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Computer Crime and
Intellectual Property Section (CCIPS) 

Prosecuting Crimes Facilitated by Computers and by the Internet

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  1. Computer Facilitated Crime Cases
  2. Ways Computers Can Be Used In Crimes
  3. The Rising Tide of Internet Fraud, Jonathan Rusch, USA Bulletin (May 2001)
  4. Tracing in Internet Fraud Cases: PairGain and NEI Worldweb, Christopher M.E. Painter, USA Bulletin (May 2001)
  5. Internet Gambling
  6. Cyberstalking and Harassing Speech
  7. Executive Order on Unlawful Conduct Using the Internet
  8. Child Pornography
  9. Sale of Prescription Drugs Over the Internet
  10. Identity Theft: The Crime of the New Millennium, Sean B.Hoar, USA Bulletin
    (March 2001)
Many crimes that are not specifically related to computers can be substantially facilitated by the use of computers. The easy access of cyberspace can provide a low-cost high-connectivity way for criminals to reach victims.


A. Computer Facilitated Crime Cases

Computers can be used in a variety of roles in crimes. Each of these roles can raise novel investigative and prosecutorial issues because of the unique attributes of computers. Cases exemplify this trend are listed below.

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B. Ways Computers Can Be Used In Crimes
Computers can be used in a variety of roles in crimes. Each of these roles can raise novel investigative and prosecutorial issues because of the unique attributes of computers. Testimony and speeches by Assistant Attorney General for the Criminal Division James K. Robinson, FBI Director Louis Freeh, Deputy Attorney General Eric H. Holder, Jr., and others about the roles computers can play in crime are provided via the links below:

C. The Rising Tide of Internet Fraud, Jonathan Rusch, USA Bulletin (May 2001)

By all accounts, the United States leads the world in using the Internet for commerce and communication, and in spending on electronic commerce. There are growing indications that along with the expansion of legitimate Internet use, the United States is experiencing a rising tide of fraud that exploits the Internet.

Additional information on this subject is available via the link below.

D. Tracing in Internet Fraud Cases: PairGain and NEI Worldweb, Christopher M.E. Painter, USA Bulletin (May 2001)

Fraud, including stock manipulation and the full panoply of other deceitful schemes, has found a comfortable home on the Internet. Many of these crimes are simply age-old schemes being committed over a new medium -- so called old wine in new bottles. Others, like Internet auction fraud or the easy dissemination of digital copyrighted works, are novel and have been spawned by the new technology. In either case, crimes committed over the Internet pose special challenges for law enforcement.

Additional information on this subject is available via the link below.

E. Internet Gambling

1.    Federal Legislation Related to Internet Gambling

On April 29, 2003, Deputy Assistant Attorney General John G. Malcolm testified before the U.S. House of Representatives Subcommittee on Crime, Terrorism, and Homeland Security Committee on the Judiciary. In his testimony, Mr. Malcolm offered the views of the Department of Justice about Internet gambling, including the potential for gambling by minors and compulsive gamblers, the potential for fraud and money laundering, and the potential for infiltration by organized crime. Mr. Malcom's testimony addressed the Department's concerns, with respect to H.R. 1223, about the feasibility and desirability of regulating Internet gambling. He expressed several of the Department's concerns with respect to H.R. 21, including the concern that this bill should be drafted to apply to all unlawful Internet gambling regardless of the communications medium used to place bets.

Kevin V. Di Gregory, Deputy Assistant Attorney General, testified before the House of Representatives Committee on Banking and Financial Services on June 20, 2000 on Gambling on the Internet.  As with earlier testimony, this statement addressed the Department of Justice's concerns with proposed Internet gambling legislation and the problems inherent in creating a solution that is not technology-neutral.

Kevin V. Di Gregory, Deputy Assistant Attorney General, testified before the Subcommittee on Crime, of the House Committee on the Judiciary on March 9, 2000 on Internet Gambling.  His testimony addressed the Department of Justice’s concerns with proposed Internet gambling legislation that would effectively expand legal gambling.  He also expressed the Department’s concern with creating an inconsistent regulatory scheme that would result in the same conduct being treated differently over the telephone, the Internet, and other technologies. Kevin V. Di Gregory, Deputy Assistant Attorney General, Department of Justice, testified before the Senate Committee on Indian Affairs on June 9, 1999 regarding Internet Gambling and Indian Gaming.  His testimony addressed two issues: (1) the Department of Justice's support of efforts to amend federal gambling statutes to ensure that these gambling activities made possible by the Internet are prohibited; and (2) the Department's belief that any law prohibiting Internet gambling should not conflict with the rights or privileges of Indian tribes, both as sovereigns and under the Indian Gaming Regulatory Act (IGRA).  Also linked below is a letter from the Department of Justice to Senator Patrick J. Leahy, Ranking Minority Member, Senate Judiciary Committee, regarding the Internet Gambling Prohibition Act of 1999. Kevin V. Di Gregory, Deputy Assistant Attorney General, Department of Justice, testified regarding Gambling on the Internet before the Subcommittee on Crime, of the House Committee on the Judiciary, on June 24, 1998.  His testimony addressed law enforcement concerns as they relate to development of the Nation’s policy toward gambling and, more particularly, the effectiveness of existing state and federal laws for prosecuting various forms of Internet gambling.  It also identifies important characteristics that legislation pertaining to the transmission of information over the Internet should have.  His testimony is available via the link below, along with questions and answers regarding prosecution of gambing and the Internet:       Questions and answers:  2.    Prosecution of Internet Gambling

On February 28, 2000, Jay Cohen was convicted in Manhattan federal court of operating a sports betting business that illegally accepted bets and wagers on sporting events from Americans over the Internet and telephones.  Cohen is the first defendant to stand trial in a series of  Internet offshore sports gambling cases that were the first prosecutions brought under the federal Wire Wager Act.

In New York, twenty-one owners, managers and employees of Internet sports betting companies have been charged in Manhattan federal court with conspiracy to transmit bets and wagers on sporting events via the Internet and telephones. Information about the filing of these charges is available below.

 3.    Gambling Against Enforcement—Internet Sports Books and the Wire Wager Act, Joseph V. DeMarco, USA Bulletin (March 2001)

Even as a certain "Madness" crowds network airwaves during the month of March, and as Americans gamble in various forms in ever-increasing numbers, gambling on sporting events is strictly regulated and, in most cases, prohibited outright under federal and state law. Notwithstanding these general prohibitions, however, the exponential growth in the use of the Internet by the mass public has been accompanied by a corresponding growth in the creation of Internet websites which offer Americans the ability to gamble on-line without the need for a neighborhood bookie. From on-line private lotteries, to on-line card games, "quiz shows," and traditional sports books, these websites offer privacy and anonymity to both the owners of the sites and their "clients" while, paradoxically, offering a perceived aura of legitimacy that derives from the fact that anyone can "sign on" to and use them as freely as any legitimate e-commerce site.

Additional information on this subject is available via the link below.


F. Cyberstalking and Harassing Speech

Cyberstalking

On April 21, 2000, Lynne A. Battaglia, United States Attorney for the District of Maryland, announced that Warren Gray, a 19-year old Upper Marlboro, Maryland man, pleaded guilty to five counts of sending threatening e-mails to a Largo High School administrator at the same time as Gray was stalking him last November.

The rapid growth of the Internet and other telecommunications technologies are promoting advances in virtually every aspect of society and every corner of the globe. Most of these advances represent positive changes in our society. Unfortunately, many of the attributes of this technology - low cost, ease of use, and anonymous nature, among others - make it an attractive medium for fraudulent scams, child sexual exploitation, and increasingly, a new concern known as "cyberstalking." Recognizing this emerging problem, Vice President Al Gore asked the Attorney General on February 26, 1999, to study the problem and to report back with recommendations on how to protect people from this threat. The report can be found by following the link below: On April 21, 1999, Carl Edward Johnson, 49, of Bienfait, Saskatchewan, Canada, was convicted on four felony counts of sending threatening e-mail messages via the Internet to federal judges and others.  The charges were based on death threats posted to the Internet naming two federal judges based in Tacoma and Seattle and on an e-mail threat sent directly to Microsoft Chairman Bill Gates.  Although Johnson had used anonymous remailers and forged e-mail address information in an attempt to disguise his identity, Judge Bryan found that the Government's technical evidence proved Johnson’s authorship.  On June 11, 1999, Johnson was sentenced to thirty-seven months of imprisonment for his crimes.


Harassing Speech

On October 16, 1998, an individual pleaded guilty in the Eastern District of Virginia to a felony for repeatedly causing e-mail to be transmitted over the Internet solely with the intent to harass another individual. Additional information regarding this case is available via the link below:


 G.  Executive Order on Unlawful Conduct Using the Internet
On March 9, 2000, Attorney General Janet Reno announced the release of "The Electronic Frontier: the Challenge of Unlawful Conduct Involving the Use of the Internet."
In August 1999, President Clinton established an interagency Working Group on Unlawful Conduct on the Internet.  Executive Order 13,133 directed the Working Group, under the leadership of the Attorney General, to prepare a report with recommendations on:
    --The extent to which existing federal laws provide a sufficient basis for effective investigation and prosecution of unlawful conduct that involves the use of the Internet;
    --The extent to which new technology tools, capabilities, or legal authorities may be required for effective investigation and prosecution of unlawful conduct that involves the use of the Internet;  and
    --The potential for new or existing tools and capabilities to educate and empower parents, teachers, and others to prevent or to minimize the risks from unlawful conduct that involves the use of the Internet.
The report and its appendices can be found via the links below: On August 5, 1999, President Clinton issued Executive Order 13133, which established a Working Group to analyze the existence of unlawful conduct on the Internet and to prepare and report recommendations based on its findings within 120 days. The specific topics that the group will be addressing include the extent to which existing Federal laws provide a sufficient basis for effective investigation and prosecution of unlawful conduct that involves the Internet; the extent to which new tools, capabilities, or authorities may be required for effective investigation and prosecution of Internet crime; and the potential for educating and empowering parents, teachers and others to prevent or minimize risks from such unlawful conduct. The Executive Order and related documents are available below:
H.  Child Pornography
On September 29, 1999, Deputy Attorney General Eric Holder gave remarks on "Combating Child Pornography on the Internet" at Vienna, Austria International Child Pornography Conference. The conference sought to combat child pornography and exploitation on the Internet and was based on existing international obligations and committments for the protection of children, including the Conventionon the Rights of the Child. The conference built and acted upon commitments undertaken at the Stockholm World Congress against the Commercial Sexual Exploitation of Children (1996) and ongoing initiatives in many countries and regions.
I.   Sale of Prescription Drugs Over the Internet
On October 25, 2000, a New Jersey man pleaded guilty to one count of fraud.  The man, Stanley Lapides, admitted to selling via the Internet home HIV test kits.  However, Lapides neglected to tell his customers that these kits had not yet been approved for use by the FDA. On May 25, 2000, Deputy Associate Attorney General Ethan M. Posner testified before the Subcommittee on Oversight and Investigations of the House Committee on Commerce on the subject of Online Pharmaceutical Drug Sales.  His testimony detailed the role of the Department of Justice in Internet drug sales, including current specific efforts by the Department and information on the Internet Prescription Drug Sales Act of 2000. On December 9, 1999, a federal grand jury charged Kent Aoki Lee with selling Viagra over the Internet without a prescription.  Lee was also charged with wire fraud and trademark violations growing out of his operation of a separate pirated Internet website. Ivan K. Fong, Deputy Associate Attorney General, Department of Justice, testified before the Subcommittee on Oversight and Investigations, Committee of Commerce of the United States House of Representatives regarding Sale of Prescription Drugs over the Internet on July 30, 1999.


J.  Identity Theft: The Crime of the New Millennium, Sean B.Hoar, USA Bulletin (March 2001)

Identity theft has been referred to by some as the crime of the new millennium. It can be accomplished anonymously, easily, with a variety of means, and the impact upon the victim can be devastating. Identity theft is simply the theft of identity information such as a name, date of birth, Social Security number (SSN), or a credit card number. The mundane activities of a typical consumer during the course of a regular day may provide tremendous opportunities for an identity thief: purchasing gasoline, meals, clothes, or tickets to an athletic event; renting a car, a video, or home-improvement tools; purchasing gifts or trading stock on-line; receiving mail; or taking out the garbage or recycling. Any activity in which identity information is shared or made available to others creates an opportunity for identity theft.

Additional information on this subject is available via the link below.

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