U.S.-Canada drug ring broken up

Late last year, Nathanael Lineham got a panicked phone call, prosecutors say.

An associate working with Lineham to bring the drug ecstasy to California from Canada told him a shipment of 85,000 pills had been seized. Lineham was calm. After all, the deals were struck using coded e-mails -- on encrypted BlackBerrys from Lineham’s own company.

What Lineham didn’t know was that law enforcement officials were recording the call. And that, for almost a year, they had intercepted dozens of e-mails from supposedly secure BlackBerrys.

Lineham, of Newport Beach, was just one player in an import-export drug-trafficking ring that brought ecstasy and marijuana to the U.S. from Canada and sent cocaine back across the border, prosecutors say.

The ring was broken up Tuesday after a two-year investigation by federal agencies that relied heavily on intercepted e-mails and recorded phone calls. The alleged phone call and other accusations against Lineham and 17 others were laid out in a pair of indictments filed late last year.

Lineham, founder of Datalocking Co. in Aliso Viejo, seemed to believe his method was foolproof.

According to the company’s website, Lineham has been working in telecommunications since 1989, when he founded a retail wireless and electronics store.

Four years ago, Lineham’s company developed a way to keep personal information on BlackBerrys secure, the site claims. The phones were marketed to individuals and companies looking to secure privacy.

Top-level executives need to be assured others aren’t privy to confidential content, Lineham told Fox News last month in an article on the privacy technology.

But Lineham also was marketing the devices to drug traffickers and using them in his own drug business, prosecutors said. Intercepted messages let investigators construct a detailed portrait of the operation, from the date and time of shipments to the type of container it was in.

The operation relied on an intricate network of smugglers and distributors to transport and disperse the drugs in Canada and the U.S., prosecutors said.

In addition to Lineham, prosecutors charged Jason I. Ming Wei, 30, a Canadian citizen who lives in Temple City, with overseeing the ring. He was arrested Sunday night at Los Angeles International Airport as he prepared to board a flight to Canada, said U.S. attorney’s spokesman Thom Mrozek.

The investigation, dubbed “Operation Candystore,” led to the seizure of money and drugs, including 60-kilogram and 35-kilogram shipments of cocaine. The 18 people implicated in the ring face a wide array of charges, including conspiracy to distribute and possess narcotics and money laundering.

In addition to Lineham and Wei, four others were arrested Tuesday. The other domestic defendants were being sought by authorities.

Officials said they will file provisional arrest warrants against the Canadian defendants in the next few days.

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paloma.esquivel@latimes.com