7-25-96. The Associated Press: Computer Codes May Aid Crime Washington -- FBI Director Louis Freeh warned Congress on Thursday that allowing uncontrolled export of U.S. computer security codes may help international criminals and terrorists hide their activities from law enforcement. "Encryption products used unchecked by criminals and terrorists for their illegal activities pose an extremely serious and, I believe, unacceptable threat," Freeh told the Senate Commerce, Science and Transportation Committee. Legislation pending in the Senate would permit U.S. companies to export high-tech encryption devices that ensure greater privacy for computer files, electronic mail messages and systems such as stock exchange transactions. Sponsors said the bill would "help America maintain our superiority in software development" and guard against unwarranted government intrusion. "It is irrelevant that we can make a better product if we cannot sell it," said Sen. John Ashcroft, R-Mo., one of the sponsors. The Clinton administration has proposed that encryption exports be allowed only if a decoding "key" for the devices is left with a third party -- such as a bank or insurance company -- so that law enforcement personnel with a court order could break the code, if necessary. Freeh said such an arrangement would safely open profitable foreign markets for U.S. software companies. The Internet, he said, "was never intended as a place without police officers. We need cops there, as we do elsewhere, to protect people, to guard their rights." The encryption codes available today are so powerful, Freeh said, that it would take the FBI more than a year to decode a single message in some cases. Ramzi Yousef, on trial in New York on charges of plotting to bomb a dozen U.S. airliners, used a laptop computer containing files the FBI still hasn't been able to decode, he added. Sponsors and industry officials noted, however, that many of these devices are already available abroad, and anyone can download them free from the Internet. They can also be sold within the United States at local computer stores. "The criminal element the administration is trying to prevent from obtaining this technology already has it," said Roel Pieper, president of Tandem Computers Inc. "The only ones who suffer as a result of this policy is the U.S. industry." Netscape Communications Corp. President Jim Barksdale estimated his company will lose $40 million this year in potential export sales for encryption products. But a top official at the National Security Agency -- whose job is to break secret codes -- said the encryption "genie is not out of the bottle." NSA Deputy Director William Crowell said encryption won't be widely used until it is marketed and sold, with support to help people use it. "The administration's proposal is not designed to keep the plug in the bottle, but to help provide a full range of trusted security services," Crowell said. Industry executives also said use of the decoding keys would be costly and raises questions about government access to private business and personal information, such as bank and medical records. "Keys can be compromised in many ways. They can be stolen, revealed by disgruntled employees or obtained through bribery, Pieper said. -----