Feds Close In On Megaupload Founder Kim Dotcom

He's got funds and a name like a digital era supervillain--and the vanity plates to match on his turbo Benzo. But can the hefty dual citizen of Germany and Finland move fast and furiously enough to evade the law?

Kim Dotcom is a hard man to reach. The founder of Megaupload.com, the popular file-sharing site the Federal prosecutors just shut down, has been accused of costing copyright holders more than $500 million in lost revenue from pirated content uploaded to his service--movies, music, TV shows, and so forth. But the chief innovation officer, who oversees more than 30 employees in nine countries, has made a business of testing the legal limits--his umbrella company has pulled in roughly $175 million, according to court filings, of which he received more than $42 million in 2010.

Inquiries to Megaupload over the past year have not been responded to; when I reached out to a source this week who had a connection to Dotcom, the source responded, "Sorry, but Kim told us explicitly not to put him in contact with journalists." But Dotcom hasn't been able to evade the Feds: Prosecutors have indicted him and six other defendants over online piracy, and are seeking the forfeiture of $175 million, dozens of bank accounts around the globe, as well as a stable of Mercedes-Benzes, Maseratis, Rolls-Royces, and Lamborghinis boasting vanity license plates that likely reflect the Dotcom era of Megaupload: "Good," "Evil," "CEO," "God," "Stoned," "Mafia," "Hacker," and perhaps most telling, "Guilty."

According to court documents, Dotcom owns roughly 68% Megaupload.com, Megaclick.com, and Megapix.com, subsidiary sites of the Mega Conspiracy brand. Dotcom also owns 100% of registered companies Megavideo.com, Megaporn.com, and Megapay.com. This family of sites grew to include more than 180 million registered users. Premium members of the service helped bring Mega Conspiracy more than $150 million, according to the Feds, while online advertising help the company bring in another $25 million.

To give some sense of just how large Dotcom's dot-com business grew, between roughly 2006 through 2011, Mega Conspiracy's PayPal account is said to have received over $110 million from subscribers and other associated persons. Fees for accepting payments on PayPal range from about 2% to as high as 3.9% for international transactions; thus, even a low-ball estimate would suggest PayPal likely made millions of dollars from Dotcom's operations.

The indictment charges come not just as SOPA is a hotly debated topic in Washington, but as Megaupload attemped to make the shift toward becoming a more legitimate operation. Last month, the site received a makeover that included celebrity endorsements from Kim Kardashian, Kanye West, and Will.i.Am; Swizz Beatz was even appointed CEO (though the hip-hop artist was not named in the indictment).

Kim Dotcom even made a rare public appearance in a video uploaded to Megaupload's homepage, and wrote a diatribe for Torrentfreak.com in which he took YouTube and Universal Music Group to task over copyright issues. The name of the article he wrote? "From Rogue to Vogue." Megaupload has since been taken down, but there are a few other appearances by Dotcom in videos on the web, including the one below, in which he's accused of street racing in the Gumball Rally, the real life Cannonball Run. The gold can be found 36 seconds in, just after the shot of Dotcom in a Nazi SS helmet when he declares in his German-Finnish accent, "When we are on the highway, we go PSSSSSST!"

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