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Anonymous domain registration nixed amid fraud complaints

Directi strikes back

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A company that provides a controversial service to domain name registrars says it is severing ties with Estdomains amid complaints that the Eastern European company makes it too easy to register sites that are used by spammers and scammers.

Directi, through a subsidiary called LogicBoxes, had been providing an array of products and services to Estdomains, including one known as PrivacyProtect, which shields the identity of domain-name owners. Critics have long claimed it is used by operators of sites that engage in spam, malware and other illegal acts.

About a month ago, Directi amended its relationship with Estdomains and stopped providing the Estonian registrar with the PrivacyProtect service, company officials said. While PrivacyProtect is used by many registrars, they say most of the abuse came from customers registering sites through Estdomains. That, in turn, prompted Directi to terminate its agreement in hopes that anti-fraud proponents would stop targeting the service.

"Just the reputation loss and the confusion because of these linkups has been more detrimental to us than the commercial gain from that one-off sale," said Directi CEO Bhavin Turakhia. "We felt it was the right move morally."

Turakhia's comments came in response to an El Reg article published Tuesday that he takes strong exception to. Among other things, he strenuously contested the claim made by security researchers that LogicBoxes is associated with network provider Atrivo, which the researchers found to host malware, malicious websites and other net-based parasites.

The alleged connection was the frequent use of PrivacyProtect by many of Atrivo's less reputable customers. These customers were using the service through Estdomains, not directly through LogicBoxes, so any claim of an association in inaccurate, Turakhia said.

Turakhia also challenged claims in a second report mentioned in our article that Directi had established 48 "phantom" registrars that appeared to violate policies mandated by the Internet Corporation for Assigned Names and Numbers requiring their physical location to be disclosed on websites operated by ICANN and InterNIC. In fact, Turakhia said, the registrars, which belong to Directi and possibly several of its clients, are completely legitimate enterprises that are in full compliance with all ICANN requirements.

"In order to get ICANN accreditation, they have to go through a very complicated due diligence process where ICANN verifies the appropriate documents, the financial stability, the business stability, technology capability of these companies," he said.

The companies are incorporated in Delaware, although no employees actually work there, Turakhia added. Listings for all 48 registrars contain a phone number and email address where a principal can be reached.

Indeed, Stacy Burnette, director of contractual compliance at ICANN, said the organization is satisfied the registrars are incorporated in the location listed in their application. Telephone numbers in the contact information need not correspond to the location of incorporation, she said. ICANN doesn't require registrars to publicly disclose their place of incorporation.

Directi's decision to sever its relationship with Estdomains was in part spurred by this article from Brian Krebs's Security Fix, which reported that the majority of websites that punted spam over the past year were registered through PrivacyProtect. Even prior to the article, Turakhia says Directi had already stopped providing hosting services for Estdomains.

Konstantin Poltev, the registry liaison for Estdomains, said the company is in the process of giving customers the choice of de-anonymizing themselves or transferring stewardship of their domain names to other registrars who offer the PrivacyProtect service.

He said he was surprised as anyone when he learned the extent of abuse of the PrivacyProtect. He characterized the termination of the service as a mutual decision between Estdomains and LogicBoxes and insists Estdomains has a zero tolerance policy for abusive domains it registers.

"We suspend all spam, all phishing, all fraud of any type," he said during a phone interview.

Perhaps, but it's worth noting that xpantivirus.com, which was registered using the Estdomains service, remains (at time of writing, anyway) up and running more than 10 days after we provided this detailed anatomy documenting the site's propagation of a diabolical piece of malware known as XP Antivirus 2008.

LogicBoxes is still contractually obligated to provide software support and additional services to Estdomains, but Turakhia says he looks forward to the day when he can completely sever ties with Estdomains.

"I would really love to detach ourselves from that organization," he said. "We'll have to let portions of that contract run out on its own." ®

Update

Within a few hours of this story being published, the xpantivirus.com site was removed. The link to report abusive domains to Estdomains is here.

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