Techno-Crime in America: New Opportunities, Techniques, Offenders, and Victims

1. Techno-Crime in America: New Opportunities, Techniques, Offenders, and Victims Lecture: September 14, 2010 Professor James Byrne

2. New Opportunities for Crime • The old world adage still applies – crime follows opportunity. • New technologies create provide new opportunities for crime. • Today, computers provide new opportunities for crime and victimization • Almost a century ago, it was the invention of the car

3. Cars and Criminal Opportunity: A Case Study • In the 1920s private cars became widely affordable. This technology embodied the following characteristics: • - affordability – wide spread across socio-economic groups • - speed – cars were much faster than any previously available private transport (ie the horse) • - distance – cars could travel long distances without resting (like a horse would have to) • - carrying capacity – cars could carry much more than a horse • - anonymity – occupants of a car could not be as easily recognized as someone on horseback or on foot.

4. Cars and Crime • The result was significant growth in certain types of crime, including: • - bank robberies and housebreaking; • - abduction; • - smuggling and other transport of illicit goods; • and new crimes: theft of cars themselves.

5. Cars and Criminal justice • NEW regulatory and law enforcement countermeasures included: • - introduction of number plates, chassis and engine serial numbers; • - introduction of motorcycle police and patrol and pursuit cars; • - improved premises security including burglar alarms and security patrols; and • - improved cross – jurisdictional arrangements. • Some of the countermeasures were aimed at specifics new crimes, BUT most were aimed at counteracting old crimes using new technology.

6. Computers and Criminal Opportunity • E-commerce is –global; accessible; automated, immediate; capable of operating without the “collateral info” we have all relied upon in the past; can be hidden from scrutiny through encryption and all these things together create new business models – new ways of doing business. • electronic crime IS AN OUTGROWTH OF E-commerce: • - global; criminals can operate around the world literally; • - accessible in ways never before seen and to people who, in the past, may never have led lives of crime; • - automated • - lots of small crimes can be effected wherein the past that would have been all too hard; • - immediate- criminals can move fast!; • - anonymous, or as good as; OFFENDERS ARE HIDDEN.

7. The Link Between E-Commerce and Electronic Crime • E-Crime is a variation on an old theme– old scams, old crimes done in new ways. • So, just as the motor car became a vehicle for facilitation of crime – COMPUTERS are now used by criminals. • But then, that is the risk run every time a new technological development occurs. • In commercial terms, crime is a risk of doing business and it requires risk management. Not risk elimination, but management.

8. Categories of Computer Crime • 1. The Computer is the instrument to commit the crime: e.g.credit card fraud • 2. The Computer is the target of the offense: e.g. theft of data files, personal info. • 3. The Computer is incidental to the offense: e.g. telemarketing fraud

9. New Technology of Crime New Technology of Crime: A Brief Overview • Check and Credit Card Fraud • Clandestine Drug Labs • Misuse and Abuse of 9/11 • Prescription Fraud • Rave Parties • Telemarketing Fraud • Common Fraud Schemes - FBI • Check and Credit Card Fraud • Clandestine Drug Labs • Misuse and Abuse of 9/11 • Prescription Fraud • Rave Parties • Telemarketing Fraud • Common Fraud Schemes - FBI

10. Check and Credit Card Fraud • In 2000, Visa International estimated that the yearly cost of fraud worldwide was about 0.05 cent per every dollar spent. • This small amount works out to 300 million pounds in Britain and an estimated $1 billion in the United States. • In the United States , the losses from online credit card fraud alone are estimated to reach $3.2 billion in 2007.

11. How do offenders illegally acquire checks and cards? • Altering checks and cards. Offenders can do so with the simplest equipment. However, altered checks and cards are sometimes easy to detect. • Counterfeiting checks and cards. Reasonably priced machines for embossing, encoding, and applying holograms to cards are available on the Internet. • Committing application fraud. Offenders get a checking or credit card account by using another person's identity or a fictitious one. • Stealing checks and cards through muggings, pickpocketing, theft from cars, and burglaries. • Intercepting checks and cards in the mail. • Getting another person's PIN through trickery, for example, by "shimming" (watching as the person punches in a PIN). • Manufacturing and marketing counterfeit cards via internationally organized crime rings. • Renting or selling stolen or counterfeit cards to a group of "steady customers" via locally organized crime rings. • Hacking into a retailer's customer database to get credit card numbers. • Setting up bogus websites that request credit card and other personal information.

12. New Drugs, New Crimes • Clandestine Drug Labs • Harms Caused by Clandestine Methamphetamine Labs • Clandestine methamphetamine labs cause three main types of harm: (1) physical injury from explosions, fires, chemical burns, and toxic fumes; (2) environmental hazards; and (3) child endangerment. • Party Drugs

13. New drugs, New Crimes • Rave-Related Drugs • Although ravers might use any number of legal and illegal drugs, certain drugs are most commonly associated with the rave scene. Among them are: • Ecstasy (or MDMA),† † MDMA is only one of perhaps over 200 analogues to the chemical MDA (3,4 - methylenedioxyamphetamine) (Spruit 1999). • Ketamine,†† †† Because Ketamine is used as a veterinary anesthetic, trafficking in it is often connected to burglaries of veterinary clinics and pharmacies • LSD (or "acid"), • Rohypnol, and GHB .

14. Drugs and the Internet • Nationwide in 1993, people spent an estimated $25 billion on prescription drugs in the illegal market, compared with $31 billion on cocaine, including crack. • A recent study concluded that the number of people who abuse prescription drugs each year roughly equals the number who abuse cocaine­­—about 2 to 4 percent of the population. • A variety of illegal drugs are bought and sold on the internet.

15. Prescription Fraud • People commit prescription fraud in numerous ways, including • forging prescriptions, • going to several doctors to get multiple prescriptions (termed “doctor shopping”), • and altering prescriptions to increase the quantity .

16. Fake Drugs and New Crimes • Throughout history, scam artists have sold fake remedies for various diseases. • Today, the internet is being used to sell fake drugs to cure a variety of diseases, including AIDS, and various forms of Cancer. • Internet scams also target hair loss, anti-aging, weight loss, and human growth drugs.

17. Common Fraud Schemes - FBI • Common Fraud Scams- Telemarketing Fraud- Fraud Alert - Nigerian Letter or 419 Fraud-Impersonation/Identity Fraud-Advance Fee Scheme-Health Insurance -Redemption/Strawman/Bond Fraud • Investment Related Scams- Letter of Credit Fraud- Prime Bank Note-Ponzi Scheme-Pyramid Scheme

18. New Technology and Youth Violence • Cyberstalking • Cyber child pornography • Internet-related sex crimes, including solicitation and human trafficking • Sexting

19. Reporting Computer-Related Crime • Computer intrusion (i.e. hacking) • FBI local office • U.S. Secret Service • Internet Crime Complaint Center • Password trafficking  • FBI local office • U.S. Secret Service • Internet Crime Complaint Center • Counterfeiting of currency  • U.S. Secret Service

20. Reporting Computer Crime • Child Pornography or Exploitation  • FBI local office • if imported, U.S. Immigration and Customs Enforcement • Internet Crime Complaint Center • Child Exploitation and Internet Fraud matters that have a mail nexus • U.S. Postal Inspection Service • Internet Crime Complaint Center

21. Reporting Computer Crime • Internet fraud and SPAM • FBI local office • U.S. Secret Service (Financial Crimes Division) • Federal Trade Commission (online complaint) • if securities fraud or investment-related SPAM e-mails, Securities and Exchange Commission (online complaint) • The Internet Crime Complaint Center • Internet harassment • FBI local office • Internet bomb threats • FBI local office • ATF local office • Trafficking in explosive or incendiary devices or firearms over the Internet • FBI local office • ATF local office