, complete with Barack Obama impersonator.

    Then came a claim the party has an ace up its sleeve. Dotcom revealed he’s poached a sitting MP who holds an electorate. He says it’s not Hone Harawira, but wouldn’t reveal any further details because there’s a confidentially agreement.

    “I don’t want to give you any hints about who it is,” said Dotcom.

    Again, it’s actually possible that Kim Dotcom just happens to own one of the rarest copies of Mein Kampf in existence and doesn’t normally dress up like a Nazi. Weird things happen when you’re a larger-than-life weirdo. No, while these are possible red-flags, the real test is his party’s policies. Are they far-right policies? Crypto-far right policies? That secret plans he mentioned above for ending the need for a military and oil sounded pretty nice. What are the details of those plans? Are there real ideas behind them or is this more larger-than-life hyped nonsense?

    For instance, since Kim Dotcom is proposing New Zeland create its own version of bitcoin, what does his tax policy looke like since a national crypto-currency would also potentially double as a national tax-evasion service. And will New Zealand’s bitcoin have a bitcoin-like fixed supply that mandates Austrain-school/Bundesbank-style economic policies? That sounds like a pretty far-right economic policy:

    The New Zealand Herald
    Chris Barton: Get back to your roots Kim Dotcom
    9:30 AM Tuesday Feb 4, 2014 143 comments

    Watching Kim Dotcom’s slow strip revealing his Internet Party plans has been excruciating: the leak to Whaleoil, the cancellation of the extravaganza launch party, the compromise of journalistic independence by unmasked party secretary Alastair Thompson, and his subsequent resignation. As a political party launch, this wasn’t a fiasco, it was a train wreck.

    The disastrous start is at odds with the supreme confidence Dotcom espoused when he discussed his political plans in September last year.

    “Everything I get into I’m a perfectionist,” he told me. “I want to be the best at everything that I do and I will make the same attempt with this political party.” Where, I asked, did such driving motivation come from? “It is just inside me. I can’t explain,” he replied. “I don’t like mediocre. That’s just my nature.” To achieve his grand plan he said: “I want to surround myself with a dream team of achievers – people who get it and want to bring this country forward and into the future.”

    So far he seems to have surrounded himself with team of ninnies and his achievements look very mediocre indeed. A mega fail. Despite the setback, I hope he perseveres because if he sticks to policy, he has an opportunity, as Derek Handley has pointed out, to give visionless New Zealand politics a badly needed jolt.

    If he can rein in his tendency to megalomania and let his charisma shine, Dotcom has unrivalled expertise in three areas that he may be able to articulate into policies. If he communicates these to perfection, he may well capture the hearts and minds of a significant constituency that may be enough to get the Internet Party across the 5 percent threshold. To do so he needs to appeal to not just the young, the disgruntled and the can’t-be-bothered-to vote, but also to a significant bunch with leanings to the right or an independent point of view.

    In other words, entrepreneurs and geeks.

    I suspect the main reason the Internet Party is in so much strife is that it’s aligned itself too much with the left which, on matters internet, has shown itself to be terribly incompetent – especially during last year’s protests against the GCSB Bill when there was no co-ordinated online and social media campaign, let alone a way to donate to the cause online. As a result, much to the dismay of many attending, the meetings were captured by old-school hard left ideology and tiresome pass-the-bucket funding collections.

    It’s worth noting that the far right, which should, through its libertarian ideology, be opposed such state intervention in individual lives, was nowhere to be seen at the GCSB bill protests. Worse still, the Act party betrayed its ideals and voted for the GCSB legislation.

    It is weird, however, that the left has taken up with Dotcom. The left is not his natural home. When he first came to New Zealand, he sought out the far right in the shape of John Banks for assistance. He’s clearly pro tax minimisation for businesses – evidenced by his setting up Megaupload in Hong Kong where it was on a 4 per cent tax rate. It’s also plain to see he’s a businessman who likes to make obscene amounts of money, flaunt his wealth with extravagant spending and have servants responding to his beck and call – hardly the hallmark of a left-winger.

    An internet party founded by a hacker with crypto-far-right views that seems to be targeting disenchanted youths under a vague banner of “digital right” and promises that the internet could solve all of our problems if it was just allowed to do so? How odd. Although it’s not as odd as the fact that story like this aren’t really very surprising anymore.

    Posted by Pterrafractyl | March 29, 2014, 3:48 pm
  3. That didn’t end well:


    Kim Dotcom election defeat: ‘My name was poison’

    Technology millionaire Kim Dotcom has apologised for his party’s failure in New Zealand’s general election.
    22 September 2014 Last updated at 12:41 ET

    His Internet-Mana Party failed to win a seat, as Prime Minister John Key’s National Party increased its majority.

    “The brand ‘Kim Dotcom’ was poison for what we were trying to achieve,” the German-born entrepreneur said.

    He is facing possible extradition to the US over MegaUpload, his storage website the US says was used to host files illegally. He denies all charges.

    Mr Dotcom – who lives in a mansion near Auckland – was arrested by armed police in January 2012.

    ‘Good luck’

    After being granted bail in February 2012, he launched the Internet Party, a political group that pledged to end government surveillance of New Zealand citizens – a stance buoyed by the allegations made by US intelligence leaker Edward Snowden.

    The Internet Party’s policies also focused on better internet access across the country.

    As a foreign national, Mr Dotcom could not himself stand in the election, and so instead appointed trade unionist Laila Harre as leader.

    The Internet Party also formed an alliance with the minor Mana Party, a breakaway group from the bigger Maori Party.

    Internet-Mana, as the partnership was named, did not attract enough votes to win a seat, with the Mana Party’s leader Hone Harawira losing his seat.

    “I’m sorry. I take full responsibility for this loss,” said Mr Dotcom after the vote.

    In a tweet, he congratulated Prime Minister Mr Key: “New Zealanders have chosen National and John Key to lead. I congratulate the prime minister. Please do your best for all Kiwis. Good luck.”

    Mr Dotcom’s fall, rise and fall again provided one of the most fascinating periods in the history of New Zealand politics.

    When I visited the sprawling Dotcom Mansion earlier this year to make a make a film for BBC Click, it was arguably at the height of the man’s popularity. He’d won a few crucial court battles related to his copyright cases, and his new website, Mega, was enjoying serious success. It still is.

    During my stay he hosted a party for the newly signed up members of the Internet Party, opening up the mansion for a day out and a chance to “Swim with Kim”.

    It was there I met one of his supporters who, while offering support, said he was worried the whole thing would struggle to become anything other than “the Kim Dotcom Show”.

    Some of Mr Dotcom’s aides suspected the young man may have been planted by an opponent – a gift for TV reporters needing a negative soundbite.

    But really that supporter was precisely what Mr Dotcom needed – a sane, dissenting voice in a world seemingly full of yes-men and women. His team was made up of fantastic, hard-working people – but it was by no means unwavering support. They were, like so many in Mr Dotcom’s life, along for the ride.

    Many suspected that Mr Dotcom’s motivation for entering politics was to help him fight his piracy case. If that was the case, it hasn’t worked.

    As Mr Dotcom’s political ambitions ebb away, the criminal charges he faces remain very real.

    His next extradition hearing is due to take place in February.

    Posted by Pterrafractyl | September 22, 2014, 2:23 pm

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