Kim Dotcom addressed the New Zealand parliament's intelligence and security committee on Wednesday, as its government considers allowing the normally foreign-focused Government Communications Security Bureau (GCSB) to spy on citizens.
In a sometimes testy submission, Dotcom told the five-member committee expanding the government's spying powers that it was "morally indefensible".
Dotcom said he had the misfortune of being spied upon by the GCSB before his arrest last year. That was later revealed to be illegal as he is a New Zealand citizen.
"This abuse should never happen again," he said.
The United States is trying to extradite him to face charges over his Megaupload website, saying he made millions of dollars from pirated copies of films and television productions.
Key, the committee chairman, last year apologised to Dotcom, but on Wednesday Dotcom asked whether that could be considered a real apology if the prime minister now wants to legalise an illegality.
He said the GCSB is a subsidiary of the US National Security Agency (NSA) with the US calling the shots.
Dotcom urged New Zealand not to follow the US into the "dark ages of spying abuse", wherein the US has recently been exposed over the extent of its snooping on allies.
His US piracy charges against him are now "deeply ironic", he said.
"Privacy needs heroes just like the anti-nuclear movement needs heroes."
Dotcom also accused Key of being aware of what he was doing when he moved to Key's Helensville electorate, something that Key denied.
Key ended the session, despite efforts by Green Party leader Russel Norman to extend the submission.
"See you later, it's been fun," Key said.
Outside the hearing, Dotcom said he has proof that Key knew about him before last year's raid.