Feds, DirecTV Team to Sting Pirates

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At least 26 people were charged last week with satellite-television signal theft in the wake of separate, nationwide investigations into the illegal sale of DirecTV Inc. security cards.

The U.S. Justice Department and the U.S. Customs Service last Tuesday jointly announced that a 22-month sting called "Operation Smartcard.net" had resulted in four guilty pleas and seven arrests.

With cooperation from DirecTV and its security-access technology provider, NDS Americas, the government agencies created an undercover Web site to attract DBS pirates who traffic in the illegal cards. The electronically modified cards allow owners of DirecTV hardware to access any of the service's programming for free.

Nearly 3,600 cards were sold in the sting.

"We didn't create eyeballs that wouldn't have been there," said DirecTV vice president of signal integrity Larry Rissler. If the hackers hadn't purchased the smart cards from the government, they would have bought them elsewhere, he added.

As part of its ongoing efforts, DirecTV's law firm in June sent out 349 cease-and-desist orders to Web sites that advertise illegal smart cards.

Customs officials estimated that illegal cards provide access to about $6.2 million in stolen programming each year.

DirecTV's programming partners were not notified about the sting in advance, because, Rissler said, "It would be difficult from a practical standpoint to get all of them involved in a covert operation."

In Los Angeles last Tuesday, the FBI announced that 15 people from across the U.S. were arrested for the alleged reprogramming and sale of DirecTV smart cards. The defendants earlier this month had been indicted for mail fraud and other criminal charges by a Los Angeles-based federal grand jury.

A number of state and federal agencies can have jurisdiction over DBS signal theft, depending on the circumstances, Rissler said. The customs service is responsible in cases that cross national borders, such as when illegally modified cards come from Canada. In most cases, the FBI has primary authority.

EchoStar Communications Corp. was not involved in either of the investigations announced last week. The company declined to comment on anti-piracy efforts.

DirecTV often gets tips about signal theft from satellite dealers, who lose out on their programming commission if they sell an illegally activated DBS receiver.

In the days of large-dish, C-band satellite television, satellite retailers sometimes dealt in illegally modified receivers. But today, Rissler said, DBS pirates more often deal in other stolen services, too, such as cable and cellular signal theft.

The Internet also allows illegal smart-card traffickers to advertise almost anywhere.

Rissler hopes the widely publicized crackdown will cause potential signal thieves to think twice before buying the modified smart cards online.

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