Closing the Net

"Closing the Net"

[Reproduced with permission from the January 1991 issue of _Reason_



magazine. A one-year subscription (11 issues) is $19.95. Copyright

1991 by the Reason Foundation, 2716 Ocean Park Blvd., Suite 1062,

Santa Monica, CA 90405. Please do not remove this header.]

Back in early February, newspapers across the country reported that

computer hackers were interfering with emergency calls over the 911

communications network. The reports said the hackers had penetrated the

system using information from a secret computer document.

The scare grew out of an indictment by a grand jury in Lockport,

Illinois. On February 7, Craig Neidorf and Robert Riggs were indicted on

seven counts of wire fraud, violation of the Computer Fraud and Abuse Act

of 1986, and interstate transportation of stolen goods.

Prosecutors alleged that Neidorf and Riggs had conspired to steal,

using fraudulent methods, a confidential and proprietary document from the

Bell South telephone company. This document, it was claimed, could allow

computer hackers to disrupt the 911 emergency network.

The arrest of Neidorf and Riggs was only the beginning. The Secret

Service, which has authority over crimes involving government computers,

had embarked on a vast, nationwide investigation of hacker activity:

Operation Sun Devil.

　

Imagine the night face of North America, shining not with cities but

with lines of light showing the transmission of data. Brightest are New

York City, the financial capital, and California, the technological

capital, with Washington, D.C., a close third. The lines that crisscross

the country are telephone wires and cables, microwave transmissions, and

packet-switching networks designed for computer communication. Here and

there, beams dart into space to reflect off satellites and back to earth.

The computer networks in this country are huge. The largest are

entities like UseNet and InterNet, which link every academic computing

center of any size and are accessible to every scientist, university

student, and faculty member in the nation. The networks also include

government-operated systems, such as MilNet, which links military computers

that do not carry confidential information. And there are the commercial

services, such as Dow Jones News/Retrieval, SportsNet, CompuServe, GEnie,

and Prodigy. CompuServe is the largest of these, with half a million

subscribers.

In addition to these massive entities are thousands of tiny bulletin

board services, or BBSes. Anyone with a computer and a modem can start a

BBS; others can then call it up and use it. BBSes offer, in miniature,

essentially the same services that the commercial nets offer: the ability

to chat with others by posting messages to an electronic bulletin board and

the ability to upload and download software and text files. There are more

than 5,000 BBSes in the United States, most of them operated for fun. Few

charge their users. In my local calling area alone, I know of BBSes for

writers, gamers, Macintosh enthusiasts, gays, and the disabled -- and I'm

sure there are others.

The vast majority of BBSes deal with unexceptional topics. But some

boards deal with questions of computer security. These attract hackers.

Naturally, hackers discuss their hobby: breaking into computers.

Usually, however, bulletin board discussions are general in nature.

Hackers are not stupid, and they know that posting credit card numbers or

the like is evidence of criminal activity. By and large, BBS discussions

rarely, if ever, contain information that would be illegal if published in

print form. It's not illegal, after all, to tell your readers how to

commit illegal acts. If it were, books like _The_Anarchist's_Cookbook_ and

_Scarne_on_Cards_ (and half the murder mysteries in print) would be banned.

The laws dealing with electronic transmissions, however, are far

from clear. And the methods used to enforce these vague laws set a

dangerous precedent for abridging freedom of speech.

In the future, the Net -- the combination of all the computer

networks -- will be the primary means of information transmission, with

print publication merely its adjunct. The Net will replace the press, and

users of the Net must enjoy precisely the freedoms enjoyed by the press.

If users of the Net have to worry about police surveillance, if censorship

is rife, if the state forbids mere discussion of certain topics -- then the

liberty for which the Founders fought will have been destroyed, not by war

or tyranny, but by mere technological change.

　

From the government's point of view, the arrest of Neidorf and Riggs

did not end the threat to the 911 network. The document they had stolen

was not a single piece of paper that could be returned to its rightful

owner. It was an electronic document that Riggs had downloaded from a Bell

South computer.

Riggs belonged to a hacker group called the Legion of Doom, whose

members shared information. It was likely that others in the group had

copies of the 911 document. Worse, Riggs had uploaded the 911 document to

a bulletin board service in Lockport, Illinois. Neidorf had downloaded the

file from the Lockport BBS. Anyone else who used the same BBS could have

downloaded it, too, meaning that dozens of people might have this dangerous

information. Worse yet, Neidorf had published an edited version of the

Bell South document in an issue of his underground computer magazine,

_Phrack_.

Unlike conventional magazines, _Phrack_ never saw a printing press;

it was distributed electronically. After preparing an issue, Neidorf would

dispatch it, via various computer networks, to his address list of 1,300

names. Any recipient could then upload the magazine to a bulletin board or

to one of the academic or commercial nets. That meant thousands, perhaps

millions, of people had access to the information in the Bell South

document.

We may imagine that the Secret Service was gravely concerned about

the potential threat to emergency services. If not, then their subsequent

actions are hard to fathom.

　

On March 1, 1990, employees of Steve Jackson Games, a small game

company in Austin, Texas, arrived at their place of business to find that

they were barred from the premises. The Secret Service had a warrant, and

the agents conducting the search wouldn't let anyone in until they were

done.

The agents ransacked the company's offices, broke a few locks, and

damaged some filing cabinets. They searched the warehouse so thoroughly,

says company founder Steve Jackson, that afterward it "looked like a

snowstorm," with papers strewn randomly. The agents confiscated three

computers, a laser printer, several pieces of electronic equipment

(including some broken equipment from a storeroom), several hard drives,

and many floppy disks. They told Jackson they were seizing the equipment

"as evidence" in connection with a national investigation.

Among the equipment seized was the computer through which S.J. Games

ran a BBS to communicate with customers and freelancers. It had never been

a congregating point for hackers and was about as much a threat to the

public order as a Nintendo game.

The loss of the equipment was bad enough. Worse, the Secret Service

seized all existing copies -- on hard drives, floppy disks, and paper -- of

S.J. Games' next product, a game supplement called GURPS Cyberpunk. The

loss of that data shot Jackson's publication schedule to hell. Like many

small publishers, S.J. Games runs on tight cash flow. No new products, no

income. No income, no way to pay the bills.

Over the next several weeks, Jackson was forced to lay off about

half of his 17 employees. By dint of hard work, he and his staff managed

to reproduce the data they'd lost, mostly from memory. S.J. Games finally

published GURPS Cyberpunk as "The Book Seized by the Secret Service." It

has sold well by the (low) standards of the field.

Jackson estimates the raid has cost him more than $125,000, a sum a

small company like his can ill afford. (The company's annual revenue is

less than $2 million.) He was nearly put out of business by the Secret

Service.

What justified the raid and the seizures? Apparently, this: The

managing editor of Steve Jackson Games is Loyd Blankenship. Blankenship

ran The Phoenix Project, a BBS of his own in the Austin area. Blankenship

consorted with hackers. He was fascinated by the computer underground and

planned to write a book about it. He may or may not have once been a

hacker himself. He certainly knew and corresponded electronically with

admitted members of the Legion of Doom.

But perhaps Blankenship's worst luck was this: An issue of

Neidorf's _Phrack_ magazine included an article titled "The Phoenix

Project." As it happens, that article had nothing to do with Blankenship's

BBS of the same name. But the Secret Service was well aware of the

contents of _Phrack_. Indeed, the revised indictment of Neidorf and Riggs,

issued in July, cited the article by title. The same morning that the

Secret Service raided Steve Jackson Games, agents awakened Blankenship and

held him at gunpoint as they searched his house. They seized his computer

and laser printer as "evidence."

Consider the chain of logic here. Robert Riggs is accused of a

crime. Riggs belongs to a group. Loyd Blankenship is friends with other

members of the group, though not with Riggs himself. Steve Jackson Games

employs Blankenship. Therefore, the Secret Service does grievous financial

injury to Steve Jackson Games. This is guilt by association taken to an

extreme.

Neither Blankenship, nor Steve Jackson Games, nor any company

employee, has ever been charged with so much as spitting in a public place.

The Secret Service refuses to comment, saying only that S.J. Games was not

a target of the investigation.

The company is now receiving legal help from the Electronic Frontier

Foundation, an organization devoted to promoting civil liberties in

electronic media. The Secret Service has returned most -- but not all --

of the company's seized equipment. Some of it is broken and irreparable.

The government has made no offer of restitution or replacement.

　

On May 8, 1990, the Secret Service executed 28 or more search

warrants in at least 14 cities across the country. The raids involved more

than 150 agents, plus state and local law enforcement personnel.

According to a press release from the U.S. Attorney's office in

Phoenix, the operation targeted "computer hackers who were alleged to have

trafficked in and abused stolen credit card numbers [and] unauthorized

long-distance dialing codes, and who conduct unauthorized access and damage

to computers." The agency claimed the losses might amount to millions of

dollars. In later releases and news reports, that figure was inflated to

tens of millions of dollars.

Nationwide, the government seized at least 40 computers and 23,000

disks of computer information. In most cases, the subjects of these

searches have remained anonymous. Presumably, they have either been

advised by counsel to remain silent or have been so intimidated that they

wish to attract no further attention.

John Perry Barlow reports in _Whole_Earth_Review_ that the Secret

Service held families at gunpoint while agents charged into the bedrooms of

teenage hacker suspects. He adds that some equipment seizures deprived

self-employed mothers of their means of support. These reports remain

unconfirmed. It's clear, however, that the Secret Service closed down a

number of BBSes by the simple expedient of seizing "as evidence" the

computers on which those BBSes operated.

Bulletin board services are venues for speech. They are used mainly

to exchange information and ideas. Nothing in the nature of the technology

prevents the exchange of illegal ideas. But in a free society, the

presumption must be that, in absence of proof to the contrary, the use of a

medium is legitimate. The Secret Service has not indicted, let alone

convicted, the operators of any of the BBSes closed down on May 8.

If law enforcement officials suspect that a magazine, newspaper, or

book publisher may be transmitting illegal information, they get a warrant

to search its files and perhaps a restraining order to prevent publication.

They don't, however, seize its printing presses to prevent it from

operating. A clearer violation of freedom of the press could hardly be

imagined. Yet that is precisely what the Secret Service has done to these

BBSes.

One of the BBSes closed down was the JolNet BBS in Lockport,

Illinois, which Neidorf and Riggs had used to exchange the 911 document.

Ironically, JolNet's owner, Richard Andrews, had triggered the

investigation by noticing the document, deciding it was suspicious, and

notifying the authorities. He had cooperated fully with the investigators,

and they rewarded him by seizing his equipment.

　

The Ripco BBS in Chicago was among those raided by the Secret

Service. Operated by Bruce Esquibel under the handle of "Dr. Ripco," it

was a freewheeling, wide-ranging board, one of the best known BBSes in the

Chicago area. Speech was extraordinarily free on the Ripco board.

"I felt that any specific information that could lead to direct

fraud was not welcome and would be removed, and persons who repeated

violating this themselves would be removed from the system also," Esquibel

writes. But just about anything else was open for discussion. Hackers did

indeed discuss ways of breaking into computers. And the Ripco board

contained extensive text files, available for downloading, on a variety of

subjects to which some might take exception. For instance, there was a

series of articles on bomb construction -- material publicly available from

books such as _The_Anarchist's_Cookbook_.

Along with the computer on which Ripco operated, the Secret Service

seized two other computers, a laser printer, and a 940-megabyte WORM drive,

an expensive piece of equipment. The additional seizures mystify Esquibel.

"My guess is that after examining the rat's nest of wires around the three

computers, they figured anything plugged into the power strip must have

been tied in with [the rest] in some way," he says.

The Secret Service has yet to return any of Esquibel's equipment.

He has yet to be charged with any crime, other than failure to register a

firearm. (He had three unlicensed guns at his office; he informed the

Secret Service agents of this before they began their search.) Says

Esquibel, "The government came in, took my personal property to determine

if there was any wrongdoing somewhere. It seems like a case of being

guilty until proven innocent...It's just not right...I am not a hacker; [I

don't] have anything to do with credit cards or manufactured explosives.

Until the weapons charge I never had been arrested, and even my driving

record has been clean since 1978."

It appears that the Secret Service has already achieved its goal.

The Ripco board was a place where "dangerous" speech took place, and the

agency closed it down. Why bother charging Esquibel with a crime?

Especially since he might be acquitted.

　

Secret Service agents searched the home of Len Rose, a computer

consultant from Baltimore, on May 8. The agents not only seized his

computers but confiscated every piece of electronic equipment in the house,

including his fax machine, along with some family pictures, several boxes

of technical books, and a box containing his U.S. Army medals.

On May 15, Rose was indicted on four counts of wire fraud, aiding

and abetting wire fraud, and interstate transportation of stolen goods.

Among other things, the indictment alleged that Rose is a member of the

Legion of Doom, a claim both he and admitted Doomsters vociferously deny.

The interstate-transportation charge is based on the fact that Rose

was in possession of source code for Unix, an operating system used by a

wide variety of minicomputers and computer workstations. (Source code is

the original text of a program.) In theory, Unix is the property of AT&T,

which developed the system. AT&T maintains that Unix is protected as a

confidential, unpublished work. In fact, AT&T has sold thousands of copies

across the country, and every systems programmer who works with Unix is

likely to have some of the source code lying around.

The wire-fraud counts are based on the fact that Rose sent a copy of

a "Trojan horse" program by electronic mail. Trojan horse programs are

sometimes used by hackers to break into computers; they are also sometimes

used by systems managers to monitor hackers who try to break in. In other

words, a Trojan horse program is like a crowbar: You can use it to break

into someone's house, or you can use it to help renovate your own house.

It has both legitimate and illegitimate uses.

Rose is a computer consultant and has dealt with security issues

from time to time. He maintains that his Trojan horse program was used

solely for legitimate purposes -- and, in any case, would no longer work,

because of changes AT&T has made to Unix since Rose wrote the program.

Rose is not charged with actually attempting to break into computers,

merely with possessing a tool that someone could use to break in. In

essence, the Secret Service found Len Rose in possession of a crowbar and

is accusing him of burglary.

By seizing Rose's equipment, the Secret Service has effectively

denied him his livelihood. Without his equipment, he cannot work. Rose

says he has lost his home, his credit rating and credit cards, his

business, and some of his friends. He can no longer afford to retain his

original attorney and is now represented by a public defender.

Rose's difficulties are compounded by a theft conviction arising

from a dispute with a former client regarding the ownership of computer

equipment. Nevertheless, it seems brutal for the Secret Service to deny

him the means to support his family and to pay for an effective defense.

Investigators must long ago have gleaned whatever evidence his equipment

may have contained.

　

Ultimately, the case against Neidorf and Riggs fell apart. In June,

the grand jury issued a revised indictment. It dropped the charges of

violating the Computer Fraud and Abuse Act and added seven new counts of

wire fraud, some involving electronic mail between Neidorf and Riggs.

Neidorf was charges with two counts of wire fraud for uploading issues of

_Phrack_ to JolNet. In other words, mere distribution of his publication

was deemed to be "fraud" because _Phrack_ contained material the Secret

Service claimed had been obtained by fraudulent means. The new indictment

also reduced the "value" of the document Riggs allegedly stole from more

than $70,000 to $20,000.

On July 9, Riggs pleaded guilty in a separate indictment to one

count of conspiracy in breaking into Bell South's computer. Sentencing was

set for September 14 -- after Neidorf's trial was to begin. Riggs agreed

to be a witness for the prosecution of Neidorf.

On July 28, Neidorf's trial began in Chicago. Within four days, it

was over. The prosecution's case had collapsed.

Under cross-examination, a Bell South employee admitted that the

stolen document was far from confidential. Indeed, any member of the

public could purchase a copy by calling an 800 number, requesting the

document, and paying $13 -- far less than the $20,000 claimed value or the

$5,000 minimum required to support a charge of transporting stolen goods

across state lines.

Testimony also revealed that the contents of the document could not

possibly allow someone to enter and disrupt the 911 network. The document

merely defined a set of terms used in telecommunications and described the

procedures used by Bell personnel in setting up a 911 system.

Riggs, testifying for the prosecution, admitted that he had no

direct knowledge that Neidorf ever gained illegal access to anything; that

Neidorf was not himself a member of the Legion of Doom; and that Neidorf

had not been involved in the initial downloading of the document in any

way.

In short, Neidorf and Riggs had not conspired; therefore, Neidorf

should not have been charged with the fraud counts. The only value of

which Bell South was "deprived" by Riggs's downloading was $13; therefore,

he was, at worst, guilty of petty theft. The interstate-transportation

counts were moot, since the "stolen goods" in question were worth less than

the $5,000 minimum.

Not only was there no case against Neidorf -- there also was no case

against Riggs. The government dropped the case against Neidorf. Riggs,

however, had already pleaded guilty.

　

The computer nets do need policing. Computer crooks can steal and

have stolen millions of dollars. But a balance must be struck between

civil liberties and the legitimate needs of law enforcement. The laws as

currently constituted are inadequate from both perspectives, and the Secret

Service seems determined to interpret them with a callous disregard for

civil liberties.

To attack computer crime, prosecutors primarily use the statutes

dealing with wire fraud and interstate transportation of stolen goods, the

Computer Fraud and Abuse Act of 1986, and the Electronic Communication

Privacy Act of 1986. The wire fraud statute prohibits the use of the

telephone, wire services, radio, and television in the commission of fraud.

The courts have, logically, interpreted it to apply to electronic

communications as well.

The interstate transportation statute prohibits transportation of

stolen goods valued at $5,000 or more across state lines. Neidorf's lawyer

moved to dismiss those counts, claiming that nothing tangible is

transported when a document is uploaded or downloaded. The judge ruled

that tangibility was not a requirement and that electronic transmission

could constitute transportation. The Computer Fraud and Abuse Act

prohibits knowingly, and with intent to defraud, trafficking in information

that can be used to gain unauthorized access to a computer.

The Electronic Communications Privacy Act makes it a crime to

examine private communications transmitted electronically. Among other

things, it requires law enforcement agencies to obtain search warrants

before opening electronic mail. It is unclear whether electronic mail

files on a BBS's hard drive are covered by a warrant that permits seizure

of the hard drive, or whether separate warrants are needed for each

recipient's mail.

The reliance on fraud statutes to fight computer crime presents

problems. Fraud is the use of chicanery, tricks, or other forms of

deception in a scheme to deprive the victim of property. Most attempts by

hackers to gain illegal access to a computer do involve chicanery or

tricks, in some sense -- the use of other people's passwords, the use of

known bugs in systems software, and so on. Much of the time, however, a

hacker does not deprive anyone of property.

If the hacker merely signs on and looks around, he deprives the

computer operators of a few dollars of computer time at worst. If he

downloads a file, the owner still has access to the original file. If the

file's confidentiality has value in itself -- as with a trade secret --

downloading it does deprive the owner of something of value, but this is

rarely the case.

We need a "computer trespass" statute, with a sliding scale of

punishments corresponding to the severity of the violation. Just as

burglary is punished more severely than trespass, so a hacker who steals

and uses credit card numbers ought to be punished more severely than one

who does nothing more than break into a computer and examine a few public

files. In the absence of such a scheme, law enforcement personnel

naturally try to cram all computer violations into the category of fraud,

since the fraud statutes are the only laws that currently permit

prosecution of computer crimes. As a result, petty crimes are charged as

felonies -- as with Neidorf and Riggs.

　

Legitimate users and operators of computer networks need to be

protected from arbitrary seizures and guilt by electronic association. The

criminal code permits law enforcement personnel to seize equipment used in

a crime or that might provide criminal evidence, even when the owner has no

knowledge of the crime. But the purpose of such seizures is to allow the

authorities access to evidence of criminal activity, not to shut down

businesses. Searchers need not remove computer equipment to inspect the

files it contains. They can sit down and make copies of whatever files

they want on the spot. Even if they expect some piece of incriminating

material to be hidden particularly well -- for example, in a specially

protected file or in a ROM chip -- it is unreasonable to hold onto the

seized equipment indefinitely.

And it's clearly wrong to seize equipment that cannot, by any

stretch of the imagination, contain incriminating data. In both the Steve

Jackson and Ripco cases, the Secret Service seized laser printers along

with other equipment. Laser printers have no permanent memory (other than

the factory-supplied ROM chips that tell them how to operate). They print

words on paper, that's all. They cannot contain incriminating information.

Even computers themselves cannot possibly constitute evidence. When

you turn off a computer, its memory dies. Permanent data exist only on

storage media -- hard drives, floppy disks, tape drives, and the like.

Even if law enforcement personnel have some compelling reason to take

storage media away to complete a search, they have no reason to take the

computers that use those media.

Just as a computer is not evidence because it once carried

incriminating information, a network is not a criminal enterprise because

it once carried data used in or derived from fraudulent activity. Yet

under current law, it seems that the operator of a bulletin board is liable

if someone posts an illegal message on it. Say I run a BBS called Mojo.

You dial Mojo up and leave Mario Cuomo's MasterCard number on the board,

inviting anyone to use it. Six people sign on, read the message, and fly

to Rio courtesy of the governor before I notice the message and purge it.

Apparently, I'm liable -- even though I had nothing to do with obtaining

Cuomo's credit card number, never used it, and strenuously object to this

misuse of my board.

Such an interpretation threatens the very existence of the academic

and commercial nets. A user of UseNet, for instance, can send a message to

any other user of UseNet. The network routes messages in a complex fashion

-- from Computer A to Computer B to Computer C, and so on, depending on

what computers are currently live, the volume of data transmitted among

them, and the topography of the net itself. The message could pass through

dozens of computers before reaching its destination. If someone uses the

message to commit fraud, the system operators of every computer along its

path may be criminally liable, even though they would have no way of

knowing the contents of the message.

Computer networks and BBSes need the same kind of "common carrier"

protection that applies to the mails, telephone companies, and wire

services. Posting an illegal message ought to be illegal for the person

who posts it -- but not for the operator of the board on which the message

appears.

The main function of the Net is to promote communication. People

use it to buy goods, research topics, download software, and a myriad of

other things as well, but most of their computing time is spent

communicating: by posting messages to bulletin boards, by "chatting" in

real time, by sending electronic mail, by uploading and downloading files.

It makes no sense to say that discussion of a topic in print is OK, but

discussion of the same topic via an electronic network is a crime.

Yet as currently interpreted, the law says that mere transmission of

information that someone _could_ use to gain access to computers for

fraudulent purposes is itself fraud -- even if no fraudulent access takes

place. The Secret Service, for instance, was willing to indict Neidorf for

publishing information it thought could be used to disrupt the 911 network

-- even though neither Neidorf nor anyone else actually disrupted it. We

must clearly establish that electronic communications are speech, and enjoy

the same protections as other forms of speech.

The prospects for such legal reform are not bright. Three times in

this century, technological developments have created new venues for

speech: with radio, with television, and with cable. On the grounds of

scarcity, government restricts freedom of speech on radio and television;

on the grounds of natural monopoly, government regulates speech on cable.

Recent events, such as the conviction of former Cornell graduate student

Robert T. Morris for introducing a virus into the nationwide ARPANet, have

aroused worry about hacker crimes. But concern for the rights of

legitimate users of computer nets has not received that same level of

publicity. If anything, recent trends lean toward the adoption of more

draconian laws -- like the Computer Fraud and Abuse Act, which may make it

illegal even for computer security professionals to transmit information

about breaches of security.

　

The Net is vast -- and growing fast. It has already changed the

lives of thousands, from scientists who learn of new breakthroughs far more

quickly than if they had to wait for journal publication, to stay-at-home

writers who find in computer networks the personal contact they miss

without office jobs. But the technology is still in its infancy. The Net

has the capacity to improve all our lives.

A user of the Net can already find a wide variety of information,

from encyclopedia entries to restaurant reviews. Someday the Net will be

the first place citizens turn to when they need information. The morning

paper will be a printout, tailored to our interests and specifications, of

articles posted worldwide; job hunters will look first to the Net; millions

will use it to telecommute to work; and serious discussion will be given to

the abolition of representative government and the adoption of direct

democracy via network voting.

Today, we are farmers standing by our country lanes and marveling as

the first primitive automobiles backfire down the road. The shape of the

future is murky. We cannot know what the Net will bring, just as a farmer

seeing a car for the first time couldn't possibly have predicted six-lane

highways, urban sprawl, the sexual revolution, and photochemical smog.

Nonetheless, we can see that something remarkable is happening, something

that will change the world, something that has the potential to transform

our lives. To ensure that our lives are enriched and not diminished, we

must ensure that the Net is free.

　

-- Greg Costikyan is a writer of fiction and nonfiction who has designed 23

commercially published games.