==Phrack Magazine==

                 Volume Six, Issue Forty-Seven, File 22 of 22

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3 Residents Investigated In Theft Of Phone Card Numbers            Oct 10, 1994
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Russ Britt (Los Angeles Daily News)

Three Los Angeles residents have come under investigation in connection with
the theft of 100,000 telephone calling card numbers used to make $50 million
worth of long distance calls, officials said.

The Secret Service searched the suspects' residences over the past two weeks
and found computer disks containing calling card codes, said Jim Bauer,
special agent-in-charge of he Los Angeles office.

Ivy J. Lay, an MCI switch engineer based in Charlotte, N.C., was arrested
last week in North Carolina on suspicion of devising computer software to hold
calling card numbers from carriers that route calls through MCI's equipment,
the Secret Service said.

Lay is suspected of supplying thousands cards of calling codes to accomplices
in Los Angeles for $3 to $5 a number, Bauer said.  The accomplices are
suspected of reselling the numbers to dealers in various cites, who then sold
them to buyers in Europe, Bauer said.

European participants would purchase the numbers to make calls to the United
States to pirate computer software via electronic bulletin boards.

-------------------------------------------------------------------------------

Revealed: how hacker penetrated the heart of British intelligence  Nov 24, 1994
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Tim Kelsey (The Independent) p. 1

[ In typical British style, The Independent boasts 3 FULL pages on the
  story of how a "hacker" broke into British Telecom's databases and pulled
  information regarding sensitive numbers for the Royal Family and
  MI 5 & 6.

  Reportedly, information was sent anonymously to a reporter named Steve
  Fleming over the Internet by a "hacker" who got a job as a temp at BT
  and used their computers to gather the information.  (I heard that Fleming
  later admitted that "he" was actually the supposed "hacker.")

  This is news?  This is like saying, "Employees at Microsoft gained access to
  proprietary Microsoft source code," or "CAD Engineers at Ford gained
  access to super-secret Mustang designs."  Get real. ]

-------------------------------------------------------------------------------

Telecom admits security failings                                   Nov 29, 1994
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Tim Kelsey (The Independent) p. 1

[ In typical British style, senior officials at BT attempted to save face
  by stating that sensitive information such as the file of Royal Family
  and Intelligence services phone numbers and addresses (currently floating
  around the Internet) was safe from prying eyes, but could indeed be accessed
  by BT employees.  Uh, yeah. ]

-------------------------------------------------------------------------------
Phreak Out!                                                            Dec 1994
~~~~~~~~~~~
by Steve Gold (Internet and Comms Today) p. 44

[ A valiant attempt by England's Internet & Comms Today (my favorite
  Internet-related magazine--by far) to cover the Hack/Phreak scene
  in the UK, with a few tidbits about us here in the states.  Not
  100% accurate, but hell, it beats the living shit out of anything
  ever printed by any US mainstream mag. ]

-------------------------------------------------------------------------------

Hack To The Future                                                     Dec 1994
~~~~~~~~~~~~~~~~~~
by Emily Benedek (Details) p. 52

Hacking Vegas                                                          Jan 1995
~~~~~~~~~~~~~
by Damien Thorn (Nuts & Volts) p. 99

[ A review of HOPE, and a review of DefCon.  One from a techie magazine whose
  other articles included:  Build a Telephone Bug, Telephone Inside Wiring
  Maintenance, Boat GPS on Land and Sea and Killer Serial Communications;
  the other from a magazine that usually smells more fragrant than Vogue, and
  whose other articles included:  The Madonna Complex, Brother From Another
  Planet, Confessions of a Cyber-Lesbian and various fashion pictorials.
  One written by someone who has been in the hack scene since OSUNY ran on an
  Ohio-Scientific and the other written by a silly girlie who flitted around
  HOPE taking pictures of everyone with a polaroid.  You get the idea. ]

-------------------------------------------------------------------------------

Hackers Take Revenge on the Author of New Book on Cyberspace Wars  Dec  5, 1994
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Jared Sandberg (The Wall Street Journal) p. B5

In his forthcoming book writer Joshua Quittner chronicles the bizarre but
true tale of a Hatfield-and-McCoys feud in the nether world of computer
hackers.

Now the hackers have extracted revenge for Mr. Quittner's attention, taking
control of his phone line and voice mail and bombarding his on-line account
with thousands of messages.

"I don't believe I've ever been hacked to this degree," says Mr. Quittner,
whose book, written with wife Michelle Slatalla, was excerpted in the
latest issue of Wired magazine, apparently prompting the attack.

"People in MOD and LOD are very unhappy about the story," Mr. Quittner says.
"That is what I believe prompted the whole thing."

-------------------------------------------------------------------------------

Terror On The Internet                                                 Dec 1994
~~~~~~~~~~~~~~~~~~~~~~
By Philip Elmer-Dewitt (Time)

Thanksgiving weekend was quiet in the Long Island, New York, home of Michelle
Slatalla and Josh Quittner. Too quiet.

"We'd been hacked," says Quittner, who writes about computers, and
hackers, for the newspaper Newsday, and will start writing for TIME in
January. Not only had someone jammed his Internet mailbox with thousands of
unwanted pieces of E-mail, finally shutting down his Internet access
altogether, but the couple's telephone had been reprogrammed to forward
incoming calls to an out-of-state number, where friends and relatives heard
a recorded greeting laced with obscenities. "What's really strange," says
Quittner, "is that nobody who phoned, including my editor and my
mother, thought anything of it. They just left their messages and hung up."

It gets stranger. In order to send Quittner that mail bomb, the electronic
equivalent of dumping a truckload of garbage on a neighbor's front lawn,
someone, operating by remote control, had broken into computers at IBM,
Sprint and a small Internet service provider called the Pipeline, seized
command of the machines at the supervisory, or "root", level, and
installed a program that fired off E-mail messages every few seconds.

Adding intrigue to insult, the message turned out to be a manifesto that
railed against "capitalist pig" corporations and accused those companies
of turning the Internet into an "overflowing cesspool of greed." It was
signed by something called the Internet Liberation Front, and it ended like
this: "Just a friendly warning corporate America; we have already stolen
your proprietary source code. We have already pillaged your million dollar
research data. And if you would like to avoid financial ruin, get the
((expletive deleted)) out of Dodge. Happy Thanksgiving Day turkeys."

It read like an Internet nightmare come true, a poison arrow designed to
strike fear in the heart of all the corporate information managers who had
hooked their companies up to the information superhighway only to discover
that they may have opened the gate to trespassers. Is the I.L.F. for real?
Is there really a terrorist group intent on bringing the world's largest
computer network to its knees?

That's what is so odd about the so-called Internet Liberation Front. While
it claims to hate the "big boys" of the telecommunications industry and
their dread firewalls, the group's targets include a pair of journalists and
a small, regional Internet provider. "It doesn't make any sense to me,"
says Gene Spafford, a computer-security expert at Purdue University.
"I'm more inclined to think it's a grudge against Josh Quittner."

That is probably what it was. Quittner and Slatalla had just finished a book
about the rivalry between a gang of computer hackers called the Masters
of Deception and their archenemies, the Legion of Doom, an excerpt of
which appears in the current issue of Wired magazine. And as it turns out,
Wired was mail-bombed the same day Quittner was, with some 3,000 copies
of the same nasty message from the I.L.F. Speculation on the Net at week's
end was that the attacks may have been the work of the Masters of Deception,
some of whom have actually served prison time for vandalizing the computers
and telephone systems of people who offend them.

-------------------------------------------------------------------------------

The Phreak Show                                                 Feb  5, 1995
~~~~~~~~~~~~~~~
By G. Pascal Zachary (Mercury News)

"Masters of Deception" provides an important account of this hidden hacker
world. Though often invoked by the mass media, the arcana of hacking have
rarely been so deftly described as in this fast-paced book. Comprised of
precocious New York City high schoolers, the all-male "Masters of Deception"
(MOD) gang are the digital equivalent of the 1950s motorcyclists who roar
into an unsuspecting town and upset things for reasons they can't even explain.

At times funny and touching and other times pathetic and disturbing, the
portrait of MOD never quite reaches a crescendo. The authors, journalists
Michelle Slatalla of Newsday and Joshua Quittner of Time, fail to convey
the inner lives of the MOD. The tale, though narrated in the MOD's
inarticulate, super-cynical lingo and packed with their computer stunts,
doesn't convey a sense of what makes these talented oddballs tick.

Too often the authors fawn all over their heroes. In "Masters of Deception,"
every hacker is a carefree genius, benign and childlike, seeking only to
cavort happily in an electronic Garden of Eden, where there are no trespassing
prohibitions and where no one buys or sells information.

Come on. Phiber and phriends are neither criminals nor martyrs. The issue of
rights and responsibilities in cyberspace is a lot more complicated than
that. Rules and creativity can co-exist; so can freedom and privacy. If
that's so hard to accept, a full 25 years after the birth of the
Internet, maybe it's time to finally get rid of the image of the hacker
as noble savage. It just gets in the way.

-------------------------------------------------------------------------------

Hacking Out A Living                                               Dec  8, 1994
~~~~~~~~~~~~~~~~~~~~
by Danny Bradbury (Computing) p. 30

There's nothing like getting it from the horse's mouth, and that's exactly
what IT business users, anxious about security, did when they went to a recent
conference given by ex-hacker, Chris Goggans.

[ Yeah, so it's a blatant-plug for me.  I'm the editor.  I can do that.
  (This was from one of the seminars I put on in Europe) ]

-------------------------------------------------------------------------------

Policing Cyberspace                                                Jan 23, 1995
~~~~~~~~~~~~~~~~~~~
by Vic Sussman (US News & World Report) p. 54

[ Yet another of the ever-growing articles about high-tech cops.  Yes, those
  dashing upholder of law and order, who bravely put their very lives
  on the line to keep America free from teenagers using your calling card.

  Not that I wouldn't have much respect for our High-Tech-Crimefighters, if
  you could ever show me one.  Every High-Tech Crime Unit I've ever seen
  didn't have any high-tech skills at all...they just investigated low-tech
  crimes involving high-tech items (ie. theft of computers, chips, etc.)
  Not that this isn't big crime, its just not high tech.  Would they
  investigate the theft of my Nientendo?  If these self-styled cyber-cops
  were faced with a real problem, such as the theft of CAD files or illegal
  wire-transfers, they'd just move out of the way and let the Feds handle
  it.  Let's not kid ourselves. ]

-------------------------------------------------------------------------------

Hacker Homecoming                                                  Jan 23, 1995
~~~~~~~~~~~~~~~~~
by Joshua Quitter (Newsweek) p. 61

The Return of the Guru                                             Jan 23, 1995
~~~~~~~~~~~~~~~~~~~~~~
by Jennifer Tanaka and Adam Rogers (Time) p. 8

[ Two articles about Mark "Phiber Optik" Abene's homecoming party.
  Amazing.  Just a few years earlier, Comsec was (I think) the first
  group of hackers to make Time & Newsweek on the same date.
  Now, all someone has to do is get out of jail and they score a similar
  coup.  Fluff stories to fill unsold ad space. ]

-------------------------------------------------------------------------------

Data Network Is Found Open To New Threat                           Jan 23, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by John Markoff (New York Times) p. A1

A Federal computer security agency has discovered that unknown intruders
have developed a new way to break into computer systems, and the agency
plans on Monday to advise users how to guard against the problem.

The first known attack using the new technique took place on Dec. 25
against the computer of a well-known computer security expert at the
San Deigo Supercomputer Center.  An unknown individual or group took
over his computer for more then a day and electronically stole a large
number of security programs he had developed.

The flaw, which has been known as a theoretical possibility to computer
experts for more than a decade, but has never been demonstrated before,
is creating alarm among security experts now because of the series of
break-ins and attacks in recent weeks.

The weakness, which was previously reported in technical papers by
AT&T researchers, was detailed in a talk given by Tsutomo Shimomura,
a computer security expert at the San Deigo Supercomputer Center, at a
California computer security seminar sponsored by researchers at the
University of California at Davis two weeks ago.

Mr. Shimomura's computer was taken over by an unknown attacker who then
copied documents and programs to computers at the University of Rochester
where they were illegally hidden on school computers.

-------------------------------------------------------------------------------

A Most-Wanted Cyberthief Is Caught In His Own Web                  Feb 16, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by John Markoff (New York Times) p. A1

After a search of more than two years, a team of FBI agents early this
morning captured a 31-year-old computer expert accused of a long crime
spree that includes the theft of thousands of data files and at least
20,000 credit card numbers from computer systems around the nation.

Federal officials say Mr. Mitnick's confidence in his hacking skills may
have been his undoing.  On Christmas Day, he broke into the home computer
of a computer security expert, Tsutomo Shimomura, a researcher at the
federally financed San Deigo Supercomputer Center.

Mr. Shimomura then made a crusade of tracking down the intruder, an obsession
that led to today's arrest.

It was Mr. Shimomura, working from a monitoring post in San Jose, California,
who determined last Saturday that Mr. Mitnick was operating through a computer
modem connected to a cellular telephone somewhere near Raleigh, N.C.

"He was a challenge for law enforcement, but in the end he was caught by his
own obsession," said Kathleen Cunningham, a deputy marshal for the United
States Marshals Service who has pursued Mr. Mitnick for several years.

-------------------------------------------------------------------------------

Computer Users Beware: Hackers Are Everywhere
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Michelle V. Rafter (Reuters News Sources)

System Operators Regroup In Wake Of Hacker Arrest
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Elizabeth Weise (AP News Sources)

Computer Hacker Seen As No Slacker
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Paul Hefner (New York Times)

Kevin Mitnick's Digital Obsession
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Josh Quittner (Time)

A Superhacker Meets His Match
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Katie Hafner (Newsweek)

Cracks In The Net
~~~~~~~~~~~~~~~~~
by Josh Quittner (Time)

Undetected Theft Of Credit-Card Data Raises Concern About Online Security
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Jared Sandberg (The Wall Street Journal)

[Just a sampling of the scores of Mitnick articles that inundated the
 news media within hours of his arrest in North Carolina.  JUMP ON THE
 MITNICK BANDWAGON!  GET THEM COLUMN INCHES!  WOO WOO!]

-------------------------------------------------------------------------------

Hollywood Gets Into Cyberspace With Geek Movies
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
By Therese Poletti (Reuters News Sources)

With dramatic tales like the capture last week of a shadowy computer hacker
wanted around the world, Hollywood studios are scrambling to cash in on
the growing interest in cyberspace.

"They are all looking at computer-related movies because computers are
hot," said Bishop Kheen, a Paul Kagan analyst. "They are all reviewing
scripts or have budgets for them. "We are going to see a rash of these
kinds of movies."

Experts say it remains to be seen what kind of box office draw can be
expected from techie movies such as one that might be based on the hunt for
Mitnick. But the recent surge of interest in the Internet, the high-profile
criminal cases, and romanticized images of hackers may fuel their popularity.

"I think it's a limited market, although given the media's insatiable
appetite for Internet hype, these movies might do well," said Kevin
Benjamin, analyst with Robertson Stephens.

TriStar Pictures and Columbia Pictures, both divisions of Sony Corp., are
developing movies based on technology or computer crime, executives said.

TriStar is working on a movie called "Johnny Mnemonic," based on a science
fiction story by William Gibson, about a futuristic high-tech "data courier"
with confidential information stored in a memory chip implanted in his head.

Sony also has plans for a CD-ROM game tied to the movie, also called
"Johnny Mnemonic," developed by Sony Imagesoft, a division of Sony
Electronic Publishing.

Columbia Pictures has a movie in development called "The Net," starring
Sandra Bullock, who played opposite Reeves in "Speed." Bullock plays a
reclusive systems analyst who accidentally taps into a classified program and
becomes involved in a murder plot. Sony Imagesoft has not yet decided whether
it will develop a CD-ROM game version of "The Net."

MGM/United Artists is said to be working on a movie called "Hackers,"
about a group of young computer buffs framed for a crime and trying to
protect their innocence. An MGM/UA spokeswoman did not return calls seeking
comment.

Disney is also said to be working on a movie called f2f, (face to face), about
a serial killer who tracks his victims on an online service. Disney also did
not return calls.

Bruce Fancher, once a member of the Legion of Doom hacker gang, worked as a
consultant for "Hackers." He said, much to his dismay, hackers are becoming
more popular and increasingly seen as romantic rebels against society.

"I've never met one that had political motivation. That is really something
projected on them by the mainstream media," Fancher said.

-------------------------------------------------------------------------------

Film, Multimedia Project In The Works On Hacker Kevin Mitnick      Mar  8, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
By Greg Evans (Variety)

Miramax Films will produce a film and a multimedia project based on the
hunt for accused cyber felon Kevin Mitnick, the computer criminal who
captured the attention of the New York Times, the FBI and Hollywood.

Less than a month after Mitnick's capture made the front page of Feb. 16's
Times, Miramax has purchased the worldwide film and interactive rights to
the hacker's tale.

Rights were bought for an undisclosed amount from computer security expert
Tsutomu Shimomura, who led the two-year pursuit of Mitnick, and reporter
John Markoff, who penned the Times' article.

Markoff will turn his article into a book, which will be developed into a
script. "Catching Kevin: The Pursuit and Capture of America's Most Wanted
Computer Criminal" will be published later this year by Miramax's sister
company, Hyperion Books (both companies are owned by the Walt Disney Co.).

Miramax also plans to work with Shimomura to develop an interactive
project, most likely a CD-ROM, based on "Catching Kevin," according to
Scott Greenstein, Miramax's senior VP of motion pictures, music, new media
and publishing. He represented Miramax in the deal.

No director has been attached to the film project yet, although the company
is expected to make "Kevin" a high priority.

The story attracted considerable studio attention. In a statement, Shimomura
said he went with Miramax "based on their track record."

Shimomura and Markoff were repped by literary and software agent John Brockman
and Creative Artists Agency's Dan Adler and Sally Willcox.

-------------------------------------------------------------------------------

Hack-Happy Hollywood                                                   Mar 1995
~~~~~~~~~~~~~~~~~~~~
(AP News Sources)

Not since the heyday of Freddy Krueger and Jason Voorhees has hacking been
so in demand in Hollywood.

Only this time, it's computer hackers, and the market is becoming glutted
with projects. In fact, many studio buyers were reluctant to go after the
screen rights to the story of computer expert Tsutomu Shimomura, who tracked
down the notorious cyber-felon Kevin Mitnick.

The rights were linked to a New York Times article by John Markoff, who's
turning the story into a book.

But Miramax wasn't daunted by any competing projects, and snapped up the
rights.

"We're talking about a ton of projects that all face the same dilemma: How
many compelling ways can you shoot a person typing on a computer terminal?"
said one buyer, who felt the swarm of projects in development could face
meltdown if the first few films malfunction.

The first test will come late summer when United Artists opens "Hackers,"
the Iain Softley-directed actioner about a gang of eggheads whose hacking
makes them prime suspects in a criminal conspiracy.

Columbia is currently in production on "The Net," with Sandra Bullock as
an agoraphobic computer expert who's placed in danger when she stumbles onto
secret files.

Touchstone has "The Last Hacker," which is closest in spirit to the Miramax
project. It's the story of hackmeister Kevin Lee Poulson, who faces a hundred
years in prison for national security breaches and was so skilled he disabled
the phones of KIIS-FM to be the 102nd (and Porsche-winning) caller. He was
also accused of disabling the phones of "Unsolved Mysteries" when he was
profiled.

Simpson/Bruckheimer is developing "f2f," about a serial killer who surfs
the Internet for victims.

Numerous other projects are in various stages of development, including
MGM's "The Undressing of Sophie Dean" and the Bregman/Baer project
"Phreaking," about a pair of hackers framed for a series of homicidal
computer stunts by a psychotic hacker.

-------------------------------------------------------------------------------

A Devil Of A Problem                                               Mar 21, 1995
~~~~~~~~~~~~~~~~~~~~
by David Bank (Knight-Ridder)

Satan is coming to the Internet and might create havoc for computer networks
around the world.

The devilish software, due for release April 5, probes for hidden flaws
in computer networks that make them vulnerable to intruders.  The tool could
be used by mischievous pranksters or serious espionage agents to attack and
penetrate the computer networks of large corporations, small businesses or even
military and government installations.

None of the potential problems has swayed the authors of the program, Dan
Farmer, the "network security czar" of Silicon Graphics Inc. in Mountain
View, California, and Wietse Venema, his Dutch collaborator.

"Unfortunately, this is going to cause some serious damage to some people,"
said Farmer, who demonstrated the software this month in his San Francisco
apartment.  "I'm certainly advocating responsible use, but I'm not so
naive to think it won't be abused."

"It's an extremely dangerous tool," said Donn Parker, a veteran computer
security consultant with SRI International in Menlo Park, California.  "I
think we're on the verge of seeing the Internet completely wrecked in a sea
of information anarchy."

Parker advocates destroying every copy of Satan.  "It shouldn't even be
around on researcher's disks," he said.

-------------------------------------------------------------------------------

Satan Claims Its First Victim                                      Apr  7, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
by Dwight Silverman (Houston Chronicle)

The cold hand of Satan knocked on the electronic door of Phoenix Data Systems
Wednesday night, forcing the Clear Lake-based Internet access provider to
temporarily shut down some computers.

"These guys can come in and literally take control, get super-user status on
our systems," said Bill Holbert, Phoenix's owner.  "This is not your
average piece of shareware."

The attack began about 9 p.m. Wednesday, he said.  Technicians watched for a
while and then turned off the machines at Phoenix that provide "shell"
accounts, which allow direct access to a computer's operating system.

The system was back up Thursday afternoon after some security modifications,
he said.

"It actually taught us a few things," Holbert said.  "I've begun to believe
that no computer network is secure."

-------------------------------------------------------------------------------

Fraud-free Phones                                                  Feb 13, 1995
~~~~~~~~~~~~~~~~~
by Kirk Ladendorf (Austin American Statesman) p. D1

Texas Instruments' Austin-based Telecom Systems business came up with an
answer to cellular crime:  a voice-authorization service.

The technology, which TI showed off at the Wireless '95 Convention &
Exposition in New Orleans this month, was adapted from a service devised
for long-distance telephone companies, including Sprint.

TI says its voice-recognition systems can verify the identity of cellular
phone users by reading and comparing their "voice prints," the unique sound
patterns made by their speech.

The TI software uses a statistical technique called Hidden Markov Modeling
that determines the best option within a range of choices as it interprets a
voice sample.

If the verification is too strict, the system will reject bona fide users
when their voice patterns vary too much from the computer's comparison sample.
If the standard is too lenient, it might approve other users whose voice
patterns are similar to that of the authentic user.

The system is not foolproof, TI officials said, but beating it requires far
more time, effort, expense and electronics know-how than most cellular
pirates are willing to invest.

-------------------------------------------------------------------------------

Nynex Recommends Cellular Phone Customers Use A Password           Feb  9, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
By Aaron Zitner (The Boston Globe)

Nynex Corp. is asking cellular telephone customers to dial an extra four
digits with each phone call in an attempt to foil thieves who steal an
estimated $1.3 million in cellular phone services nationwide each day.

Nynex Mobile Communications Co., has been "strongly recommending" since
November that all new customers adopt a four-digit personal identification
number, or PIN. This week, the company began asking all its customers to use
a PIN.

The Cellular Telecommunications Industry Association estimates that "phone
thieves" made $482 million in fraudulent calls last year, equal to 3.7
percent of the industry's total billings. Thieves can make calls and bill
them to other people by obtaining the regular 10-digit number assigned to a
person's cellular phone, as well as a longer electronic serial number that is
unique to each phone.

Thieves can snatch those numbers from the air using a specialized scanner,
said James Gerace, a spokesman for Nynex Mobile Communications. Even when no
calls are being made, cellular phones broadcast the two numbers every 30
seconds or so to notify the cellular system in case of incoming calls, he said.

When customers adopt a PIN, their phone cannot be billed for fraudulent calls
unless the thieves also know the PIN, Gerace said. He said the phone broadcasts
the PIN at a different frequency than the phone's electronic serial number,
making it hard for thieves to steal both numbers with a scanner.

Gerace also noted that customers who become victims of fraud despite
using a PIN can merely choose a new number. Victims who do not use a PIN
must change their phone number, which requires a visit to a cellular phone
store to have the phone reprogrammed, he said.

[ Uh, wait a second.  Would you use touch-tone to enter this PIN?  Woah.
  Now that's secure.  I've been decoding touch-tone by ear since 1986.
  What a solution!  Way to go NYNEX! ]

-------------------------------------------------------------------------------

Kemper National Insurance Offers PBX Fraud                         Feb  3, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
(Knight-Ridder News Sources)

Kemper National Insurance Cos. now offers inland marine insurance
coverage to protect Private Branch Exchange (PBX) systems against toll fraud.

"Traditional business equipment policies companies buy to protect their PBX
telephone systems do not cover fraud," a Kemper spokesman said.
The Kemper policy covers both the equipment and the calls made illegally
through the equipment.

The coverage is for the PBX equipment, loss of business income from missed
orders while the PBX system is down, and coverage against calls run up on
an insured's phone systems. The toll fraud coverage is an option to the PBX
package.

-------------------------------------------------------------------------------

New Jersey Teen To Pay $25,000 To Microsoft, Novell              Feb  6, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The Wall Street Journal

Microsoft Corp. and Novell Inc. reached a court-approved settlement with
a New Jersey teenager they accused of operating a computer bulletin board
that illegally distributed free copies of their copyrighted software programs.

Equipped with a court order, employees of the two companies and federal
marshals raided the young man's house in August, seizing his computer
equipment and shutting down an operation called the Deadbeat Bulletin Board.
Under the settlement announced Friday, the teenager agreed to pay $25,000 to
the companies and forfeit the seized computer equipment. In return, the
companies agreed to drop a copyright infringement lawsuit brought against
him in federal court in New Jersey, and keep his identity a secret.

Redmond-based Microsoft and Novell, Provo, Utah, opted to take action against
the New Jersey man under civil copyright infringement laws rather than pursue
a criminal case. The teenager had been charging a fee to users of the Deadbeat
Bulletin Board, which was one reason the companies sought a cash payment, a
Novell spokesperson said. The two software producers previously settled a
similar case in Minneapolis, when they also seized the operator's equipment
and obtained an undisclosed cash payment.

"About 50 groups are out there engaging in piracy and hacking," said Edward
Morin, manager of Novell's antipiracy program. He said they operate with
monikers such as Dream Team and Pirates With Attitude.

-------------------------------------------------------------------------------

Software Piracy Still A Big Problem In China                       Mar  6, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
By Jeffrey Parker (Reuters News Sources)


Sales of pirated software have reached a fever pitch in Beijing in the week
since U.S. and Chinese officials defused a trade war with a broad accord to
crush such intellectual property violations.

In the teeming "hacker markets" of the Zhongguancun computer district near
Beijing University, there were few signs of any clampdown Monday, the sixth
day of a "special enforcement period" mandated by the Feb. 26 Sino-U.S. pact.

"The police came and posted a sign at the door saying software piracy is
illegal," said a man selling compact disk readers at bustling Zhongguancun
Electronics World.

"But look around you. There's obviously a lot of profit in piracy," he said.

A score of the market's nearly 200 stalls openly sell compact disks loaded
with illegal copies of market-leading desktop software titles, mostly the
works of U.S. firms.

Cloudy Sky Software Data Exchange Center offers a "super value" CD-ROM for
188 yuan ($22) that brims with 650 megabytes of software from Microsoft,
Lotus and other U.S. giants whose retail value is about $20,000, nearly
1,000 times higher.


-------------------------------------------------------------------------------

Internet Story Causes Trouble                                      Feb  7, 1995
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
(AP News Sources)

The University of Michigan has refused to reinstate a sophomore suspended
last week after he published on the Internet a graphic rape and torture
fantasy about a fellow student.

The student's attorney told The Detroit News on Monday that the
university is waiting until after a formal hearing to decide if the
20-year-old student is a danger to the community. A closed hearing
before a university administrator is scheduled for Thursday.

"Our position is that this is a pure speech matter," said Ann
Arbor attorney David Cahill. "He doesn't know the girl and has
never approached her. He is not dangerous. ... He just went off
half-cocked."

The Jan. 9 story was titled with the female student's last name
and detailed her torture, rape and murder while gagged and tied to
a chair.

The student also may face federal charges, said FBI Special
Agent Gregory Stejskal in Ann Arbor. Congress recently added
computer trafficking to anti-pornography laws.

The student was suspended Thursday by a special emergency order
from university President James J. Duderstadt. His identification
card was seized and he was evicted from his university residence
without a hearing.

University spokeswoman Lisa Baker declined to comment.

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Snuff Porn On The Net                                              Feb 12, 1995
~~~~~~~~~~~~~~~~~~~~~
by Philip Elmer-Dewitt (Time)

Jake Baker doesn't look like the kind of guy who would tie a woman by her
hair to a ceiling fan. The slight (5 ft. 6 in., 125 lbs.), quiet, bespectacled
sophomore at the University of Michigan is described by classmates as gentle,
conscientious and introverted.

But Baker has been doing a little creative writing lately, and his words have
landed him in the middle of the latest Internet set-to, one that pits a
writer's First Amendment guarantees of free speech against a reader's right
to privacy. Now Baker is facing expulsion and a possible sentence of five
years on federal charges of sending threats over state lines.

It started in early December, when Baker composed three sexual fantasies and
posted them on alt.sex.stories, a newsgroup on the Usenet computer network
that is distributed via the Internet. Even by the standards of alt.sex.stories,
which is infamous for explicit depictions of all sorts of sex acts, Baker's
material is strong stuff. Women (and young girls) in his stories are
kidnapped, sodomized, mutilated and left to die by men who exhibit no remorse.
Baker even seemed to take pleasure in the behavior of his protagonists and
the suffering of their victims.

The story that got Baker in trouble featured, in addition to the ceiling fan,
acts performed with superglue, a steel-wire whisk, a metal clamp, a spreader
bar, a hot curling iron and, finally, a match. Ordinarily, the story might
never have drawn attention outside the voyeuristic world of Usenet sex groups,
but Baker gave his fictional victim the name of a real female student in one
of his classes.

Democratic Senator James Exon of Nebraska introduced legislation earlier
this month calling for two-year prison terms for anyone who sends, or
knowingly makes available, obscene material over an electronic medium.
"I want to keep the information superhighway from resembling a red-light
district," Exon says.