How Amazon and eBay became a tax haven for Chinese sellers

For years, Amazon customers in Europe have enjoyed the shopping giant’s ability to deliver everything from best-selling books to phone chargers within days, if not hours, at prices that brick-and-mortar retailers often cannot match. Much like in the United States, online sales are eating up physical retail market shares. By 2023, it’s predicted that 21 percent of all non-grocery retail sales in Europe’s biggest economies will be online, up from just 13 percent last year. But, increasingly, the large digital platforms, which also operate as marketplaces for third-party sellers, have come under fire for helping foreign retailers skirt taxes.

In the EU, practically all marketplace sellers are required to report and pay a sales tax called value-added tax, or VAT. In the UK, the standard VAT rate is 20 percent; in Germany, it’s 19 percent. But recent reports indicate that thousands of vendors that are selling on Amazon and eBay’s marketplaces, many of which are from China, are not paying their VAT, which allows them to undercut local physical and online retailers even further. Now, the UK, Germany, and the EU Commission are stepping forward to hold marketplace operators accountable for tax fraud amounting to around $5 billion a year across Europe, according to estimates by the EU Commission.

According to Mark Steier, a data analyst and e-commerce consultant who first revealed the scheme in Germany, there are approximately 15,000 Chinese traders registered on Amazon’s German Marketplace. But one-third of them have not indicated a VAT identification number in their profile, Steier told The Verge. And from his experience, many of the VAT identification numbers offered are not valid. Steier estimates that on Amazon alone, there are about 10,000 sellers from China withholding VAT from the German state. Research by public broadcaster WDR and daily Süddeutsche Zeitung shows similar numbers. According to Steier, there are over 10,000 more VAT-avoiding Chinese traders on eBay. Germany’s Ministry of Finance has suggested that the annual loss of tax revenue caused by online VAT fraud amounts to several hundred million euros.

A recent purchase exemplifies the problem. This August, a Munich-based Amazon user named Michael (who requested only his first name be used for this article), found printer cartridges at a bargain: a pack of four for €8,99 with, thanks to Prime, no additional shipping costs. Amazon indicated that the price already included German VAT. The order was processed and delivered by Amazon, but the actual seller was a company called Cseein. The next day, Amazon’s delivery service brought a padded envelope containing the cartridges but no invoice. Michael sent an email to Cseein asking for it. The company replied quickly.

At first glance, the document looked good. It included an invoice number, Michael’s Munich address, and the company’s address in Guangdong, China. But there was something missing. Usually, there are three lines at the end of an invoice: the first indicates the net amount, then the VAT, and the third states the actual price, which is the sum of the two other figures. Here, the VAT wasn’t mentioned, and the company did not provide a VAT identification number.

For lawyer Nathalie Harksen, a VAT expert at Frankfurt-based law firm AWB, the incomplete invoice is an indication that the company probably didn’t pay the VAT — although there are clear reasons why the company would have been obliged to do so. Even though Cseein does provide a VAT number on its Amazon Marketplace profile page, that’s of no use in this case, Harksen explained, as it’s a British VAT number. When asked whether the company paid VAT over email, a representative from Cseein replied: “we pay the VAT to UK, all we sell on EU and it will be accepted.” The company obviously assumed that the email came from a disappointed customer and made an offer: “we can refund you the VAT. can you accept it.” When shown the correspondence, Harksen said, “There doesn’t seem to be any knowledge of European tax law here.”

For governments, lost taxes can impact budgets. But for vendors who play by the rules and pay their VAT, competitors who undercut their prices by avoiding VAT are a threat to their very existence.

Martin, a German Amazon Marketplace retailer (who also asked that his real name be concealed), has been selling bags on Amazon and eBay for years. “When I see the students walking by, I immediately recognize this backpack is from China, this backpack is from China, and the next backpack is also from China,” he told The Verge.

Martin says he sold some of the same imported Chinese-made products as Chinese dealers on Amazon, but because he’s based in Germany, he’s forced to pay VAT or else risk fines or even a prison sentence. Meanwhile, he says Chinese vendors are avoiding their 19 percent VAT and spoiling his business. He cites the VAT fraud as the main reason for the lower prices of rivals from China that already benefit from cheaper procurement.

“We once developed our own toilet bag, of which we sold 10,000 to 12,000 units per year on Amazon Marketplace. Now, we only sell 400 a year.”

Although Martin mainly blames politicians and the government for failing to enforce VAT, he also criticizes Amazon and eBay. “The marketplace operators should have an interest in things being right there. But they don’t seem to care where their commission comes from,” he said. After all, many of the tax-fraudulent Chinese vendors use the Fulfillment By Amazon (FBA) service. That enables them to deliver just as quickly as German retailers because their goods are already stored in local Amazon warehouses.

VAT evasion is not unique to Germany. In 2014, a group of UK sellers formed an online initiative called “Campaign against VAT Fraud on Ebay & Amazon in the UK.” Thousands of Chinese dealers are suspected of not having paid the 20 percent VAT and thus harming domestic vendors. Due to online VAT fraud, UK taxpayers lost $1.3 billion to $1.9 billion in 2015 and 2016, according to estimates by a government agency.

Efforts to enforce online VAT in the UK have fallen short. In 2016, new powers to tackle the fraud were introduced, including making online marketplaces potentially liable for non-payment of VAT of overseas sellers that are using their platforms. “From these laws, thousands of non-compliant overseas businesses have been removed from online marketplaces, and over 40,000 overseas sellers have registered for VAT,” Ruth Stanier, director general for customer strategy and tax design at Her Majesty’s Revenue and Customs (HMRC), told The Verge. However, not everyone was satisfied with the way HMRC made use of its new powers.

In October 2017, the Public Accounts Committee of the British Parliament criticized the authorities for not doing enough to combat online VAT fraud. In a report, the committee described HMRC as “playing a game of cat and mouse” with companies based outside the UK. Since then, HMRC has further strengthened its rules and has also pushed online marketplaces to sign a voluntary agreement committing them to provide data about individual sellers to HMRC, including the volume and value of their sales. Amazon, eBay, and four other companies have already signed in. An eBay spokesperson told The Verge: “We work closely with HMRC to ensure our sellers comply with their VAT obligations.”

Germany is also taking legislative action. On August 1st, Angela Merkel’s cabinet passed a bill from the Ministry of Finance that, if approved by Parliament, will force online marketplaces to cooperate with tax authorities from 2019 onward. Starting January, they’ll have to report data about their seller, just like in the UK. If sellers still don’t pay their taxes, Amazon, eBay, and other marketplaces will be held accountable for lost funds. The bill is expected to pass into law.

Back in 2016, Amazon’s stance on the German VAT problem could be described as none of our business, or in the company’s own words: “Amazon dealers are independent companies and responsible for fulfilling their tax obligations.”

After two years of bad press and political debate, today, the company sounds more committed to enforcing sellers to pay VAT. Though Amazon didn’t want to comment on the government’s plans, the company told The Verge that it fully supports VAT compliance and offers extensive information, training, and tools to assist sellers. “If we are notified by a German tax authority that a seller is not VAT compliant, we will promptly block the account,” a spokesperson said.

Amazon and eBay marketplace vendors evading VAT could face even more pressure soon: the European Union is working on laws that will make online marketplaces responsible for ensuring VAT is collected on sales on their platform. The legislation should apply from 2021 on.

But the fixes could be short-lived: as Chinese e-commerce giant Alibaba expands in Europe, merchants could start placing cheap VAT-free offers there, too. European authorities have less control over Alibaba than Amazon and eBay.

Justice Department will meet with states about tech companies allegedly ‘stifling’ ideas

Following today’s Senate committee hearing with Jack Dorsey and Sheryl Sandberg, the Justice Department has released an unexpected statement. The agency says it will soon convene a meeting of state attorneys general to discuss allegations that tech companies are “hurting competition” and “intentionally stifling” ideas.

While the statement does not fully lay out the implications, it seems to be referencing criticism from some conservatives who have levied questionable claims of political censorship against social media platforms. President Trump ignited the issue last week with dubious claims that Google’s search results were “rigged” against him, a charge that Google has denied.

The Justice Department says Attorney General Jeff Sessions has convened a meeting with “a number of state attorneys general this month.” The agenda, according to the statement, will include the “growing concern that these companies may be hurting competition and intentionally stifling the free exchange of ideas on their platforms.”

Amid continuing questions about Russian government meddling on social media, several Republican lawmakers have taken time to question the perceived biases of Big Tech. Mark Zuckerberg was questioned about the issue during congressional hearings, notably by Sen. Ted Cruz, and a House hearing was also held on the issue. (A Democratic lawmaker derided the latter as “stupid.”) Dorsey is scheduled for a second hearing this afternoon, where he may face further questions about the topic. But legal action from states or the federal government would be a major escalation from the current level of debate.

The Justice Department’s statement follows:

“We listened to today’s Senate Select Committee on Intelligence hearing on Foreign Influence Operations’ Use of Social Media Platforms closely. The Attorney General has convened a meeting with a number of state attorneys general this month to discuss a growing concern that these companies may be hurting competition and intentionally stifling the free exchange of ideas on their platforms.”

Texas and New York City are slashing inmate phone call rates

For years, inmate advocates have argued that the cost of a phone call from a prison or jail is onerously high, and inmates’ families are footing the bill. While the FCC, under the Obama administration, moved to broadly cap rates, the Trump-era agency declined to defend the caps in court, where they were struck down. The result has been a demoralizing setback for those pressing for regulation of the billion-dollar-plus industry.

August, though, has brought some isolated signs of change. Earlier in the month, New York City moved to make all calls from jails free, becoming the first major city to do so. The city council speaker explained in a statement that “the city has been profiting from some of the poorest and most vulnerable New Yorkers for years.”

Last week brought more news. The Texas prison system voted to cut the cost of calls from 26 cents per minute to 6 cents, even lower than the FCC’s planned cap. The Houston Chronicle reports that a 15-minute call that previously cost $3.90 will now cost 90 cents.

Still, the changes in cities and states, while notable, are short of the regulation inmate advocates once hoped for under the Obama FCC. In 2015, the FCC passed its caps on a party-line vote by Democratic commissioners. Current FCC chairman Ajit Pai, then a commissioner, opposed the rules at the time, and he made the decision to drop the legal battle once appointed by Trump to lead the commission. There has since been no sign of taking up action again.

Amazon accuses Sen. Bernie Sanders of misrepresenting worker pay, tells workers to send him positive stories

Amazon has issued a statement defending itself from criticism by Sen. Bernie Sanders (I-VT), who is preparing a bill that will tax companies for money spent on their employees’ food stamps and other low-wage benefits. Amazon claims Sanders has made “misleading statements about pay and benefits” at the company, and it says it’s encouraging employees to contact Sanders with their positive experiences.

The statement repeats several of Amazon’s previous comments about worker pay at its fulfillment centers. It touts the company’s “highly competitive wages and a climate controlled, safe workplace” and says that many employees who qualified for the Supplemental Nutrition Assistance Program (SNAP, known until 2008 as the Food Stamp Program) worked part-time or were only briefly employed at Amazon.

Sanders discussed his bill yesterday in an interview with TechCrunch, where he said that “many, many thousands of Amazon workers in their warehouses throughout the country are earning very low wages.” He said that while collecting data was difficult, “from what information we’ve gathered, one out of three Amazon workers in Arizona, as we understand it, are on public assistance. They are receiving either Medicaid, food stamps or public housing.” Amazon didn’t specifically address this statistic.

Sanders’ site includes a form for Amazon workers to submit experiences with the company. While it references negative experiences, Amazon posted a tweet from Amazon head of global operations Dave Clark, who is encouraging employees to write to Sanders if they’re not receiving SNAP aid. Amazon recently launched an “ambassador” program where fulfillment center employees defend the company’s working conditions on Twitter.

Sanders’ bill isn’t specifically anti-Amazon, and other major companies — particularly Walmart, another frequent Sanders target — force large numbers of low-wage employees to rely on SNAP and other programs. But Sanders is drawing attention to a recurring sore spot for Amazon, which has defended itself against numerous reports of rigid micromanagement, low pay, and dangerous warehouse conditions. The state of Indiana fined it for safety violations last year after a worker was crushed by a forklift.

Sanders responded by defending his claims and calling on Amazon to release more information about its worker pay, especially for people it hires through temporary staffing agencies. “Amazon’s median employee pay is only $28,446 — 9 percent less than the industry average and well below what constitutes a living wage in the United States,” he said in a statement. “Further, we believe that many of Amazon’s workers are employed by temporary staffing agencies and contractors and make even less than the median Amazon employee.” He plans to introduce his tax bill on September 5th.

Update 1:00PM ET: Updated with statement from Sanders.

Ajit Pai killed net neutrality but still wants you to love the FCC

The Federal Communications Commission launched a podcast yesterday, playfully named after George Carlin’s famously explicit standup routine. The show, More Than Seven Dirty Words, will interview people inside and outside the FCC about what the commission does and how it impacts the real world.

But the podcast’s introduction — and the FCC’s announcement about it — reveals something odd and frustrating that speaks to the current state of the commission: the FCC thinks no one cares about what it does. The podcast’s host, Evan Swarztrauber, previously of the libertarian think tank TechFreedom, opens with an explanation for people who “haven’t had the pleasure of taking a telecom law class” and closes with the tongue-in-cheek promise of attempting to “achieve the impossible: make telecom policy interesting.”

But here’s the thing: telecom policy is really, really interesting. Just ask the millions of people who figured out the agency’s byzantine commenting system in order to leave their thoughts on the 2017 proceeding to end net neutrality. Or the millions who commented on the 2014 proceeding, too.

Telecom policy can be made immensely dull — particularly when you refer to it as “telecom policy” — but when you put it in terms that people understand, like “blocking websites,” “improving Wi-Fi,” and “deploying faster internet,” it turns into something that many people have passionate opinions on. The FCC regulates critical and fascinating technology that most Americans interact with nearly every single day, often quite extensively. It’s not hard to get people interested.

In the podcast’s introductory episode, FCC chairman Ajit Pai says he thinks many people learned of the commission “from certain controversies they see in the news” and that the show will be a way of “getting the message out” about what the agency really does. He and Swarztrauber see the podcast as a way to highlight the lower-profile work being done inside the commission.

They’re not wrong: most of the commission’s work is dealing with dry, agreeable technical issues like how powerful emissions can be from a radio tower. The first episode fully steers clear of politics and focuses on the work of a career FCC attorney who grew up in Puerto Rico and went there after Hurricane Maria to help on behalf of the commission. It’s an important subject, but the show isn’t designed to engage with listeners on the actual issues the agency faces in dealing with a catastrophe, or likely anything else.

That’s not going to accomplish the podcast’s stated goal. And, realistically, the commission probably doesn’t want the attention anyway since people might not like it if they found out what the agency has been doing: removing broadband subsidies for low-income households, hiding information on a program that pays for computer equipment in schools, and generally giving internet providers — some of the most despised companies in the country — carte blanche to treat websites, apps, and internet traffic as they please.

People have strong opinions on these things. But again and again, Ajit Pai’s commission doesn’t take their side and reacts with offense when hearing their concerns. The FCC and its chairman were even clear about the fact that they wouldn’t really be taking people’s opinions into account during the proceeding to destroy net neutrality, saying they would be valuing comment “quality” over “quantity,” which seemed to mean that anything shy of a legal brief would be ignored.

If the FCC wants to get people engaged and interested in what it’s doing, it really just needs to ask. But instead, the commission launched a podcast that begs for people to listen, while refusing to listen to anyone else.

Verizon says throttling firefighters wasn’t about net neutrality — was it?

When news broke this week that Verizon was slowing California firefighters’ data speeds during a wildfire crisis, there was a predictable outrage over the company’s actions. In a legal brief filed by Santa Clara County fire officials against the FCC’s net neutrality repeal, emergency responders explained how Verizon dropped their connection to a crawl, even after being informed of the emergency. The company didn’t restore the speeds until the fire department paid for a better plan.

While Verizon admitted that it made a customer service policy mistake, it was also quick to deny one point: “This situation has nothing to do with net neutrality or the current proceeding in court,” a spokesperson said in the first line of the company’s response to the incident.

Verizon, to its point, was throttling “unlimited” customers in less extreme circumstances who hit certain data thresholds well before last year’s net neutrality repeal. The legal brief also says the filers are not arguing that the throttling would necessarily have been a violation of the previous net neutrality rules, which were passed in 2015. Still, the filers of the brief do argue that the problem is about net neutrality in a different sense.

The throttling may not have been a violation of the previous rules, but the brief, also filed by attorneys general in 22 states, argues that the FCC failed to take public safety into account when it passed its repeal. “That was part of the FCC’s original mandate: it needs to be thinking about public safety in its rulemaking,” says Santa Clara County counsel James Williams. As the FCC is required to consider the interests of public safety, the FCC’s repeal is therefore “arbitrary and capricious,” the brief argues.

The throttling, the filers say, also showed how service providers will be willing to act in ways that benefit themselves financially in the absence of regulations. “We should expect nothing less than an ISP to act in its economic interest — that’s its job,” Williams says. (Verizon said in its statement that its practice is to not enforce slowdowns during emergencies and that it has removed similar restrictions in other emergency situations.)

Others have pointed out that, under the previous rules, customers had a path to complain to the FCC when they believed throttling was unfair. In this case, that route was largely re-directed to the FTC, a structure that’s been criticized as insufficient.

Gigi Sohn, who worked on the net neutrality rules under the previous FCC chairman, argues that there is some question about whether Verizon’s actions would have violated the 2015 rules. But, regardless, she believes the repeal eliminated a route that would have given them recourse to make an expedited case in front of the agency, which could have resolved the dispute more quickly. Instead, Verizon and the fire officials had a frantic, lengthy back-and-forth over email, an exchange that appeared in the brief.

“If the net neutrality rules were still in place,” Sohn says, “trust me, I don’t think there would’ve been a monthlong conversation about this.”

22 states ask court to restore net neutrality

Attorneys general representing 22 states and the District of Columbia asked a federal court to reinstate net neutrality, saying the Federal Communications Commission failed to properly consider the issues when removing the policy in 2017.

In a brief filed last night, the attorneys general argue that the FCC’s decision “will cause [inevitable harms] to consumers, public safety, and existing regulatory schemes” and that the commission “entirely ignored many of these issues” when overturning net neutrality.

In particular, the attorneys general say that the commission failed to consider public safety concerns that could come from the loss of net neutrality. That’s a critical problem, they say, because public safety is part of the agency’s forming statute.

The brief also says the obvious: that the FCC just outright ignored a lot of clear evidence that internet providers aren’t the honest lot they claim to be. The FCC accepted industry promises, they write, despite “substantial record evidence showing that [broadband] providers have abused … and will abuse their gatekeeper roles in ways that harm consumers and threaten public safety.”

New York AG Barbara Underwood led the brief, which was also joined by attorneys general representing states from coast to coast, including Maine, Illinois, Iowa, New Mexico, and California. The filing lays out the states’ arguments in an ongoing lawsuit against the FCC, which is also being fought by Mozilla, Vimeo, Etsy, Free Press, the National Hispanic Media Coalition, and several others. Those groups also filed a brief last night, calling the FCC’s actions a “wholesale abdication of its statutory responsibilities.”

The lawsuit seeks to overturn the 2017 order that removed net neutrality by having it ruled “arbitrary and capricious,” which would mean that the FCC failed to fully consider the issues at hand when making its decision. While federal agencies are largely given deference to make policy as they’d like so long as it’s within their legal authority, the agencies do still have to justify their decisions. The question here is whether the FCC did so properly and fully, just two years after it had last considered the issue of net neutrality.

While the goal of the lawsuit is to have net neutrality reinstated, the states do have a backup request: that the court should allow them to make their own net neutrality rules. Even if the crux of the lawsuit fails and net neutrality remains in place, they ask that the court rule a portion of the FCC’s order that bars states from making their own net neutrality laws to be invalid. The commission, they write, “identified no valid authority” that would allow it to block states from making such rules.

The FCC failed in a similar attempt to block state rules that prevented cities from starting their own broadband networks back in 2016, which may speak to the states’ chances here.

In June, the order overturning net neutrality went into effect after being passed in late 2017. Legal challenges have been moving since the minute the vote happened. These filings are another step forward, but oral arguments are still yet to be scheduled.

Facebook will remove 5,000 ad targeting categories to prevent discrimination

Facebook’s latest attempt at placating activists and lawmakers who say its advertising platform permits discrimination is to remove 5,000 options that can be used to exclude certain religious and ethnic minority groups.

The company’s response, outlined in a blog post today, arrives just a few days after the US Department of Housing and Urban Development (HUD) filed an official complaint against the company alleging it violated the Fair Housing Act. The HUD investigation findings were just the latest in a multi-month series of mea culpas from Facebook representatives and ongoing litigation from nonprofit groups. The HUD complaint also opened the door to a federal lawsuit, reports The Washington Post, perhaps prompting Facebook to take more definitive action.

The removal is scheduled to happen this fall, and it will prevent advertisers from excluding identifiers like “Native American culture,” “Islamic culture,” and “Buddhism,” among thousands of others, reports BuzzFeed. Those categories are based on optional behavior on behalf of Facebook users, including likes and participation in groups and pages. However, they can be used as proxies to racially discriminate against certain users in ads for housing, employment, and other federally regulated markets, according to investigative journalists who have repeatedly bypassed Facebook’s safeguards to purchase test ads.

“We’re committed to protecting people from discriminatory advertising on our platforms. That’s why we’re removing over 5,000 targeting options to help prevent misuse,” reads Facebook’s blog post. “While these options have been used in legitimate ways to reach people interested in a certain product or service, we think minimizing the risk of abuse is more important. This includes limiting the ability for advertisers to exclude audiences that relate to attributes such as ethnicity or religion.”

In 2016, ProPublica began an extensive look at Facebook’s ad platform, initially revealing that Facebook’s targeting tools permitted advertisers to exclude black Americans from housing ads, which is a violation of federal law. This was possible because Facebook has historically included targeting options under the name “ethnic affinity,” claiming that a user’s affinity for certain pages, groups, and other Facebook content did not technically correspond to their race or religious background. (The company has since renamed the targeting category from “ethnic affinity” to “multicultural affinity,” and it’s reclassified it as a behavior instead of a demographic.)

In numerous subsequent reports, ProPublica and other news outlets discovered that those same tools let advertisers exclude multiple ethnic groups, religious groups, and other protected classes from not just housing ads, but ads for employment and insurance. Investigations also found that by using ZIP codes and other targeting techniques, advertisers could even bypass relying on racial identifiers by engaging in what’s called redlining, an age-old discrimination technique that deprives certain geographic areas of resources. Even after Facebook claimed to address the problem, the discrimination tools remained intact and the company’s algorithmic and human review systems failed to catch obvious examples.

Earlier this year, Facebook permanently removed advertisers’ ability to use these multicultural affinity groups for any type of advertising, following a temporary ban on the activity last year. It also signed an agreement with Washington state in July pledging to scrub its platform of discriminatory targeting tools that went beyond race and religion and included veteran and military status, disability status, national origin, and sexual orientation.

Now, it looks like Facebook is going even further by removing thousands of additional identifiers across the board, and not just for ads in categories that invite federal oversight like housing and employment.

“We want to help educate advertisers about their obligations under our policies. For over a year, we have required advertisers we identify offering housing, employment or credit ads to certify compliance with our non-discrimination policy. In the coming weeks, this new certification will roll out gradually to US advertisers via our Ads Manager tool,” reads the blog post. “Advertisers will be required to complete this certification in order to continue advertising on Facebook. We’ve designed this education in consultation with outside experts to underscore the difference between acceptable ad targeting and ad discrimination.”

EU considers fines for tech companies that don’t remove terrorist content within an hour

The European Union is considering tough new laws that would force tech companies like Facebook and YouTube to delete terrorist propaganda from their platforms within 60 minutes or face fines. The Financial Times reports that the legislation is currently being drafted by EU lawmakers who have lost patience with firms’ inability to police their sites.

Speaking to the FT, the EU’s commissioner for security, Julian King, said that Brussels had “not seen enough progress” on this issue, and was willing to take “stronger action in order to better protect our citizens.” King said, “We cannot afford to relax or become complacent in the face of such a shadowy and destructive phenomenon.”

Legislation on the issue was passed in March, complete with the same 60-minute window for companies to delete terrorist content after it has been flagged. However, these were only voluntary guidelines, and the legislation currently being discussed would likely include the threat of fines for firms that don’t meet this target.

Keeping online platforms clear of terrorist content has become a top priority for European governments after a string of attacks rocked Paris, London, and Berlin in recent years. Although US companies have responded with increased automated and human-led moderation, these efforts still can’t hope to comprehensively police sites where billions of users upload new content every day. What the EU wants is faster response times.

The problem of moderation will be tougher for companies without the resources of big tech firms. King told the FT that the legislation would cover all sites, regardless of size. This might end up impacting smaller companies unfairly, but King says this blanket rule is needed to make sure that infringing content isn’t just pushed to smaller platforms.

“The difference in size and resources means platforms have differing capabilities to act against terrorist content and their policies for doing so are not always transparent,” said King. “All this leads to such content continuing to proliferate across the internet, reappearing once deleted and spreading from platform to platform.”

Any legislation, after being announced in full, would need to be approved by both the European Parliament and a majority of EU states.

Florida man arrested in alleged multi-state SIM card hacking ring

Florida authorities made an arrest last month in an alleged multi-state SIM card hacking ring, the latest in a series of similar incidents.

According to court records first unearthed this week by reporter Brian Krebs, law enforcement learned of the plot when a mother in Michigan overheard her son pretending to be an AT&T employee and called investigators. Authorities turned up, searched the son’s room and his computer, and discovered files with a list of names and phone numbers, along with SIM cards and cell phones.

After more searching, officers say they discovered SIM cards that led to seven victims in seven states, and who said their identities were stolen and cryptocurrency accounts pilfered of hundreds of thousands of dollars. Officers interviewed the son, who allegedly said about eight others, including a man named Ricky Handschumacher, were involved. According to the officers’ account, Handschumacher discussed the fraud scheme in Discord conversations.

Officers said Handschumacher and others in on the plan would steal personal information, then either impersonate or pay off a cellular service employee to receive a new SIM card with the target’s stolen information. Using that, they could crack any passwords tied to the phone number, including cryptocurrency accounts. Police say Handschumacher told them he had laundered more than $100,000 through cryptocurrency exchanges, although he has pleaded not guilty to the charges.

As Motherboard has documented, the SIM-impersonation technique, sometimes called “SIM-jacking,” is an increasingly popular, dead-simple way for hackers to take over accounts from unsuspecting marks. In another case last month, police say a California man stole millions of dollars in cryptocurrency using the technique.