Former ICANN CEO is now co-CEO of the private equity firm that tried to buy .org | Hacker News Reader

Former ICANN CEO is now co-CEO of the private equity firm that tried to buy .org

domainnamewire.com

989 pointsfeross135 comments

In today's Slate Money podcast they interview Margret Sullivan on her new book about destruction of US local newspapers.

She has an interesting factoid - those local governments with local newspapers have significantly and demonstrably lower costs of borrowing than those without - the conjecture being that over the years councils have been unable to get away with blatant corruption for fear of public humiliation- that the "watchdog" role of newspapers is not nice journalist ethics but actually measurable in tax dollars

ICANN is part of the Internet's local government and we need to find new ways to keep watchdogs alive.

[#] https://podcasts.apple.com/gb/podcast/slate-money/id87652388...

Random info - a factoid originally meant "a piece of information that becomes accepted as a fact even though it is not actually true", when it was coined a few decades ago.

https://en.wikipedia.org/wiki/Factoid

Of course, like "Literally" & "Decimated", the accepting meaning has drifted since then...

Weird that wiki doesn’t mention that it’s just the -oid suffix for “like” the same way we can call a non-square box a cuboid. The rest seems suspect eg anyone could’ve coined it.

Well, almost anyone. If the Progenitors had been startup devs we'd probably be approximately spherical meeple in a webgl tarski's world with "facty" and "fucky" truth values.

for 'decimated' are you talking about the change from 1 in 10, or something more recent I missed ?

"Literally" is literally my biggest pet peeve. Changing from 2 spaces to 1 at the end of sentences is another.

1 space after a period has always been correct unless you’re writing in a monospaced font (or with a typewriter).

exactly - 2 spaces was correct for anyone that learned to type before say y2k. Back when typing actually involved a typewriter :-)

How has decimated changed in meaning?

Decimated comes from the Roman military punishment "Decimation" where for some military unit being punished, 10% of their ranks were to executed by their colleagues.

The most literal meaning of decimated is "to reduce by 10%" but the common meaning is from the complete and total destruction of morale and resistance that results from being forced to kill your colleagues.

If you told the average American "We decimated the Iraqi army" they'd think America wiped them out entirely. Or at least 50%.

Which is why the modern 1st definition is:

> "kill, destroy, or remove a large percentage or part of."

The amazing thing is the ICANN tried to frame the decision to shelve the .org sale as a decision that they initiated, when it was only after numerous organizations like the EFF and even the California Attorney General steppes in that they did anything.

A less creative interpretation would be that ICANN was asked to approve the purchase because the .org contract required it. ICANN called for feedback on whether it should approve, and many in response made their position very clear like the EFF, which lead to the rejection of the request.

Who stood to benefit from the sale?

Internet Society (ISOC) was the one selling, and said the money would create an endowment to fund their work.

That was just the cover (and a blatantly thin one at that); the real beneficiary would be the purchaser, which was buying what could easily be turned into a highly lucrative business for peanuts.

I guess I never really understood how. Are TLDs really worth that much income? Why would somebody choose .org instead of .com or their local TLD? Would they have tried to monetize by undercutting .com?

.org is among the cheap TLDs and widely used. If you want to make money from it, you jack up the prices and now many long-term established organisations using an .org domain now have to pay you more or have to give up their domain and find a new one, with all the follow up costs and consequences. People just now looking for a domain are fine, the ones committed to a name have an issue.

Interesting fact: The three largest investors in Ethos Capital are the investment vehicles of three families of billionaires: the Romneys, the Perots and the Johnsons.

'So long as we have monarchy in the factory, we cannot have the republic in society' —Marc Sangnier

Love it, thanks!

It reminds me of a thought why you can’t bring democracy into a country by invading it - because democracy doesn’t exist in a vacuum and therefore voting is done not only during elections, but also with you wallet and ability to switch jobs easily.

> ability to switch jobs easily

that's a funny way to write 'willingness to act collectively with fellow workers'

A little off topic but what boggles my mind is seemingly everybody supports "equal pay for equal work" but nobody seems to support the idea that all salary/bonus/non-monetary compensation for everyone within a company should be freely accessible to everyone including contractors and seasonal workers within the company. This is so obvious to me as a first step in actual pay equity. How can we have pay equity without transparency?

I believe it's the "equal work" bit that makes that a problem. I think I work harder than some of my coworkers and should therefore make more. Who decides what equal work is?

I'm happier not knowing

Not to be daft, but I can't imagine a single reason this is better for you career or labor organization-wise. If anything, it strikes me like that old quote:

Benjamin Franklin said: "Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety."

Not knowing the wages of those around you makes collective organization and bartering harder which is bad for workers in aggregate.

I agree but because I don't think those at the top would ever let the transparency be complete. Unless the company was started that way and managed to keep it while growing. Which experience seems to show is hard or unlikely.

It is a fallacy to believe that public information about a non corporal entity would help establish fairness. All corporations operate under the act of blame and judgement to increase profits, or they simply cease to be.

Is that fallacy also true for cooperatives?

An alternative to the total transparency you call for might be that an auditor examines everyone’s compensation, and provides statistics for each job role. Lots of employees prefer not to have their exact compensation revealed. Sometimes you may work well with someone (a lawyer, say) and think him a good team player, until you realize he is making tons more than you and envy becomes a factor. Your attitude might go from positive to negative. Would salary transparency be good in that case?

> Sometimes you may work well with someone (a lawyer, say) and think him a good team player, until you realize he is making tons more than you and envy becomes a factor. Your attitude might go from positive to negative. Would salary transparency be good in that case?

It isn't me against the other lawyer. It is me AND the other lawyer against the company. Remember, the company has full vision into everyone's compensation.

I remember this one joke about a survey of drivers where over 80% (? I forget the exact number. It is a joke iirc.) of drivers rated themselves at least at "over average" or better. Similarly, I suspect a lot of employees think they are "smart negotiators". Nothing can be farther from the truth.

I had a coworker who made about USD 80k a year and he was very opposed to raising the minimum wage in New York. He was open about why he opposed it. He thought his wages will not increase as minimum wage increased and that the increase in minimum wage will cause his rent to go up. You may hate him but at least he is honest.

I'd eventually like all compensation information for everyone to be public but I understand that is a tough sell. I think if you support pay equity, you must support transparency within the organization.

> Lots of employees prefer not to have their exact compensation revealed.

In fact, I am pretty confident (no proof though) that many for-profit companies as well as non-profits (including Research Foundation of the City University of New York) share this information with third parties such as Equifax or Intuit (makers of TurboTax).

All this information is already out there. We are just one more data breach away from having this information leaked.

What do you mean?

I mean that if your employer is for example, a monopoly in a relatively stable-yet-poor-country, the rational vote is to always vote for the preservation of your existence (ie the preservation of your job rather than de-monopolisation of the market) and thus it’s really hard to transform the country even if the voting is inherently fair.

Are there any examples of people voting strategically and getting what they want? Because the way I see it - strategic voting is almost always a populist vote and thus is rarely rational.

I think the parent poster is poking fun at the common "libertarian"/"meritocracy" techbro-speak about why we supposedly don't need tech unions.

Do you mean like a family office, or like they all invest in Blackrock index funds?

How much are you willing to bet they don't even know that's one of their thousands of investment vehicles?

This one involved strategic executive shuffling, secretive organization policy changes, shell companies, and over a billion dollars initial investment. They were probably right in the middle of it. Especially considering the thing they were buying for $1B is likely actually worth $2B+.

The crazy thing is that this is probably all within the confines of the law.

Unfortunately, a three tiered government means the law is written by congress, not by the people who see the injustice of the law and want to fix it =(

Citation?

https://medium.com/savedotorg/whos-going-to-run-org-in-a-wor...?

I'm sorry but a blog post about "a screenshot of an email" doesn't do it for me.

Can you do better?

(I can't even see the screenshot because I don't enable JS so it's just a blurry thumbnail image. Oh how I wish people didn't use JS to serve static content!)

This is what Ralph Nader would call a "deferred bribe".

Can you please explain this comment?

It means he was bribed (the new job) to help with a transaction (sell .org), but to not raise suspicion the bribe delivery was scheduled for a later date.

Ok but he wasn’t able to sell .org, so why did he still get the job?

Because I bet this isn't shelved for long, just long enough for the public to forget.

Not to mention, unexpected hurdles (the pesky public) got in the way.

He did his part, and should be compensated... at least, that could be the logic.

It tells the next guy they will try to bribe that they follow through on their promises.

Or maybe it's a way of keeping him quiet about what actually happened. The co-CEO title certainly sounds like an honorarium.

because being part of the conspiracy he's become a liability ?

They used to say about a well known Irish politician that he always took the bribe but never did what he was bribed to do. But people kept bribing him anyway.

It's core business to every politician so you can leave Irish out.

Well perhaps but I tend to focus on the local

Nassim Taleb talks about this revolving door between government and business.

After a powerful regulator leaves government, they can often get high paying jobs in the industry they just regulated as a reward for good behavior and to interpret the complicated regulations.

This is widely practiced in politics (globally) in my country former presidents build non-profits (or "institutes") to receive these bribes in the form of donations.

Non-profits are also a popular legal bribe delivery vehicle here in the US

it seems more likely the original bribe/shady business failed, and now they've hired him for his internal connections to help with future shady deals

If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck.

If it looks like corruption... it probably is.

This guy should be in jail, for attempted fraud and breach of fiduciary duty... Just because he didn't succeed, it doesn't mean he didn't commit a crime.

Yeah, I don't think the situation is too complicated. Fadi Chehadé used his position as ICANN's CEO to try to complete a transaction that would enrich himself and make the public poorer. Now he's counting on the public to ignore that he tried to do this, or at least not prosecute him for it, and he's probably right. I wouldn't be surprised if Fadi to was invited to the White House as a special adviser on the internet, or something like that.

>>> I wouldn't be surprised if Fadi to was invited to the White House as a special adviser on the internet, or something like that.

Yep, such behaviour is pretty much a qualification for joining the U.S. government.

"Fadi, you've been doing outstanding work! This is the sort of skills we need on the team. Would you like to run the Department of Defence?"

Dont confuse this administration for the "US Government"there has always been graft, but it has NEVER been like it is right now.

It will certainly go away if $CHOICE is elected.

https://youtu.be/UDfAdHBtK_Q?t=476

Just because two things stink to high heaven, it doesn't preclude the possibility that one thing smells more than the other.

Would you rather eat this pile of poop or the other pile of poop is not a decision I want to make.

The government is just another crew

Doin whatever they want to do

It has ALWAYS been like it is right now. The only difference is the current administration doesn't care as much about hiding it.

This administration is very much about making things transparent.

Which is why this is the first President in US history, since the formation of the income tax, to not release his tax returns, right?

It bothers me quite a lot that the present and the future of the DNS a d so much of the internet infrastructure (effectively e global public service) is in the hands of the United States of America.

What other country has stronger protections for free speech?

Actually, ICANN was privatized away from US government in 2016.

https://finance.yahoo.com/news/u-government-no-longer-contro... https://en.wikipedia.org/wiki/ICANN

Despite that, I can imagine New York launching a case.

> Fadi Chehadé used his position as ICANN's CEO to try to complete a transaction that would enrich himself and make the public poorer.

The .org deal was initiated 3 years after he left the position of ICANN CEO.

That’s just enough years to build the necessary network of people who would trust you to follow you with this idea and to make a fake excuse of not having enough power to affect ICANN’s decision making.

Wouldn’t be surprised as well if the guy hadn’t even given it a second thought since that makes you sleep better.

It looks like corruption, it probably is corruption, and I bet you my bottom dollar nothing ever comes of it.

To send someone down for something like this you basically need a note written in the defendant’s own blood saying “I am deliberately and knowingly carrying out corrupt deeds which are prohibited by the law”, and even that would probably be seen as weak evidence. Hell, a videotape of them discussing how to be corrupt, how they will profit from it, how to launder the money would not be enough. It hasn’t been in prior cases of this type, where they’ve got as far as someone looking at them.

There’s practically no recourse for this kind of crime. It’s a wonder to me that more people don’t embezzle and defraud, given that the chances of facing any consequences seem to be practically zero.

I cast my mind back to working for a large brokerage in 2005, and them hiding nearly $500m in losses through accounting fraud for years on end, and eventually rinsing investors for a few $bn. EVERYBODY knew about it - pretty much down to the mail room guys. The entire upper echelon of the company were in on the scam. The CEO went to jail because he threatened to squeal on the guys at the SEC who had turned a blind eye (the things people will do for a nice meal out and season tickets) until a whistleblower ruined the party.

As far as I can tell the only time people face prosecution for fraud and what have you is when they are small, unconnected people. You know, life in jail for $20 out of the register, summary execution for standing funny. Well, either that or connected people who lost their protection or failed to give the right politician a bribe.

Steal a public utility? Welcome to government, my friend.

It sounds really implausible that one can bribe a SEC auditor with a dinner.

Yeah, that’s why it works. Even the auditor doesn’t necessarily realise they’ve been bought. You’re just going to choose to not look at this particular odd set of loans because you don’t want to create a problem for Philip, he’s such a gentleman, and you’re sure there’s nothing untowards there. Plus your son in law works for one of the group companies, so there’s that.

Most corruption doesn’t happen due to money changing hands, but due to misplaced personal loyalty, and reality being less seemingly plausible than fiction.

> Hell, a videotape of them discussing how to be corrupt, how they will profit from it, how to launder the money would not be enough. It hasn’t been in prior cases of this type, where they’ve got as far as someone looking at them.

Can you provide any example to back up this claim?

What was his duty and is it recognized by law? Who would prosecute him?

What would happen if browsers just decided to make their own name service? Does icann have some sort of protection on domain names? Given that we already use Google or cloudflare DNS, why not just make a competing nameservice and throw icann to the curb?

Please don’t give storm any ideas

Browsers are just small part of the Internet , we already use lot of internet outside the browser in the form of apps , email etc .

Some people know and can use chose their DNS , many have to rely whatever dns their ISP or corporate IT provides . Very hard to move all that to common new standard

Browsers esp chrome/safari as it is modify the URL way more than I am comfortable with .

As bad as ICANN is I really don’t want Apple and google dictating how dns should run

They are.

1. HandyBrowser (supports handhshake): https://github.com/HandyMiner/HandyBrowser

2. TorBrowser: https://www.torproject.org/

3. Opera: https://unstoppabledomains.com/opera

4. Status.im: https://status.im/

5. Brave: https://brave.com/

6. Unstoppable: https://unstoppabledomains.com/browser

7. Blockstack: https://blockstack.org/install

Probably few more - maybe dozens.

For major DNS providers, nextdns supports handshake.

0] https://handshake.org/

1] https://nextdns.io/

These are namespaces with their own browsers, not browsers with their own namespaces

What if people used a de facto whitelist of IP addresses locally mapped to names in, for example, /etc/hosts? This is how the internet worked in its earliest days, after all. I'm not saying this is a good idea, but it's interesting because it also serves the interest of Google and Facebook, so they might promote the technique. Since people will only be able to see content from a small portion of the internet (the part they have in their local file), and would give content hosted by the big players a huge advantage. It would also have the interesting effect of making "raw IP" addresses more visible, and special, easily remembered IPv4 addresses more valuable!

This does not sound like an improvement over the status quo to me.

You want to go back to 90's?

The 80s

I wouldn't say it serves the interest of Google, because then you couldn't get to all the websites linked from Google Search.

That's fine, Google rehosts them all on AMP anyway and often people don't even click through past the search results page.

All you would get would be buttons that downloaded applications who would add a line in your host file when run.

You lose so much without DNS where each site/service controls their own domain.

Consider modern hosting: Load balancers, CDNs, etc all configured and deployed on-demand, with the IPs changing as frequently as the provider likes.

Sure, Amazon lets you get static IPs.. but now I want to re-point traffic at another region because this region is failing, or down for maintenance... sorry, no, can't do that.

Anyone doing even moderate amount of hosting/whitelabelling doesn't have anywhere the IPs they need.

It's silly to talk about this as if we'd throw out dns entirely...

To address the original concern, all we'd have to do is throw out the ICANN root and replace it with a root controlled by a new NOTICANN organization. People were already talking about this when the .org debacle was still playing out.

It might even be healthy for the internet to do this every so often as a warning to those who would dare to try something like this again. They serve at our pleasure.

We're all just agreeing to use their root for convenience. As soon as it stops being convenient, we can literally just decide to give it to someone else.

Answer to Q1: Don't care. Software that does not honour /etc/resolv.conf is a PITA.

Answer to Q2: No. They have mass cooperation from network admins and DNS software authors to use ICANN roots.

Answer to Q3: Go for it. I have been running a non-ICANN root for myself over 20 years.

Wasn't Tor's .onion basically separate from ICANN until 2015?

Well, there's OpenNIC — https://www.opennic.org

There is a lesson here, brought to you by Ethos Capital....

“The secret of success in life is for a man to be ready for his opportunity when it comes.”

- Benjamin Disraeli

Speaking of .Org and ICANN. If any one in the industry knows what happened to .Web?

I think Verisign won the action and then the other two bidder decided to sue ICANN. But that was 2017/8.

Is this foreshadowing?

This is why projects like Handshake exist[1]. It’s a DNS protocol that aims to replace CAs and decentralize the governance of TLDs as well.

[1] https://handshake.org

It's rather amazing he listed his own name for EthosCapital.org. A poorly orchestrated attempt at a crime against knowledge.

At least it’s an ethos…

(Sorry, couldn’t resist.)

[Edit: Gah, 'viburnum beat me to it: https://news.ycombinator.com/item?id=23878691]

What a lousy bribe! I’m sure some money changed hands as a signing bonus or something but if I’m running a scam I don’t want to have to pretend to be an executive afterwards!

Co-CEO, like a boat with two captains. Full four-bars right away would have been too obvious.

The guy's history is ripe with backroom deals. Look at all the "acquisitions" he's been involved with.

Who wants to update the wikipedia article for this honorable gentleman?

“Ethos” Capital?

As in “at least it’s an ethos.”

so far we have what appears to me, to be a series of victimless crimes

"Your honour, I just dropped in to see what condition my condition was in."

The point is their victimlessness is contingent on the failure to go through.

Had it gone through, it would most certainly not be victimless. Furthermore, try getting off of a speeding ticket by telling the Judge it's a victimless crime because you didn't crash into anything this time.

I'm sure it will put them is a state of mirth and good spirits.

You're right, but the comment you've responded to is quoting The Big Lebowski.

The Alan Blinder problem https://en.wikipedia.org/wiki/Antifragile#The_Alan_Blinder_p...

I'm open to suggestions for FadiChehade.org.

Single page with an image of a bag of dirt.

Fadi Chehadé was CEO until March 15, 2016. Ethos Capital was founded in May of 2019, 3 years after he stopped being CEO of ICANN.

After following KnuJoN nothing would surprise me with ICANN unless it was good. It needs to die and everything it has touched moved somewhere else that cannot be manipulated like it is now and out of reach of the US.

Paul Vixie talks about DNS: https://www.youtube.com/watch?v=ZxTdEEuyxHU

This... isn't news? He was already involved with Ethos Capital from the start of the .org debacle, which was one of the problems people flagged.

If you read the article, it states that his name was not on the Ethos site, and it only inadvertently leaked into the public discourse because of some whois data. The news in this article is that Ethos has now formally updated its website to acknowledge him as co-CEO.

This is clearly the worst form of corruption. I would be surprised if there are not Federal or state laws which might nail these people.

No consequences so they don't even try to hide it..

He was ICANN CEO at the time of the attempted purchase?

“Chief Purpose Officer”. What a cheap joke...

Power abuse.

Good to know

But ICANN denied the org transaction. What's the problem with the former CEO joining that PE firm?

Due to massive pressure from governments and NGOs, not because it was wrong. If they could have gotten away with it, they would have.

OK, so what's the problem?

Who said there was a problem? We had certain priors on corruption and contested the .org sale on the grounds that these guys were corrupt. We pushed for the California AG to investigate ICANN and they did on the grounds that these guys were corrupt. Turns out they were corrupt.

This is just the loop being closed. Our posterior probability of corruption rises only a very little bit because most people observing and participating kinda expected this.

Attempted Fraud..

If a child is caught trying to steal from the cookie jar, you don't just let them off because no cookie was actually stolen?

The problem is that the root issue of ICANN corruption hasn’t gone away. So there will be more problems in the future, you can count on it.

There are initiatives like https://handshake.org that are trying to do away with ICANN entirely

He was bribed to sell off .org to venture capitalists.

a guy tries to kill you and your family. the policr stop him. i guess we let him go free, since you don't see a problem. this just applirs to you though. cool?

I'd prefer to use another analogy.

The head of the US National Parks Service decides to sell off Yellowstone(1) to a property development company. Massive outrage ensues, and the guy quits to become CEO of that same Property Development Company.

While those two things in and of themselves might not be unlawful, it certainly sounds awful fishy. It might be worth investigating if there was some kind of breach of the law.

(1) I know NPS doesn't own Yellowstone. It's an analogy, roll with it.

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