November 2004 - cypherpunks-legacy

Terror Net
by R.A. Hettinga 19 Nov '04

19 Nov '04

-----BEGIN PGP SIGNED MESSAGE----- Hash: SHA1 <http://www.technologyreview.com/articles/04/12/innovation31204.asp?p=0> Technology Review Terror Net By Lakshmi Sandhana Innovation News December 2004 Ever since the September 11 terrorist attacks, federal agencies have been wishing for a system capable of issuing a nationwide alert at the first sign of a chemical, biological, or radiological attack. Now such a system is undergoing trials in Tennessee. Developed by the U.S. Department of Energy's Oak Ridge National Laboratory in Tennessee, the new system consists of sensor packages attached to structures such as cell-phone towers. The packages will include detectors for airborne chemicals and radioisotopes, and for weather changes. The intent of the system-which is being tested in Knoxville, Nashville, and other locations-is to detect plumes of contaminants, predict their spread, and quickly alert command centers. In a 2002 test, prototype sensors successfully detected discharges of simulated sarin gas in three cities 140 to 270 kilometers apart and dispatched pertinent data in less than two minutes. The current trial will test the system on an even larger scale. The Department of Defense, the Department of Homeland Security, and other organizations are sharing the cost of developing the system; at least $12 million has been assigned to it for the coming year. "At this point, we are not deployed nationwide, but we've demonstrated the scalability of the technology," says Jim Kulesz, special-projects manager at Oak Ridge. Observers say the technology, while promising, is not a panacea. If fully deployed, says Paul Sereiko, president of Needham, MA-based wireless-sensor maker Sensicast Systems, it "will provide an excellent early-warning system for wide-area contaminant monitoring." But, he adds, additional local monitoring will still be needed. - -- - ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' -----BEGIN PGP SIGNATURE----- Version: 1308 iQA/AwUBQZ4H8MPxH8jf3ohaEQL1AACgw+u/d4omwYlLZm5sPVUqhAyG8tgAoOma TC/hiEwOHODVP/IxN7TfzKn1 =2c0B -----END PGP SIGNATURE-----

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Tax inspector's quest in 'The Cryptographer'
by R.A. Hettinga 19 Nov '04

19 Nov '04

-----BEGIN PGP SIGNED MESSAGE----- Hash: SHA1 <http://thestar.com.my/lifestyle/story.asp?file=/2004/11/19/features/9295722…> The Star Online: Lifestyle Friday November 19, 2004 Tax inspector's quest in 'The Cryptographer' Review by JOANN KOH The Cryptographer Author: Tobias Hill Publisher: Faber and Faber If cryptography is the science of concealing something, such as "the blueprint of a gun in a conversation about snow", then Tobias Hill himself must be an expert cryptographer. If he had meant to be so, that is. This book is full of brilliant insights - but I had to dig for each nugget, because he is not always clear. Or direct. But perhaps it is because Hill is good at getting under his characters' skin (he won the 1998 PEN/MacMillan Award for Fiction for his debut novel, Skin). Then again, perhaps he is too good. In the book, the protagonist Anna Moore, tax inspector A2 grade of Her Majesty's Inland Revenue Service, is paid to doubt what her "client" says (client being a euphemism for those we must investigate), and Anna Moore doubts plenty. In trying to show us how the mind trips up when doubting, Hill may have caused us to stumble, too. It is quite an exercise of tenacity, by page 20, to reread what Anna says or doesn't say - to make sure what Anna says, or doesn't say, is what Anna means exactly. But then again, this is stream-of-consciousness writing, and novels with ambiguity of this level do not sit well with me. That said, however, if you enjoy ideas and feel up to a challenge, this novel could be for you. It is the year 2021, when Soft Gold, an unbreakable form of electric money has replaced paper money. Anna is assigned to investigate John Law, cybergenius, cryptographer and inventor of Soft Gold, for an undeclared sum of four million dollars in an account in his son's name - a surprising sum to be secret about for a quadrillionaire. For Anna - who believes that after a certain point, we begin chasing money not for money's own sake, but for the love of someone we have, someone we want or hope to be - this is the beginning of an obsession. Anna wants to know whom John Law thinks of, when he thinks of money. In this invented world, the future belongs to John Law. But the world of the future fears him as much as they respect him. For a man who knows how to embed "encrypted information in the genetic code of plants and flowers", (the patent of which, at age 17, he sold to the US government for seven and a half million dollars) may also embed a deadly virus in our bodies should he wish to quietly exterminate us. A man with so much wealth can vacuum his gut ever so frequently and outlive us - a demigod amongst mortals. And so on and so forth. Law creates the downloadable Soft Gold freeware, which he guarantees is totally secure because no computer has yet been invented that can break the code. But he also knows it is human nature to want to break an unbreakable code, for by breaking it, not only does one discover its defects, one also exceeds its inventor. So, it is just a matter of time when Soft Gold gets broken into and John Law becomes a hunted man. This time, Anna is assigned to hunt him down. Concealed within are two love stories, involving old loves Anna and Lawrence and new loves Anna and John. Lawrence waits patiently to re-ignite a stalled relationship, but Anna feels she no longer loves him; she has betrayed his trust, once; she feels she trusts him though. But she doesn't know if she can trust John Law, although she wants to; the second pursuit, on a personal level, is for her to find out if she can. Because without trust, she knows, love will not be possible. Read The Cryptographer for the thinker in you, and not the "feeler". And welcome to the invented world of Tobias Hill. - -- - ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' -----BEGIN PGP SIGNATURE----- Version: 1308 iQA/AwUBQZ3sRsPxH8jf3ohaEQKAbQCdGIemIF+TWyd0UMIBMIcXHqbjNbsAn0lr MhB9HFVzSPb1hODcURwLubGk =ypcr -----END PGP SIGNATURE-----

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Pioneer of Sham Tax Havens Sits Down for Pre-Jail Chat
by R.A. Hettinga 19 Nov '04

19 Nov '04

-----BEGIN PGP SIGNED MESSAGE----- Hash: SHA1 <http://www.nytimes.com/2004/11/18/business/18tax.html?th=&oref=login&pagewa…> The New York Times November 18, 2004 Pioneer of Sham Tax Havens Sits Down for Pre-Jail Chat By DAVID CAY JOHNSTON EATTLE, Nov. 17 - Jerome Schneider, the nation's best-known seller of fraudulent offshore banks, said in an interview today that he had helped hundreds of rich Americans evade taxes, including actors, celebrities and business owners. Mr. Schneider, who pleaded guilty in February to conspiring to help his clients evade the tax laws, said that he expected "every single one" of his clients to be prosecuted or sued for the taxes they evaded. He said clients sought to evade taxes on incomes ranging from $100,000 to $40 million, though most were from a third to half a million dollars. Mr. Schneider, 53, spoke in a cramped hotel room here under the watchful eye of three Internal Revenue Service criminal investigators, who said nothing but smiled broadly at times as he answered questions and named clients and associates. The I.R.S. set up the interview with Mr. Schneider but did not interfere with it. The agency, by law, cannot comment on individual taxpayers. Under the terms of his agreement with the government to plead guilty, Mr. Schneider may not make any public comments about his former clients "without prior consent of the government." He is to be sentenced on Monday in Federal District Court in Los Angeles. In return for his cooperation, he is expected to serve no more than 24 months in prison. He has already paid $100,000 in restitution. Mr. Schneider said he always reported his full income to the I.R.S. and never personally used an offshore bank to hide income. Since 1976, Mr. Schneider has set up sham banks for clients in the Cayman Islands, Grenada, Montserratt, Vanuatu, the Cook Islands and, recently, in Nauru, a Pacific island. Clients paid as much as $60,000 to "acquire" an offshore bank, which consisted of nothing more than pieces of paper to create the appearance of legitimate business activity, he said, confirming the accusations in the government indictment. He said that while most clients wanted to hide money from the I.R.S., some also wanted to conceal money from estranged spouses or creditors. "Every one of my clients knew full well what they were getting into, including the potential to be prosecuted," he said, detailing how they signed contracts, were advised by lawyers and were told that if tax authorities ever caught onto them they could go to prison. "They understood that," he contended. He said that all his clients had two things in common - they were rich and they wanted to escape taxes. Most of the nation's major accounting firms worked with one or another of his clients, he said, and he named two law firms that he said were central to his business. He said one prominent actress sent money to the United International Bank in Nauru, which he said he created. He said the actress paid $50,000 for a legal opinion asserting that the arrangement was legal. Mr. Schneider also said that in 1988 he arranged for a prominent motivation coach to place $250,000 in an offshore bank without reporting the money to the I.R.S. In addition, Mr. Schneider said that a billionaire media businessman, one of several clients who he said were on the Forbes 400 list of the wealthiest Americans, sent $40 million to a sham bank in Nauru to pay for a nut-processing company in 1994. The owner of the company has died, but his estate is challenging in Tax Court an I.R.S. demand that taxes be paid on profits from the sale. For 28 years, Mr. Schneider promoted offshore tax schemes. He sold, he said, more than a million copies of his book, "The Complete Guide to Offshore Money Havens," which he advertised in The Wall Street Journal and SkyMall, a magazine found in the seat-back pocket on many airlines. The 2000 edition book carried an endorsement by Representative Billy Tauzin, the Louisiana Republican, who also spoke at one of Mr. Schneider's tax evasion conferences. Mr. Tauzin's spokesman, Ken Johnson, said the endorsement was "a stupid mistake." Mr. Schneider, 53, who lives in Vancouver, British Columbia, was the picture of a successful businessman, dressed in a knit shirt, gray wool slacks and black loafers, his graying hair clipped short, his face framed by horn-rimmed glasses. He began the interview by describing his conduct in terms of helping people, but when pressed he said, "Yes, I am a criminal." Mr. Schneider said his undoing began the day more than a decade ago when he asked Jack Blum, a former United States Senate investigator, to speak at one of his offshore seminars. Mr. Blum, who specializes in exposing international financial crimes, wrote a letter to the Justice Department that prompted the investigation that led to Mr. Schneider's guilty plea. Mr. Blum said, "That Schneider could operate openly for years, buying ads in the Wall Street Journal and the American Airlines flight magazine, shows the utter failure of tax law enforcement." He said law enforcement had known about Mr. Schneider for years, but failed to act. The Senate Permanent Investigations subcommittee called Mr. Schneider as a witness in 1983 hearings on offshore tax evasion, and two years later the Comptroller of the Currency warned American banks about dealing with some of the offshore banks Mr. Schneider created. The I.R.S., in court papers, said it began investigating Mr. Schneider in 1997, 14 years after his Senate testimony, because of the letter from Mr. Blum. It took five more years to obtain an indictment. Today, Mr. Schneider said, he is broke. "I lost everything,'' he said. "My wife divorced me and with the legal fees, everything is gone." Asked about the millions of dollars he earned setting up offshore banks, he replied, "It is gone, all gone." Since he has held himself up as the world's leading expert on hiding money offshore, how could one know for sure if Mr. Schneider really is broke? The I.R.S. agents listening to the question put their hands to their mouths to repress grins. "If you can find it," Mr. Schneider said, "I would say take it." - -- - ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' -----BEGIN PGP SIGNATURE----- Version: 1308 iQA/AwUBQZ3lLcPxH8jf3ohaEQI47QCg7oEB+XrObKioXntUJDtLy2IgJfsAoJoq mOcArd6Jsqcn21vAKSQhyUbW =mj7W -----END PGP SIGNATURE-----

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Re: Why Americans Hate Dissenters
by Nomen Nescio 19 Nov '04

19 Nov '04

John Young: > On CJ (Carl Johnson) and Jim Bell: Hi John Thanks for the info! Several times in the past I've seen concrete relevant questions asked on the list without anyone taking their time to answer them. The stories of these cypherpunks are indeed interesting and relevant for the list. I guess the story of Jim and CJ is the reason why one of the cypherpunks nodes used to have this text on the page: "It is known this list is under surveillence by US and foreign law enforcement and intelligence agencies, consider using anonymous remailers and cryptography" Regards

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[CYBERIA] A VERY significant DMCA case
by R.A. Hettinga 18 Nov '04

18 Nov '04

-----BEGIN PGP SIGNED MESSAGE----- Hash: SHA1 - --- begin forwarded text DomainKey-Signature: a=rsa-sha1; q=dns; c=nofws; s=s1024; d=yahoo.com; b=oTDVOd2nHalBsKpKJum+5IY+lu1RJaHM79+4MmwY72xPRCq9nhudLZRniLNmeZojjGL9Cl3sFptEpXD2Go79CazzJCeB/dg4OT0EcNTRhLoB3c/qMqE5b0YopkFen3gJ4Zw0SKmrbN1bSGKlXBqAkrsurOheKaqq7Dd2lM/Yq68= ; Date: Thu, 18 Nov 2004 07:53:23 -0800 Reply-To: Law & Policy of Computer Communications <CYBERIA-L(a)LISTSERV.AOL.COM> Sender: Law & Policy of Computer Communications <CYBERIA-L(a)LISTSERV.AOL.COM> Comments: DomainKeys? See http://antispam.yahoo.com/domainkeys From: Paul Gowder <paultopia(a)YAHOO.COM> Subject: [CYBERIA] A VERY significant DMCA case To: CYBERIA-L(a)LISTSERV.AOL.COM This just came to my attention. I don't know if it's been mentioned here before, since I only read this list intermittently. Still... Lexmark International Inc. v. Static Control Components Inc., 6th Cir., No. 03-5400 10/26/04 http://pacer.ca6.uscourts.gov/opinions.pdf/04a0364p-06.pdf This case appears to be a ringing blow against the DMCA, and against copyright fascism in general. The Sixth Circuit, vacating a grant of preliminary injunction, held that a program was likely uncopyrightable, because unoriginal, because its functional requirements merged with its expression. It further concluded that the DMCA can't be used to protect such an un-copyrightable work. Because this was before the court on review of a preliminary injunction, it's not terribly definitive on the facts -- but as a statement of law -- it seems very promising. Thoughts? __________________________________ Do you Yahoo!? The all-new My Yahoo! - Get yours free! http://my.yahoo.com ********************************************************************** For Listserv Instructions, see http://www.lawlists.net/cyberia Off-Topic threads: http://www.lawlists.net/mailman/listinfo/cyberia-ot Need more help? Send mail to: Cyberia-L-Request(a)listserv.aol.com ********************************************************************** - --- end forwarded text - -- - ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' -----BEGIN PGP SIGNATURE----- Version: 1308 iQA/AwUBQZ0H9sPxH8jf3ohaEQKIEgCglPuzNup4Ni+fVo2ePX/gzTO0jkcAnAvu kKZN3l2htctoER3TCElpfZXL =Ijza -----END PGP SIGNATURE-----

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Just Another Chip in the (Privacy) Wall
by R.A. Hettinga 18 Nov '04

18 Nov '04

<http://www.technologyreview.com/articles/04/11/wo_kushner111804.asp?p=0> Technology Review Just Another Chip in the (Privacy) Wall An electronic database implanted under the skin can assure speedy and proper medical care-but is it worth it? By David Kushner November 18, 2004 You can almost see the ads now: Imagine a bright future with a chip in your arm! Went to the supermarket, but left the wallet at home? No problem! Flex your bicep and the smiling cashier passes a scanner over your arm. Voila-identification chip recognized! Problem solved. Your credit is good with us! Passed out during a sunrise jaunt on the top of Haleakala Mountain in Maui? Fret not! The hospital down below is on the case. Arm please. Scanner! The readout on the computer is fine. Just a little altitude sickness. Key to the safety deposit box weighing you down? Chuck it! Next time you're in the bank, give the teller a friendly wave-and watch the doors open to greet you! After decades as the stuff of sci-fi novels and anime movies, the age of chipped humans is finally a reality. Last month, following two years of review, the Food and Drug Administration approved the use of an implantable chip for medical applications. Each Verichip is the size of a grain of rice and contains a unique, 16-digit radio frequency ID. Linked to a database, that ID tag can call up a variety of information-from medical records to financial information. Not surprisingly, the technology is causing its share of controversy. Civil liberties groups are calling this the end of privacy. Religious groups are calling it the number of the beast. Down on the shores of Delray Beach, FL, Applied Digital-the company behind the Verichip-calls it a goldmine. Like a lot of new technologies, the Verichip happened rather by accident. Fifteen years ago, a company called Digital Angel developed implantable identification chips for the purpose of tracking companion pets and cattle. But the idea was nothing to moo at. Last year, 800,000 animal chips were sold in the United States for $55 to $70 apiece-30 percent more than in 2002. If the chips could identify animals, why not a human being? This thought occurred to Richard Seelig, a surgeon in New Jersey, shortly after the attacks of September 11, 2001. Seelig watched with horror as New York City firemen scrawled their social security numbers in black ink on the forearms-just in case they were to be burned beyond recognition in the inferno. Familiar with Digital Angel's work, Seelig voluntarily implanted himself with a radio frequency identification chip. And the race to bring it to the rest of the world was on. According to Angela Fulcher, spokesperson for Applied Digital, the human chip works in essentially the same manner as the animal chips. The chip is contained inside a cylindrical transponder, a glass tube 11 millimeters in length and 2.1 millimeters in diameter. Along with the chip is an antenna coil, which picks up and transmits the identification number to a scanner. The Pocket Reader, an existing handheld scanner created by Applied Digital, reads the radio frequency ID number when it's passed over the skin within a space of three or four inches. Unlike the animal version, the human chip is coated with Biobond-a porous polypropylene sheathe that connects to surrounding tissues. The chip is implanted, via a proprietary Verichip inserter, in a fleshy area such as the bicep. "Based on our experience at with microchips and animals," Fulcher says, "we see the lifespan at being 10 years." Although newly approved by the FDA, Verichips are already in use outside the United States. In total, an estimated 1,000 people have been implanted thus far. In Mexico, Rafael Macedo de la Concha, the country's attorney general, was implanted with a chip to provide secure access to government documents. In Barcelona, a beach club is injecting partiers with ID chips in lieu of hand stamps. Despite the announcement of the FDA approval, however, such frivolous implants may soon be second guessed. Organizations have criticized Applied Digital for not adequately disclosing the FDA's finding of Verichip's risks. A group called the Consumers Against Supermarket Privacy Invasion and Numbering, or Caspian, obtained a letter from the FDA to Applied Digital dated October 12, and posted it on the Web. The letter cites several "potential risks to health associated with the device," including adverse tissue reaction, migration of the implanted transponder, electromagnetic interference, electrical hazards, and incompatibility with magnetic resonance imaging. In addition to medical concerns, privacy advocates lament the potential abuses of implantable IDs. The outcry stems from the proliferation of radio frequency identification in products and badges. The San Francisco Public Library is trying to put ID chips in all of its books. In Virginia, the Department of Motor Vehicles is considering putting chips on every driver's license. The Ross Correctional Facility in Chillicothe, Ohio is running a pilot program that will track prisoners using chipped badges. Ostensibly, the idea is to provide a kind of DNA for merchandise (and inmates), a unique identifier that can track where and how products are distributed. But questions raised by implantable chips only complicate the matters-particularly in light of the increased use of surveillance in the workplace. "I see implantable chips as the wave of the future," says Frederick S. Lane III, author of The Naked Employee: How Technology Is Compromising Workplace Privacy. Lane says "The problem is that it gives employers access to so much information that they get to call the shots as far as what's innocuous." And the battles could intensify if, as some fear, the devices can be used in conjunction global position satellites. Fulcher says Applied Digital has in fact developed a prototype of an implantable "personal location device," and has already obtained the intellectual property. Bringing such technology to market, Fulcher says, "is a multimillion dollar conversation. At the moment, we're focusing on our current technology. If the right partner came along, however, that might be of interest." David Kushner is a contributing writer for Technology Review who covers digital entertainment technology. He is the author of Masters of Doom: How Two Guys Created an Empire and Transformed Pop Culture. -- ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

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Russia 'tests new missile systems'
by cypher＠tediouspath.com 17 Nov '04

17 Nov '04

Russia 'tests new missile systems' Wednesday, November 17, 2004 Posted: 6:59 PM EST (2359 GMT) MOSCOW, Russia (CNN) -- Russian President Vladimir Putin announced Wednesday that his country's armed forces will soon have access to advanced nuclear missile systems unavailable in any other country. "We are conducting research and are testing the most up-to-date nuclear missile systems, which, I'm sure, will be supplied to the armed forces in the near future," Putin told a conference of high-ranking military officials, according to a translation from Russia's Interfax News Agency. "What is even more important, these systems will have no analogues in the other nuclear powers during the next few years." The Bush administration said the developments in Russia's nuclear program are consistent with the Moscow Treaty, signed between President Bush and Putin in May 2002. "We are confident that Russia's plans are not threatening and are consistent with its obligations, and I think are indicative of a new strategic relationship between the United States and Russia that is focused on reducing threats and increasing confidence," deputy State Department spokesman Adam Ereli told reporters. The treaty, which required both sides to reduce their deployed strategic nuclear warheads to between 1,700 and 2,200 by 2012, was designed to establish a new strategic relationship between the two nations based on partnership and cooperation. But State Department officials told CNN on condition of anonymity that although they don't think Putin's comments are anything to worry about, they will be seeking further clarification from the Russians about the specific modernizations in Moscow's program. "As far as we can tell there is nothing to be concerned about, but Putin did not give a lot of detail," one official said. "We are trying to figure out what he meant. Did he mean what we think he means or is this something that is not covered by the treaty?" Another official said that Putin's comments could be viewed an attempt to impress his military leaders with assurances that Russia's weapons programs are competitive. "This may well have been his way of talking to his defense folks," this official said. "But we are trying to find out more." President Bush will meet with Putin in Chile later this week at a summit of Asian Pacific Economic Cooperation, where he is expected to discuss the matter, this official said. http://www.cnn.com/2004/WORLD/europe/11/17/russia.putin/index.html ~~~~~~~~~~~~~~~~~~~~~~~~~~~~ This message was sent from The Tedious Path Are you ready to travel The Tedious Path? http://www.tediouspath.com http://forum.tediouspath.com

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How scammers run rings round eBay
by R.A. Hettinga 17 Nov '04

17 Nov '04

-----BEGIN PGP SIGNED MESSAGE----- Hash: SHA1 <http://www.theregister.co.uk/2004/11/16/petty_fraudsters_ebay/print.html> The Register Biting the hand that feeds IT The Register B; Internet and Law B; Wild Wild Web B; Original URL: http://www.theregister.co.uk/2004/11/16/petty_fraudsters_ebay/ How scammers run rings round eBay By Ken Young (robin.lettice at theregister.co.uk) Published Tuesday 16th November 2004 16:15 GMT Everyone knows that buying and selling on eBay is precarious. Even eBay admits this and gives basic advice on its site that it believes helps eliminate most fraud. But there appears to be a basic weakness in eBay's system that fraudsters and petty thieves are exploiting. It occurs when buyers pay sellers direct into the sellers' bank account by cheque or cash. The following is a real example that occurred in September this year (names withheld for legal reasons). Let's call the buyer Tom and the seller Harry. Tom won the bid for a mobile phone and agreed to pay Harry (who lives 80 miles away from Tom) B#185 plus B#6 insurance using cash at a branch of Harry's bank. A few days later a box arrived. It contained a battery charger and an earplug, but no phone. Tom informed Harry who said that he believed someone at the post office must have stolen the phone and that he would look into it. Days passed and Tom then asked Harry to claim on the insurance. Harry said he had lost the insurance slip and would instead refund 50 per cent of the B#185. A week passed and Tom called Harry to say no payment had been received and that he was losing his patience and would report the matter to eBay. Harry made more excuses and stopped answering his mobile phone. Over the next few weeks they spoke occasionally but Harry refused to send any money and blamed Tom for his removal from eBay (subsequent to Tom informing eBay of his loss). Tom contacted Harry's bank but the bank refused to provide Harry's address. Tom only knows Harry's mobile phone number and Hotmail email address. In summary, Tom spent B#196 on a phone that never arrived and he is not alone. As a result of basic research for this story we have been contacted by five people who have experienced similar scams (their stories, in emails, are copied below). The fact is it appears far too easy for this scam to be perpetrated. Pattern of fraud The pattern is all too predictable. Buyers and sellers agree not to go through the more secure PayPal system because it costs more to do so. So buyers take the risk of sending the money to the seller who either doesn't send the goods or sends shoddy or fake goods. The sellers protect themselves against prosecution by claiming loss, or disputing the buyer's version of events. The amounts involved - though not insignificant to the buyer - are too small for eBay to want to take the matter further. There is one other common factor in all these stories. Though the buyers report the matter to eBay they are invariably frustrated at standard email responses and being steered towards a mediation system which costs the buyer B#15 and even then may or may not lead to resolution. Alternatively, sellers can claim compensation through eBay and may get a maximum of B#105 - if they claim between 30 and 90 days after the event and meet the criteria for payment. In our example above Tom made a claim last month and is still waiting. A common refrain is: "Should I report this to the police? eBay are not replying to my emails about this and I don't know if the police are aware or not. What should I do?" eBay declined an interview in relation to this story but instead issued a statement: "eBay takes the issue of fraud very seriously and investigates every case of fraud reported to it. eBay currently has over 1,000 people worldwide with backgrounds in law enforcement, customer support, advanced computer engineering and analysis dedicated to making eBay one of the safest places to trade online and, in the UK, employs an ex-Scotland Yard officer as liaison point for law enforcement agencies. "The majority of transactions on the eBay site are completely secure and without incident. Approximately 0.01 per cent of transactions end in a confirmed case of fraud." This means that for every million transactions, 100 are 'confirmed' fraudulent, though the criteria for this confirmation are not available. Any security consultant will say that is an acceptable level of risk and way below fraud levels on credit cards. Not surprisingly, eBay therefore does not advise people specifically not to pay by cheque or cash payment into a seller's bank account. Top tips On the eBay website its 'top tips' state that sellers should ideally use secure payment systems like PayPal (which offers greater levels of protection, though still limited if the seller has little or no track record) and should NOT use money transfer services "like Western Union". But aside from telling buyers to be wary it does not tell buyers NOT to send cheques or pay directly into sellers' bank accounts (either by money transfer or using cash at a bank branch). Clearly it believes that most such transactions are safe and therefore if the buyer assesses the risk as low, then why not? Many eBay users may agree - it's 'caveat emptor' applied to the world of online car boot sales. But when Steve Gold, a security consultant, celebrity ex-hacker (he co-hacked the Duke of Edinburgh's Prestel mailbox), and former accountant also gets hit by such a scam you begin to wonder how the mass of eBay's users are avoiding getting stung and whether the 0.01 per cent figure is an accurate reflection of the amount fraud occurring. Gold, an experienced eBay user, reports that he bought a hard drive for B#63 from a man who never sent the item. After weeks of the usual hassle he used 192.com to track the man down to confront him. The seller - somewhat shocked to see his 'victim' - pleaded poverty and illness and apologized profusely. Gold admitted defeat safe in the knowledge that at least he had confronted his fraudster and learnt a useful - if painful - lesson. Pants down He now says he uses a mixture of web tools to check out sellers. He pays 192.com B#25 per 100 enquiries to get addresses from phone numbers; he uses maporama.com to check out locations of sellers; and he admits he is more cautious than ever. "eBay is caught with its pants down," he says. "They are neglecting their customers; they should make a shed load of information available to help people to avoid this." Like others Gold says he hit a brick wall when he tried to get other bodies involved: "I went to trading standards - they weren't interested. I even compiled a dossier on the seller and sent it to his local police force. Subsequently they told me they were aware of eBay fraud but don't deal with it." Gold believes the level of fraud on eBay is higher than the 0.01 per cent figure given: "But how can we tell? eBay won't reveal the real figures so we have no way of knowing." He has a point. Credit card fraud has been reduced over the years by greater public awareness over the levels and types of fraud occurring. eBay is relying on sellers to be 'careful' but the question for the regulatory authorities remains: Is eBay doing enough to protect its users? Those who lose out as a result of this type of scam certainly think not. Clearly eBay cannot be held responsible for dishonesty among sellers but perhaps it could do a lot more to warn people how easy it is for petty criminals to exploit our desire for a bargain. Maybe it is time for an independent body to track complaints against the system so that buyers can get a better picture of the types and frequency of frauds occurring. B. Below are a selection of emails from others defrauded via eBay. Names have been omitted for legal reasons: I was cheated out of B#200 when I tried to buy an ipod. I corresponded with the seller, who seemed friendly until I sent my money and he clammed up. I got emails from another apparent victim, who also was a bit shy of giving out his contact details. I suspect the second person was the first in disguise. Top cap it all, the seller gave a bank account for me to deposit the money, which I did, but it turned out that his identity was totally fake - in fact it was someone else's ID. So he had used a real ID (not his own), to open not one but three accounts at Nationwide to use for fake eBay transactions. I contacted the police but the trail went cold. I did manage to get Nationwide to close the accounts down They said he had been taking money out as soon as it hit the account. I tried to contact eBay with the details, saying the guy wasn't returning my emails, they responded with an email saying "why don't you try our arbitration service." I emailed them asking how I could do that if the guy won't respond to me. They replied saying they were sorry about that but maybe I should try their arbitration service. I then asked how I could claim on their insurance policy to reimburse defrauded customers, and they simply replied advising me to try their arbitration service. I bought a couple of Tiffany items - from different sellers - for my niece last Christmas. One item was fine - the other was a fake. The girl who sold it handled it perfectly. She was very chatty (by email) and was 'touched' when I told her the thing was intended as a gift for my niece etc..... Anyway, when my niece received the item, it was obviously a fake. We did consult Tiffany, who confirmed that they hadn't ever manufactured a piece in that style. I got back on to her and her response was something not so far short of f off - but without the swear words. I was furious. I contemplated forms of retribution. I did, however, go thru the Safe Harbour system but with no success. I later made a claim from eBay but it was such a long-winded process that i kind of forgot to finish it off. So I just lost the money. From my experience I'd suggest eBay needs to sort out its claims policy. It's such a hassle that it really is off-putting. I still use eBay but without the same enthusiasm. I have a reseller friend who was a victim of an eBay scam, and to add insult to injury not only did they steal his card details on a non-existent transaction, they sent him a brick through the post to rub salt into that wound. - -- - ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' -----BEGIN PGP SIGNATURE----- Version: 1308 iQA/AwUBQZttm8PxH8jf3ohaEQJupACffXM/FxKtkOvURxpHZ/rdHqcdT1UAoIb5 Xrp51MUU1m32O0RrnG/yCr65 =p97f -----END PGP SIGNATURE-----

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Students Tracked By RFID (fwd from brian-slashdotnews@hyperreal.org)
by Eugen Leitl 17 Nov '04

17 Nov '04

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[p2p-hackers] Seth Johnson: Request for the P2P Workshop at the FTC (fwd from seth.johnson@RealMeasures.dyndns.org)
by Eugen Leitl 17 Nov '04

17 Nov '04

----- Forwarded message from Seth Johnson <seth.johnson(a)RealMeasures.dyndns.org> -----

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