Firm stops file sharing after Megaupload case

(Reuters) - FileSonic, a website providing online data storage, has disabled its file sharing services following a U.S.-led crackdown on a rival website and amid heated debate over Washington's attempts to clamp down on online piracy.

Police in New Zealand and Europe have made a number of arrests in recent days related to an investigation led by the U.S. Federal Bureau of Investigation of the Megaupload.com website.

The group have been accused of engaging in a scheme that took more than $500 million away from copyright holders and generated over $175 million in proceeds from subscriptions and advertising. Megaupload's lawyers have said the company simply offered online storage.

FileSonic, which describes itself as the "Unlimited Storage Company," said in a statement on its website that it would only allow users to access their own files.

"All sharing functionality of FileSonic is now disabled. Our service can only be used to upload and retrieve files that you have uploaded personally."

The firm, which lists addresses in Britain and Hong Kong, did not immediately respond to an email sent requesting further comment on the move.

The Megaupload case is being heard as the debate over online piracy reaches fever pitch in Washington where Congress is trying to craft tougher legislation.

(Reporting by Ed Davies in Sydney; Editing by Alex Richardson)

[Image via Shutterstock.com.]

Mochila insert follows ...