Canadian tech entrepreneur extradited to France over EncroChat encrypted phone network

Paul Krusky, from Waterloo, Ont., faces charges including drug trafficking and money laundering tied to the EncroChat encrypted phone service used by criminal networks across Europe.

Ontario man sent to France as key accused in EncroChat criminal enterprise case

Paul Krusky, a low-profile tech entrepreneur from Waterloo, Ont., was extradited to France earlier this year after being identified as one of the key figures behind EncroChat — an encrypted phone service that European law enforcement agencies say served tens of thousands of criminals, including drug traffickers, hit men and organized crime groups. The Globe and Mail reports that a French public prosecutor announced on Feb. 5 that Krusky was now in French custody, describing him as one of the key leaders behind the platform.

Krusky, a clean-cut man in his early 50s, had been living in the Dominican Republic with his wife, Diana Fantuz, in a gated community on the island's north coast. The couple had relocated there from Ontario years earlier, settling in a town popular with expats for its beaches, restaurants and relaxed lifestyle. Fantuz volunteered with a local stray-dog rescue organization, and the couple kept several dogs at home despite Krusky's allergies, according to posts she made on Facebook.

According to a friend — one of 14 people who spoke to The Globe and Mail, most requesting anonymity due to concerns about discussing a criminal case — Krusky preferred dogs to people and largely kept to himself. He always had projects underway: building websites, working on a faster Amazon shipping solution for the island, attempting to design a new type of fly trap. He told one local resident he earned money through online gambling. His actual most lucrative venture, however, was something he discussed with no one.

Arrest at a restaurant, then extradition

In May 2022, Krusky was arrested in front of his family at a local restaurant where he and Fantuz had been dining with his parents when police moved in. He was subsequently held in a prison in Santo Domingo, the Dominican capital, while French authorities pursued extradition. A judicial record from the Dominican Republic shows the charges he faced: participation in drug trafficking, aggravated money laundering, aiding organized crime, possession of firearms, and supplying unauthorized cryptographic devices.

Krusky was eventually released to house arrest while the Dominican court deliberated on the extradition request. During that period, he trained at the gated community's gym. One night earlier this year, police entered the gym and informed a personal trainer they were looking for someone — the court had ruled in France's favour. Krusky was apprehended and transferred to France.

His French lawyer, Antoine Vey, says Krusky denies all the charges, none of which have been proven in court.

What EncroChat was, and who used it

French police first took notice of EncroChat several years ago when they observed a pattern: many individuals arrested with ties to organized crime were carrying the same type of specialized smartphone. The devices were modified Android handsets running the EncroChat software platform, available through an online reseller network for roughly €1,000 each, with a six-month subscription — including round-the-clock support — costing an additional €1,500.

By 2018, resellers were operating across Europe and Canada. One reseller, operating under the name RodTele and claiming to be based in Vancouver, identified itself as the master franchisor for EncroChat in Latin America, including in Mexico's Sinaloa province, home to a prominent drug cartel.

EncroChat marketed itself as offering "the next level of worry-free secure communications." Messages were encrypted end-to-end, GPS functionality had been removed from the devices, and there was no mechanism to link a specific device or SIM card to a customer account. Users could switch between a standard-looking Android interface and EncroChat's own platform. A "panic wipe" feature allowed users to enter a code to delete all messages instantly; resellers could also trigger a remote wipe. The service had accumulated more than 60,000 users within a few years.

The U.K.'s National Crime Agency has stated there was no legitimate reason for anyone to own an EncroChat device, given that the platform's customer base was overwhelmingly composed of criminals co-ordinating drug shipments, murders and other illegal schemes while evading detection.

A contested legal and technological frontier

Encrypted communication services occupy complex legal and ethical territory. Secure messaging can serve legitimate purposes — enabling people living under authoritarian governments to communicate freely, for instance. But the same technology can be used to facilitate serious crime.

European authorities have characterized services like EncroChat as "grey infrastructure": systems that are resistant to conventional investigative methods such as wiretapping and that may refuse to co-operate with law enforcement. The argument advanced by prosecutors is that while not every user of such a service is necessarily a criminal, the density of criminal activity associated with EncroChat was sufficiently high to render the company itself a criminal enterprise.

The French Gendarmerie Nationale opened a formal investigation into EncroChat, ultimately resulting in a major operation targeting the network. Krusky now stands at the centre of that investigation, accused of playing a leadership role in building and maintaining the infrastructure that, according to French prosecutors, enabled criminal networks across Europe and beyond to operate with a degree of technological impunity.

All charges against him remain unproven.

Source: The Globe and Mail