Feds Indict Two Lawyers For Allegedly Running Shakedown Racket That Used Deceptive Copyright Lawsuits To $queeze Victims Who Supposedly Downloaded Online Porn Movies; Indictment: Pair Used Threats Of Huge Financial Penalties & Public Embarrassment To Pocket Approx. $6 Million

From the U.S. Department of Justice (Washington, D.C.):

• Two attorneys were charged [] in a federal indictment for their roles in a multimillion-dollar scheme to fraudulently obtain settlement agreements from individuals who supposedly downloaded pornographic movies from file-sharing websites.
  
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  Paul R. Hansmeier, 35, of St. Paul, Minnesota, and John L. Steele, 45, of Florida, were charged in an 18-count indictment [] for conspiracy to commit wire fraud and mail fraud, substantive wire fraud and mail fraud, concealment money laundering and conspiracy to commit and suborn perjury. Hansmeier was suspended from the practice of law in the state of Minnesota on Sept. 12, 2016.
  
  “Abusing one’s position as a licensed attorney and using the courts and legal process to file false and abusive copyright claims that threaten individuals and encourage fraudulent settlements is wrong and will not be tolerated,” said Assistant Attorney General [Leslie R.] Caldwell.
  
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  “The defendants in this case are charged with devising a scheme that casts doubt on the integrity of our profession,” said U.S. Attorney [Andrew M.] Luger. “The conduct of these defendants was outrageous – they used deceptive lawsuits and unsuspecting judges to extort millions from vulnerable defendants.
  
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  “The charges announced [] describe a fraud scheme perpetrated by lawyers and officers of the court who abused their positions of trust for personal enrichment,” said Special Agent in Charge [Richard T.] Thornton. “The FBI remains committed to uncovering fraud such as this to protect the integrity of our civil justice system.”
  
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  “The role of IRS Criminal Investigation becomes even more important in complex financial investigations involving money laundering because of the time it takes to unravel the criminal scheme,” said [IRS] Chief [Richard] Weber. “This case is an excellent example of the lengths to which individuals will go to defraud others in whatever way they can. We are committed to working these types of difficult financial investigations and following the criminal’s money, wherever it leads.”
  
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  According to the indictment, between 2011 and 2014, Hansmeier and Steele, both practicing lawyers, executed a scheme to fraudulently obtain approximately $6 million by threatening copyright lawsuits against individuals who supposedly downloaded pornographic movies from file-sharing websites.
  
  Hansmeier and Steele allegedly created a series of sham entities to obtain copyrights to pornographic movies that they uploaded to file-sharing websites and filed bogus copyright infringement lawsuits in order to learn the subscriber information associated with the IP addresses used to download the pornographic movies. The indictment further alleges the defendants used extortionate letters and phone calls to threaten victims with enormous financial penalties and public embarrassment unless they agreed to pay a $4,000 settlement fee.
  
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  In total, the defendants obtained approximately $6 million from the fraudulent copyright lawsuits, [according to the indictment].

For more, see Two Attorneys Indicted for Multimillion-Dollar Scheme to Fraudulently Obtain Settlements from Victims Who Downloaded Pornography.