March 2004 - cypherpunks-legacy

RE: J.P. Morgan Is Facing Heat Of Patriot Act
by Tyler Durden 11 Mar '04

11 Mar '04

"This is how the US intimidates such that the USG can monitor all transactions. A serious practical problem for e$ when it needs to interface to atoms." I'm also tempted to think that the USG needs to retain illicit drug-price differentials in order to fund backdoor opps. Hum. Perhaps on a larger scale, they don't want currency differences to be beyond their control. The "American Century" indeed. -TD >From: "Major Variola (ret)" <mv(a)cdc.gov> >To: "cypherpunks(a)al-qaeda.net" <cypherpunks(a)al-qaeda.net> >Subject: RE: J.P. Morgan Is Facing Heat Of Patriot Act >Date: Wed, 10 Mar 2004 11:49:47 -0800 > >At 10:11 AM 3/10/04 -0500, Tyler Durden wrote: > >Holy Crap this seems bizarre. This isn't even really a case of "know >your > >customers", but "know your customers' customers", isn't it? > > > >Is this some kind of "snipe hunt" or mere "Brazil"-like government > >incompetence and mindless application of half-baked laws? > >Optimist. > >This is how the US intimidates such that the USG can monitor >all transactions. A serious practical problem for e$ when it >needs to interface to atoms. > >.... >The python says to the goat in its coils: relax, exhale... >A tentacle grows another sucker. > > _________________________________________________________________ One-click access to Hotmail from any Web page download MSN Toolbar now! http://clk.atdmt.com/AVE/go/onm00200413ave/direct/01/

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RE: J.P. Morgan Is Facing Heat Of Patriot Act
by Major Variola (ret) 11 Mar '04

11 Mar '04

At 10:11 AM 3/10/04 -0500, Tyler Durden wrote: >Holy Crap this seems bizarre. This isn't even really a case of "know your >customers", but "know your customers' customers", isn't it? > >Is this some kind of "snipe hunt" or mere "Brazil"-like government >incompetence and mindless application of half-baked laws? Optimist. This is how the US intimidates such that the USG can monitor all transactions. A serious practical problem for e$ when it needs to interface to atoms. .... The python says to the goat in its coils: relax, exhale... A tentacle grows another sucker.

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RE: J.P. Morgan Is Facing Heat Of Patriot Act
by Tyler Durden 10 Mar '04

10 Mar '04

Holy Crap this seems bizarre. This isn't even really a case of "know your customers", but "know your customers' customers", isn't it? Is this some kind of "snipe hunt" or mere "Brazil"-like government incompetence and mindless application of half-baked laws? -TD >From: "R. A. Hettinga" <rah(a)shipwright.com> >To: cypherpunks(a)al-qaeda.net, e$(a)vmeng.com >Subject: J.P. Morgan Is Facing Heat Of Patriot Act >Date: Tue, 9 Mar 2004 18:13:40 -0500 > ><http://online.wsj.com/article_print/0,,SB107878833057749707,00.html> > >The Wall Street Journal > > March 9, 2004 > > > >J.P. Morgan > Is Facing Heat > Of Patriot Act > >By RANDALL SMITH >Staff Reporter of THE WALL STREET JOURNAL > > > >NEW YORK -- Manhattan District Attorney Robert Morgenthau has asked banking >regulators to examine documents from the recent criminal conviction of an >unlicensed money-transfer operation to determine whether J.P. Morgan Chase >& Co. or its predecessor banks violated "know your customer" rules. > >Staffers in Mr. Morgenthau's office last year turned over to regulators >court papers from its investigation of Beacon Hill Service Corp., which was >convicted Feb. 23 in state criminal court in Manhattan of four felony >counts of operating as an unlicensed money transmitter, Mr. Morgenthau >said. > >The regulators include the New York State Banking Department and the >Federal Reserve Bank of New York, Mr. Morgenthau added. Neither agency >would comment on the action. However, the state agency has been reviewing >the case, according to one person familiar with the matter. > >J.P. Morgan Chase, which declined to comment on any possible rule >violations, said it has been working with regulators to tighten its >standards. "We agree with regulators that financial institutions should >continually raise standards on know-your-customer policies, and have worked >with them to ensure that we tighten ours and strive to exceed the law," a >bank spokeswoman said. > >The USA Patriot Act, adopted in October 2001, expanded the scope of U.S. >money-laundering rules in order to make it harder for terrorists to move >money without attracting attention. It includes beefed-up >know-your-customer requirements for some financial institutions, according >to some legal experts. > >Beacon Hill took deposits and transmitted money on behalf of clients in >Central and South America, including wealthy individuals and money-exchange >houses, according to a filing by prosecutors in the criminal case. J.P. >Morgan Chase was Beacon Hill's bank and accepted deposits from Beacon until >Beacon's office was searched by Mr. Morgenthau's agents on Feb. 4, 2003, >according to an affidavit by a lawyer for Beacon Hill. > >Beacon Hill, which began operating in 1994, originally had an account with >Chemical Bank, which later merged with Chase Manhattan Corp., which in turn >merged with J.P. Morgan & Co. in 2000 to become J.P. Morgan Chase. Beacon >had 49 customers as of mid-2002, 36 of them in a "pooled" account that >shielded their identities from the bank, according to a report by a >consultant to Beacon Hill that is part of the court record. > >At Beacon Hill, $5.5 billion "went in and out between 1997 and 2002," Mr. >Morgenthau said. Yet, such pooled arrangements meant J.P. Morgan, its >predecessor banks and other banks who have dealt with money-transfer >businesses in similar fashion have transferred large sums -- a lot of it >"to secrecy jurisdictions" -- without knowing whose money it really was, he >said. Such banks "were not observing the know-your-customer rule." > >He said that there isn't an accusation that J.P. Morgan was dealing with >illegal money. The question, he said, is this: "Should they have taken >money from an unlicensed money transmitter? That's a matter for State >Banking and the Federal Reserve to be concerned about." He asserted, "They >just weren't asking the questions under know-your-customer [that] they were >required to ask." > >The New York licensing requirement for money transmitters, originally >adopted as a consumer-protection measure in 1963 to guard against fraud or >insolvency, was amended in 1990 to combat money laundering, according to >the banking department. The licensing process requires money transmitters >to have antimoney-laundering programs and to file suspicious activity >reports about large cash transactions, according to Betty Santangelo, a >money-laundering expert at law firm Schulte Roth & Zabel LLP. > >Although an official at J.P. Morgan Chase asked Beacon Hill as early as >1998 if it needed a license to operate as a money transmitter, lawyers for >Beacon Hill said they weren't able to get an answer from the state Banking >Department, according to court filings. One reason the Banking Department >didn't answer faster, prosecutors said in court, was that Beacon Hill's >lawyer asked the question in October 2000 about a client identified only as >"XYZ Corp.," without disclosing that it already was engaging in the >activities described. > >At one point, prosecutors contended that a senior Chase official lied to a >state regulator to cover for Beacon Hill. After Beacon Hill's lawyer told >state banking officials at a meeting in January 2001 that XYZ planned to >bank at Chase, a Banking Department lawyer, Sara Kelsey, followed up with >Chase's compliance chief, Greg Meredith. Mr. Meredith "deceitfully >confirmed that the business was not yet in operation," according to >grand-jury minutes described in a memorandum of law submitted by Mr. >Morgenthau on Oct. 21, 2003, as part of the Beacon Hill case. Mr. Meredith >told Beacon Hill it would have to hire an outside consultant to review its >regulatory compliance, according to a filing by prosecutors. Although Chase >wanted an audit of Beacon Hill, its owner, Anibal Contreras, restricted the >outside consultant to a review of its policies and procedures, the filing >said. > >Mr. Meredith didn't return a call, and a J.P. Morgan Chase spokeswoman said >he wouldn't have any comment. Mr. Meredith no longer serves as the bank's >head of compliance, according to one person familiar with the bank, in part >owing to his failure to take more aggressive action in dealing with Beacon >Hill. > >The J.P. Morgan Chase spokeswoman said the bank first asked Beacon Hill to >obtain "an outside compliance review," which showed "no indication of money >laundering." The bank then asked for an outside legal opinion about whether >Beacon Hill "needed a license, and the opinion said they didn't," she >added. Eventually, the bank asked Beacon Hill to seek an opinion from >regulators. "Our steps were directionally correct but too slow and not >forceful enough," she said. > >J.P. Morgan Chase since has exited the business of dealing with wholesale >money remitters, she added. The bank also has tightened its >money-laundering controls, put in new monitoring systems, and "made >organizational changes in an effort to meet the higher standards financial >institutions are being held to," she said. > >Mr. Morgenthau said that the issue of identifying customers of >money-transmitting businesses is "a very serious problem," but "I'm having >trouble convincing people of that: the regulators and the banks >themselves." One problem, he said, is what he called the "patchwork system >of regulation," with some bank units also regulated by the U.S. Comptroller >of the Currency, the Federal Deposit Insurance Corp. and other entities. > > >-- >----------------- >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' > _________________________________________________________________ Create a Job Alert on MSN Careers and enter for a chance to win $1000! http://msn.careerbuilder.com/promo/kaday.htm?siteid=CBMSN_1K&sc_extcmp=JS_J…

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J.P. Morgan Is Facing Heat Of Patriot Act
by R. A. Hettinga 10 Mar '04

10 Mar '04

<http://online.wsj.com/article_print/0,,SB107878833057749707,00.html> The Wall Street Journal March 9, 2004 J.P. Morgan Is Facing Heat Of Patriot Act By RANDALL SMITH Staff Reporter of THE WALL STREET JOURNAL NEW YORK -- Manhattan District Attorney Robert Morgenthau has asked banking regulators to examine documents from the recent criminal conviction of an unlicensed money-transfer operation to determine whether J.P. Morgan Chase & Co. or its predecessor banks violated "know your customer" rules. Staffers in Mr. Morgenthau's office last year turned over to regulators court papers from its investigation of Beacon Hill Service Corp., which was convicted Feb. 23 in state criminal court in Manhattan of four felony counts of operating as an unlicensed money transmitter, Mr. Morgenthau said. The regulators include the New York State Banking Department and the Federal Reserve Bank of New York, Mr. Morgenthau added. Neither agency would comment on the action. However, the state agency has been reviewing the case, according to one person familiar with the matter. J.P. Morgan Chase, which declined to comment on any possible rule violations, said it has been working with regulators to tighten its standards. "We agree with regulators that financial institutions should continually raise standards on know-your-customer policies, and have worked with them to ensure that we tighten ours and strive to exceed the law," a bank spokeswoman said. The USA Patriot Act, adopted in October 2001, expanded the scope of U.S. money-laundering rules in order to make it harder for terrorists to move money without attracting attention. It includes beefed-up know-your-customer requirements for some financial institutions, according to some legal experts. Beacon Hill took deposits and transmitted money on behalf of clients in Central and South America, including wealthy individuals and money-exchange houses, according to a filing by prosecutors in the criminal case. J.P. Morgan Chase was Beacon Hill's bank and accepted deposits from Beacon until Beacon's office was searched by Mr. Morgenthau's agents on Feb. 4, 2003, according to an affidavit by a lawyer for Beacon Hill. Beacon Hill, which began operating in 1994, originally had an account with Chemical Bank, which later merged with Chase Manhattan Corp., which in turn merged with J.P. Morgan & Co. in 2000 to become J.P. Morgan Chase. Beacon had 49 customers as of mid-2002, 36 of them in a "pooled" account that shielded their identities from the bank, according to a report by a consultant to Beacon Hill that is part of the court record. At Beacon Hill, $5.5 billion "went in and out between 1997 and 2002," Mr. Morgenthau said. Yet, such pooled arrangements meant J.P. Morgan, its predecessor banks and other banks who have dealt with money-transfer businesses in similar fashion have transferred large sums -- a lot of it "to secrecy jurisdictions" -- without knowing whose money it really was, he said. Such banks "were not observing the know-your-customer rule." He said that there isn't an accusation that J.P. Morgan was dealing with illegal money. The question, he said, is this: "Should they have taken money from an unlicensed money transmitter? That's a matter for State Banking and the Federal Reserve to be concerned about." He asserted, "They just weren't asking the questions under know-your-customer [that] they were required to ask." The New York licensing requirement for money transmitters, originally adopted as a consumer-protection measure in 1963 to guard against fraud or insolvency, was amended in 1990 to combat money laundering, according to the banking department. The licensing process requires money transmitters to have antimoney-laundering programs and to file suspicious activity reports about large cash transactions, according to Betty Santangelo, a money-laundering expert at law firm Schulte Roth & Zabel LLP. Although an official at J.P. Morgan Chase asked Beacon Hill as early as 1998 if it needed a license to operate as a money transmitter, lawyers for Beacon Hill said they weren't able to get an answer from the state Banking Department, according to court filings. One reason the Banking Department didn't answer faster, prosecutors said in court, was that Beacon Hill's lawyer asked the question in October 2000 about a client identified only as "XYZ Corp.," without disclosing that it already was engaging in the activities described. At one point, prosecutors contended that a senior Chase official lied to a state regulator to cover for Beacon Hill. After Beacon Hill's lawyer told state banking officials at a meeting in January 2001 that XYZ planned to bank at Chase, a Banking Department lawyer, Sara Kelsey, followed up with Chase's compliance chief, Greg Meredith. Mr. Meredith "deceitfully confirmed that the business was not yet in operation," according to grand-jury minutes described in a memorandum of law submitted by Mr. Morgenthau on Oct. 21, 2003, as part of the Beacon Hill case. Mr. Meredith told Beacon Hill it would have to hire an outside consultant to review its regulatory compliance, according to a filing by prosecutors. Although Chase wanted an audit of Beacon Hill, its owner, Anibal Contreras, restricted the outside consultant to a review of its policies and procedures, the filing said. Mr. Meredith didn't return a call, and a J.P. Morgan Chase spokeswoman said he wouldn't have any comment. Mr. Meredith no longer serves as the bank's head of compliance, according to one person familiar with the bank, in part owing to his failure to take more aggressive action in dealing with Beacon Hill. The J.P. Morgan Chase spokeswoman said the bank first asked Beacon Hill to obtain "an outside compliance review," which showed "no indication of money laundering." The bank then asked for an outside legal opinion about whether Beacon Hill "needed a license, and the opinion said they didn't," she added. Eventually, the bank asked Beacon Hill to seek an opinion from regulators. "Our steps were directionally correct but too slow and not forceful enough," she said. J.P. Morgan Chase since has exited the business of dealing with wholesale money remitters, she added. The bank also has tightened its money-laundering controls, put in new monitoring systems, and "made organizational changes in an effort to meet the higher standards financial institutions are being held to," she said. Mr. Morgenthau said that the issue of identifying customers of money-transmitting businesses is "a very serious problem," but "I'm having trouble convincing people of that: the regulators and the banks themselves." One problem, he said, is what he called the "patchwork system of regulation," with some bank units also regulated by the U.S. Comptroller of the Currency, the Federal Deposit Insurance Corp. and other entities. -- ----------------- 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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Filming the Hand That's Stealing His Wallet
by R. A. Hettinga 09 Mar '04

09 Mar '04

<http://www.nytimes.com/2004/03/09/business/09flier.html?th=&pagewanted=prin…> The New York Times March 9, 2004 FREQUENT FLIER Filming the Hand That's Stealing His Wallet With FRANCINE PARNES f you want my title, it's professor of pickpocketry. My wife, Bambi Vincent, and I spend seven months each year traveling the world to film pickpockets and other street thieves who prey on unsuspecting tourists. As a security consultant to business travelers, law enforcement and corporations, I live to expose the latest tricks of scoundrels. After we observe a thief in action, we usually try to lure him into conversation and pick his brain the way he picks the pockets of his victims. Most thieves love to brag, though on other occasions we've had rocks thrown at us and knives pulled on us, and we've been hit and spat upon. I keep my money tucked inside my trousers, in a thin leather pouch that hangs from my belt. I also have a wallet stuffed only with newspaper, which I use as bait. It has been stolen from my hip pocket more than 100 times. Sometimes I confront the thieves and it magically appears on the ground. But other times I steal it back; that's the quickest way to establish rapport with pickpockets. When I invite them for coffee, I think they are in awe, and that is why they reveal their secrets and give me their cellphone numbers. Granted, the phones are usually stolen. Our cameras are no bigger than a dime, hidden inside items like buttons on shirt collars. In London, I was tracking some pickpockets for a news program and had to go to the men's room. The camera was in my eyeglasses, and when I stood at the urinal, I forgot to turn my head. The editors had to do some cutting. I probably have more insight into the subculture of global pickpocketing than any other person in the world, on either side of the law. But that doesn't mean that pickpockets can't outsmart me. Last summer in Rome, my wife and I were packed like sardines in a metro at rush hour near the crowded Spanish Steps. There were 20 people near the door, and 14 were probably pickpockets. A woman was working my hip pocket, gently moving out my wallet. I had a small wireless video camera hidden in a cellphone in my right hand, high up filming the action. Bambi was to my left, with two guys trying for her handbag, which she was keeping an eye on. Another team of three guys was trying to go for a tall American man standing close beside me. I pretended not to notice anything. Unbeknownst to me, they succeeded in removing a small video recorder from a bag I was holding at knee level while I was watching everyone's faces. Embarrassing, yes, but I have to acknowledge the finesse of high-end pickpockets because of the perfection in their combination of stealth and precise choreography. I have seen a person steal from someone in a wheelchair. I have seen women bare their breasts and drop their pants to shock and distract their victims if they are accused. Nothing has come close what I documented in Calcutta more than 40 years. Pickpockets with leprosy approached British expatriates coming out of church and reached out to them with ravaged hands missing fingers. The victim's reaction of shock and revulsion provided the distraction needed for the pickpocket's partner to extract his wallet. It was the most eye-opening incident in pickpocketing I have ever witnessed. As told to Francine Parnes. -- ----------------- 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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Evidence is clear: Videos convict
by R. A. Hettinga 09 Mar '04

09 Mar '04

<http://www2.ocregister.com/ocrweb/ocr/article.do?id=84540> The Orange County Register Monday, March 8, 2004 Evidence is clear: Videos convict And sometimes it's the accused themselves who provide the taped version of the smoking gun. By LARRY WELBORN The Orange County Register Twelve jurors and two alternates sat almost unblinkingly in a 10th-floor courtroom and watched a 21-minute videotape on two television monitors. Some squirmed in the swivel seats in the jury box but their eyes remained riveted on the screens, watching images of two men having sex with an apparently unconscious woman in a Newport Beach apartment as techno music droned in the background. The trial of Allen Ward Crocker provided jurors with a rare chance to see exactly what happened in a case of alleged sexual assault. Most of the time, jurors must decide guilt or innocence based on witness memories, documents or expert testimony. But with the inexpensive but still-sharp video cameras in existence these days, videotaped evidence is becoming more and more common in criminal courtrooms, veteran lawyers say. The Crocker case has similarities to the pending prosecution of Gregory Haidl, the son of an assistant sheriff, and two of his teenage friends. They face trial next month in the alleged rape of an unconscious 16-year-old girl in July 2002. Haidl, 18, videotaped the encounter in Newport Beach, and now prosecutors are using those images against him. The accused aren't the only ones providing police with videotape to show jurors. In Los Angeles, an amateur photographer recorded the notorious videotape of Rodney King being beaten by Los Angeles police officers. And in Orange County, a surveillance camera at a convenience store captured images of a former mental patient murdering sheriff's Deputy Brad Riches. "I call it the proliferation of Little Brother," said Costa Mesa defense attorney Paul S. Meyer, who has prosecuted and defended in criminal cases in Orange County for more than 30 years. "You know, just about everyone has a video camera these days. It's only common sense that these videotapes are showing up in trials." In the Crocker case, it took the eight-man, four-woman jury just 90 minutes to reach a verdict: guilty of rape. Deputy District Attorney Steve McGreevy argued that the videotape clearly depicted a crime-in-progress: The woman was unconscious after an evening of bar-hopping in Newport Beach and unable to give consent. Defense attorney Robert Chatterton insisted that the videotape showed that if the woman was unconscious, then Crocker, 36, of Tustin, was unaware of it. Crocker had a good-faith belief that the woman consented to sex, Chatterton argued. "We were able to witness it ourselves," said juror Kristina Durbin, 27, a health-care worker who lives in Mission Viejo. "Without the videotape, I wouldn't have been able to reach the decision because he would have been able to put doubt in my mind. But with the videotape, the crime he was charged with was right in front of me." The rape was caught on tape because Crocker's friend and alleged accomplice, Tim Marino, 41, started his video camera rolling after the victim passed out. The victim testified that she didn't know what was happening to her and didn't know that the episode had been videotaped. A $500,000 arrest warrant has been issued for Marino, who never kept an appointment with a Newport Beach police detective after an investigation of the Sept. 14, 2003, encounter was launched. Prominent Orange County defense attorney Jennifer Keller, a former deputy public defender and a former president of the Orange County Bar Association, said videotaped crimes won't be so rare in the future. "It seems everything we do now is recorded or videotaped," Keller said. "To our children, video cameras are second nature." Assistant District Attorney Roseanne Froeberg, head of the office's sex-crimes unit, said there have been sporadic cases in the past in which rapes or other sex crimes were memorialized on videotape. But she said she is seeing more of them lately. "It does make it easier for us to prosecute when criminals videotape themselves in the act," she said. "But to me, it is a sad commentary on our society. Videotaping their perversions for sport takes things to different level. An incredibly ugly level, in my opinion." Said Meyer: "I call these ego crimes, where the criminals memorialize their deeds on videotape." And yes, he added, "we will be seeing more and more of these." -- ----------------- 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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Posse What? -the neofascists
by Major Variola (ret.) 09 Mar '04

09 Mar '04

9 Mar 2004 04:00 GMT WSJ(3/9)Is Military Creeping Into Domestic Law Enforcement? Copyright ) 2004, Dow Jones Newswires (From THE WALL STREET JOURNAL) By Robert Block and Gary Fields IN A LITTLE-NOTICED side effect of the war on terrorism, the military is edging toward a sensitive area that has been off-limits to it historically: domestic intelligence gathering and law enforcement. Several recent incidents involving the military have raised concern among student and civil-rights groups. One was a visit last month by an Army intelligence agent to an official at the University of Texas law school in Austin. The agent demanded a videotape of a recent academic conference at the school so that he could identify what he described as "three Middle Eastern men" who had made "suspicious" remarks to Army lawyers at the seminar, according to the official, Susana Aleman, the dean of student affairs. The Army, while not disputing that the visit took place, declined to comment, saying the incident is under investigation. Last year, the Office of Naval Intelligence, the nation's primary source of global maritime intelligence, demanded access to the U.S. Customs Service's database on maritime trade, saying it needed information to thwart potential terrorist activity. Customs officials initially resisted the Navy's demands but eventually agreed to give naval intelligence much of what it wanted. In an interview earlier this month, U.S. Customs and Border Protection chief Robert C. Bonner said he shares data only after getting Navy assurances that the information won't be abused. Navy spokesman Jon Spiers says the Office of Naval Intelligence first approached customs about sharing inbound foreign cargo information in December 2002, and he denies there is anything improper about the request. The agency "has not overstepped any authority or crossed the line dividing law enforcement from military operations," he says. Lt. Spiers adds that when the Navy's top spy agency gains access to data about American companies and individuals, the information will be "subjected to a meticulous legal review" and will be retained only if it is directly related to the agency's mission to identify potential foreign threats. In another sign of military interest in domestic information-gathering, the Defense Intelligence Agency's new antiterrorism task force is looking to share information with law-enforcement officials in California and New York City, according to an August 2003 General Accounting Office report. Historically, Americans haven't trusted the military to do domestic police work. The 1878 Posse Comitatus Act, passed in response to abuses by federal troops in the South after the Civil War, prohibits the use of the military "to execute the laws" of the U.S. That's been widely interpreted as a ban on searching, arresting or spying on U.S. civilians by federal troops. But the law has been violated, notably during the Vietnam War, when Army operatives spied on antiwar activists on campuses. Meanwhile, Congress has eased the law's limits to allow the military to help prosecute the war on drugs. After the Sept. 11 attacks, the White House sought to further loosen restrictions to allow the military to take on a new domestic-security role. It has mostly been rebuffed. In May the House refused to approve a White House-backed proposal to give the Central Intelligence Agency and the military authority to scrutinize personal and business records of U.S. citizens. And the Senate last year blocked funding for a Pentagon project known as the Total Information Awareness program, which was supposed to collect a vast array of information on individuals, including medical, employment and credit-card histories. The issue of an expanding military role in domestic affairs also surfaced last year with the Pentagon's creation of the Northern Command, or Northcom, based in Colorado Springs, Colo. The new command, the first such military command designed to protect the U.S. homeland from a terrorist attack, has responsibility for the U.S, Canada, Mexico, portions of the Caribbean and U.S. coastal waters. Northcom's commander, Gen. Ralph "Ed" Eberhart, is the first general since the Civil War with operational authority exclusively over military forces within the U.S. Gen. Eberhart has stoked concern among civil-liberties advocates by saying that the military and civilians should be involved in developing "actionable intelligence" for the government. In September 2002, he told a group of National Guardsmen that the military and the National Guard should "change our radar scopes" to prevent terrorism. It is important to "not just look out, but we're also going to have to look in," he said, adding, "we can't let culture and the way we've always done it stand in the way." Northcom officials and other military leaders play down his remarks. "No one ran out after that speech and started snooping," one official says. Gen. Eberhart echoed that last September on PBS's "News Hour": "We are not going to be out there spying on people, " he said, though he added, "we get information from people who do." Further evidence of the blurring of the lines between the civilian and military worlds comes in a job-vacancy notice for a senior counterintelligence advisor to Northcom. The duties, according to the notice, include providing advice that goes beyond potential terrorism to include "other major criminal activity, such as drug cartels and large-scale money laundering" -- work usually under the purview of the Drug Enforcement Administration, the Federal Bureau of Investigation and the Secret Service. Another little-known Pentagon group, the Counterintelligence Field Activity, was set up two years ago. With 400 service members and civilians stationed around the globe, the CIFA was originally charged with protecting the military and critical infrastructure from spying by terrorists and foreign intelligence services. But in August, Paul Wolfowitz, the deputy defense secretary, issued a directive ordering the unit to maintain a "domestic law-enforcement database that includes information related to potential terrorist threats directed against the Department of Defense." The CIFA also works closely with the FBI and is conducting some duties for civilian agencies. For example, according to Department of Agriculture documents, the CIFA is in charge of doing background checks on foreign workers and scientists employed by the department's agricultural-research service. The group also provides information to the Information and Security Command, or Inscom, the Army's main intelligence organization, based at Fort Belvoir, Md. The Army intelligence agent who investigated the law-school conference was assigned to Inscom. Army officials reviewing the Texas incident concede that the agent may have overstepped his boundaries and should have tried to win the voluntary cooperation of the faculty and students. But they say that he was reacting to a possible counterintelligence threat to the military. It isn't clear why there were Army lawyers at the conference in the first place, though some officials say the attorneys wanted to learn more about Muslim traditions and Islamic law. Civil-rights advocates are skeptical. Robert Pugsley, professor of law at the Southwestern University School of Law in Los Angeles, says the Texas incident is "a chilling example" of the military's overreaching. "It'll multiply like fleas on a dog" if left unchecked, he says. "What we are starting to see is 50 years of legal refinement and revisions for oversight being quietly jettisoned," adds Steven Aftergood, an intelligence policy specialist at the Federation of American Scientists, a nonprofit, left-leaning think tank in Washington. But James Carafano, a policy analyst with the Heritage Foundation in Washington, says he believes the military has honored posse comitatus. His concern is that hard distinctions have been created between who has jurisdiction in homeland defense versus homeland security. It's distinctions terrorists might exploit, he says. "We may potentially be creating vulnerabilities." (END) Dow Jones Newswires March 08, 2004 23:00 ET (04:00 GMT) http://www.dowjonesnews.com/sample/samplestory.asp?StoryID=2004030904000010…

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Coin flip nonrandom
by Major Variola (ret) 09 Mar '04

09 Mar '04

Science News Online Week of Feb. 28, 2004; Vol. 165, No. 9 Toss Out the Toss-Up: Bias in heads-or-tails Erica Klarreich If you want to decide which football team takes the ball first or who gets the larger piece of cake, the fairest thing is to toss a coin, right? Not necessarily. A new mathematical analysis suggests that coin tossing is inherently biased: A coin is more likely to land on the same face it started out on. "I don't care how vigorously you throw it, you can't toss a coin fairly," says Persi Diaconis, a statistician at Stanford University who performed the study with Susan Holmes of Stanford and Richard Montgomery of the University of California, Santa Cruz. In 1986, mathematician Joseph Keller, now an emeritus professor at Stanford, proved that one fair way to toss a coin is to throw it so that it spins perfectly around a horizontal axis through the coin's center. Such a perfect toss would require superhuman precision. Every other possible toss is biased, according to an analysis described on Feb. 14 in Seattle at the annual meeting of the American Association for the Advancement of Science. The researchers' logic goes like this. At the opposite extreme from Keller's perfect toss is a completely biased toss, in which the coin stays flat while in the air. Since the coin never actually flips, it is guaranteed to land on the same face that it started out on. Between the perfectly spinning toss and the flat toss lies a continuum of other possibilities, in which the coin spins around a tilted axis, precessing like an old-fashioned children's top. Each of these possibilities is biased, the team found. The bias is most pronounced when the flip is close to being a flat toss. For a wide range of possible spins, the coin never flips at all, the team proved. In experiments, the researchers were surprised to find that it's difficult to tell from watching a coin whether it has flipped. A coin toss typically takes just half a second, with the circumference of the coin whizzing around at 3 meters per second. What's more, the coin's spin makes it wobble, often creating the illusion that the coin has flipped. "Sometimes we had the complete impression that the coin had turned over when it really hadn't," Holmes says. Magicians and charlatans may take advantage of this illusion. Keller observes, "Some people can throw the coin up so that it just wobbles but looks to the observer as if it is turning over." To see whether the predicted bias shows up in actual coin tosses, the team made movies of tossed coins and then calculated the axes of spin. Their preliminary data suggest that a coin will land the same way it started about 51 percent of the time. It would take about 10,000 tosses before a casual observer would become aware of such a small bias, Diaconis says. "Maybe that's why society hasn't noticed this before," he says. This slight bias pales when compared with that of spinning a coin on its edge. A spinning penny will land as tails about 80 percent of the time, Diaconis says, because the extra material on the head side shifts the center of mass slightly. During World War II, South African mathematician John Kerrich carried out 10,000 coin tosses while interned in a German prison camp. However, he didn't record which side the coin started on, so he couldn't have discovered the kind of bias the new analysis brings out. Says David Aldous, a statistician at the University of California, Berkeley, "This is a good lesson that even in simple things that people take for granted, there may be unexpected subtleties." If you have a comment on this article that you would like considered for publication in Science News, send it to editors(a)sciencenews.org. Please include your name and location. To subscribe to Science News (print), go to https://www.kable.com/pub/scnw/ subServices.asp. To sign up for the free weekly e-LETTER from Science News, go to http://www.sciencenews.org/pages/subscribe_form.asp. References: Diaconis, P. 2004. The search for randomness. American Association for the Advancement of Science annual meeting. Feb. 14. Seattle. Further Readings: Keller, J.B. 1986. The probability of heads. American Mathematical Monthly 93(March):191-197. Peterson, I. 2004. Heads or tails? Science News Online (Feb. 28). Available at http://www.sciencenews.org/articles/20040228/mathtrek.asp. Sources: David Aldous Department of Statistics University of California, Berkeley 367 Evans Hall Berkeley, CA 94720-3860 Persi Diaconis Department of Statistics Stanford University Stanford, CA 94305-4065 Susan P. Holmes Department of Statistics Stanford University Stanford, CA 94305-4065 Joseph B. Keller Stanford University Department of Mathematics Stanford, CA 94305-2125 Richard Mongomery Department of Mathematics University of California , Santa Cruz 1156 High Street Santa Cruz, CA 95064 http://63.240.200.111/articles/20040228/fob2.asp >From Science News, Vol. 165, No. 9, Feb. 28, 2004, p. 131. Copyright (c) 2004 Science Service. All rights reserved.

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Re: Earthlink to Test Caller ID for E-Mail
by An Metet 09 Mar '04

09 Mar '04

Eugen* Leitl <a href="http://leitl.org">leitl</a> writes: > The passphrase locking idear won't fly, but a biometrics-lockable > wallet could. Isn't part of Pd envelope goal establishing a tamper-proof > compartment? We know Pd is evil, but once hardware support is everywhere, > one can as well use it for something positive, for a change. Well, you're preaching to the choir now, son. Of course, it's a choir of one, but c'est la vie. The idea of finding good uses for Trusted Computing has not exactly been gushingly popular around here. In fact, you yourself have been one of the harshest critics of its pseudonymous proponent ("intelligent idiot" sound familiar?). The problem with Palladium as a solution to spam is first, that it is many years away, being part of the Longhorn OS release. The latest official estimates are 2006, rumors are that 2007 is the internal date, and whispers of 2008 exist. Then, it will take years before such systems become widely enough used that spammers can no longer find pre-Palladium systems to serve as a basis for attacks. We're probably talking 2011 at the earliest. We'll need adequate solutions to spam long before then. Secondly, you could use Palladium to arrange that it was impossible to send mail from your computer except via human interaction with your authorized email program. You'd have to set your outgoing mail server to require a password (such auth systems are already in widespread use) and you'd use Pd to lock up the password so that only the mail client could get at it (using the application-specific sealed storage feature). The user wouldn't have to type the password, in fact he wouldn't even have to know there was a password, but he'd have to click the send button himself. (Secure user I/O paths are a Palladium feature.) However, in doing this you give up the ability for ANY other program to send email, at least without the user jumping through a lot of hoops to authorize it. Maybe that's an inherently necessary feature, but there are arguably some "good" programs which can usefully send email, and you'll be tossing out those babies with the spam bathwater. Bye bye MAPI. Further, there's always the risk that the email program itself will be buggy and be able to be tricked into sending something without user authorization. Fortunately, the number of such bugs is likely to be few and confined to just one program, so those can probably be fixed relatively quickly. In short, Trusted Computing could in theory make a computer much more resistant to being used to send spam. It could still be taken over, but the malware wouldn't be able to get to the password necessary for sending mail. You'd need some help from the ISP to require the password and possibly block attempts to use remote mail servers. Of course, if the ISP is this clueful and cooperative, you'd think maybe it could stop you from sending a zillion messages per hour in the first place. The big problem is that TC is many years away. But now that you know how good it will be, I hope you will join me in my never ending battle to bring some perspective to the one-sided "debate" over this technology. There are good uses of TC, and maybe if people weren't so determined to oppose it with their last breath, we might see the technology becoming available a little sooner.

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[FoRK] Outlawing dissent: COINTELPRO resurgence (fwd from jbone@place.org)
by Eugen Leitl 08 Mar '04

08 Mar '04

----- Forwarded message from "jbone @ place. org" <jbone(a)place.org> -----

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