U.S. Charges 16 With Cyber Attack on Paypal Over WikiLeaks

U.S. prosecutors arrested and charged 14 people with involvement in a cyber attack on EBay Inc. (EBAY)’s Paypal unit that the group Anonymous claims it instigated in retaliation for suspending the account of WikiLeaks.

An indictment unsealed today in San Jose, California, charges the individuals with conspiracy and intentional damage to a computer. Two other defendants were arrested on cyber- related charges, the Justice Department said in an e-mailed statement. Arrests were made in 10 states and the District of Columbia and 35 search warrants were executed across the U.S. as part of an investigation into coordinated computer attacks against major companies, according to the statement.

The charges stem from “denial of service attacks” which saturate targeted computers with communication requests so service is denied to legitimate users. According to the indictment, Anonymous was an online collective of individuals associated with collaborative hacking attacks motivated by political and social goals, and the group referred to the attacks on Paypal as “Operation Avenge Assange.” Julian Assange is WikiLeaks’ founder.

Paypal cut access to the whistle-blowing website WikiLeaks.org in December after the U.S. said WikiLeaks activities violated the law. Anonymous later took credit for a denial of service attack on Paypal as punishment for the company’s actions. A federal grand jury in San Jose began taking evidence in February as prosecutors probed attacks on Paypal, MasterCard Inc. and Visa Inc.

Anuj Nayar, a spokesman for Paypal, said the company has no comment on “ongoing legal action.”

“PayPal works with law enforcement around the world to protect our customers and their accounts,” Nayar said in an e- mailed statement. “As we state in our privacy policy, PayPal works with law enforcement or government officials if we receive a subpoena or court order; if we need to do so to comply with law; or if we believe in good faith that illegal activity has occurred.”

The case is U.S. v Cooper, 11-471, U.S. District Court, Northern District of California (San Jose).

To contact the reporters on this story: Karen Gullo in San Francisco federal court at kgullo@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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