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January 21, 2002, 9:00 AM ET, Alert No. 350.
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PPI Advocates Greater Use of IT to Fight Terrorism
1/18. The Progressive Policy Institute (PPI) released two papers that call on government to increase the use of information technology to prevent terrorist attacks, and to facilitate coordination between local, state, and national law enforcement authorities. The two papers are Using Technology to Detect and Prevent Terrrorism [PDF], by Shane Ham and Robert Atkinson, and The State and Local Role in Domestic Defense [PDF], by John Cohen and John Hurson.
Ham and Atkinson argue in their paper that "The information technology revolution that transformed our economy has also given us the tools, infrastructure, and commercial capabilities to make domestic defense easier, less expensive, and more effective, making all Americans safer."
The Ham Atkinson paper continues that "Technology has revolutionized the economy with dramatic productivity improvements and an array of new communications and information processing tools. We must bring that same revolution to domestic defense, to gain maximum security and public confidence with minimum investment. The IT revolution has given us many tools -- wireless data networks, encryption, powerful miniature computer chips, the global Internet, data mining software, and many more -- that weren't available for domestic security just a few years ago. Now that we have these tools, it is time to roll them out to make our nation safer."
Data Sharing. The paper recommends the use of "improved data sharing, combining criminal records and intelligence information from a variety of federal, state, and local agencies that can be accessed wirelessly to identify wanted criminals and suspected terrorists when they encounter law enforcement or attempt to enter secure facilities."
Digital Surveillance. The paper also calls for increased use of "digital surveillance, extending longstanding principles of law enforcement and surveillance to the Internet by permitting surveillance of email and other electronic data while preserving traditional safeguards on searches by government agents".
The paper continues that "The recent antiterrorism legislation signed by President Bush extended many of those surveillance techniques to their Internet counterparts, but unfortunately there is still a good deal of unjustified concern about the new technologies developed for law enforcement over the Internet."
Carnivore. The paper advocates the use of two recently developed tools, DCS 1000, which is also known as Carnivore, and Magic Lantern. It describes DCS 1000 as a "device ... installed, by court order, at Internet service providers to search email traffic. (Contrary to popular belief, the system does not search through the email of every customer looking for suspicious content.) By looking only for certain specific recipients or keywords in email sent by suspects, DCS 1000 saves time for agents by letting them focus their efforts on the e-mails that are most relevant, even though they would be entitled by court order to read all of the email that DCS 1000 searches." (Parentheses in original.)
Magic Lantern. The paper states that "Magic Lantern and other ``key logging´´ programs allow agents with search warrants to record every keystroke on a targeted computer. Reading the keystrokes can give agents passwords, which are critical when criminals are using strong encryption for their data and communications."
The Ham Atkinson paper concludes that "Without tools such as these, the old system of wiretapping is rendered all but useless -- criminals will simply use Internet chats and encrypted e-mails rather than telephones."
Shane Ham and the other authors spoke at an event for the release of the two papers. He stated that "the fight over the USA PATRIOT Act is not over yet. We are going to be arguing about that for a long time." Robert Atkinson stated that "I think that the civil libertarian community is actively organizing opposition to virtually any sort of expansion or modernization of our law enforcement and intelligence system through technology. And, the way they are doing it is by preying upon fears, by using overblown rhetoric, like ``smart cards will turn America into a Nazi, show us your papers, police state´´. ... Privacy is not an absolute standard. We trade it off every single day when we have to show our drivers license at the airport ... we can deploy all of these technologies without really damaging or hurting privacy."
The Ham Atkinson paper also recommends the use of smart ID cards "with biometric identifiers, adding chips containing thumbprint scans or other biometric data to driver’s licenses, as well as standardized security features for preventing forgery and fraud". The paper also recommends the use of smart visas and face recognition technologies.
Legislative Recommendations. The paper then calls upon Congress to assist in funding the deployment of these new technologies. It also states that "Congress should mandate that any standardization efforts by the state motor vehicle agencies include upgrading all ID cards to smart cards. In addition, Congress should provide matching grants to state agencies to deploy hardware that can read smart cards, and should fund pilot programs for states that seek to integrate multiple functions into the smart cards, such as voter registration. The paper urges passage of S 1749, the Enhanced Border Security and Visa Entry Reform Act of 2001, a smart visa bill. It also recommends that Congress boost funding to deploy technology hardware to border agents.
Atkinson also called for a Chief Information Officer for Homeland Defense, to see that new technologies are deployed quickly and efficiently.
Finally, Atkinson argued that there would be economic benefits. For example, he stated: "Those of you who followed the digital signatures act a few years ago in Congress -- it was passed with great whoopla -- that now all Americans would now be able to sign documents on line digitally. It hasn't happened. It won't happen. It won't happen until most Americans have a way to authenticate themselves on line through some sort of PKI system. If we were to give every American a smart card, a chip card, biometric, on their driver's license, overnight we would jump start this market place."
Cohen and Hurson argue in their paper, The State and Local Role in Domestic Defense [PDF], that "we must redefine our concept of national security. We can no longer afford to think of national security as the sole province of the military, or even the federal government’s intelligence, law enforcement, and border control agencies. Keeping America safe from terrorists and responding when they elude our defenses is also the urgent task of state and local law enforcement and response agencies."
They also argue that "our approach to domestic defense must be national and seamless. To this end, we must improve information sharing with our front line law enforcement officers ..."
The PPI is a Washington DC based think tank affiliated with the Democratic Leadership Council, which is also known as the New Democrats. Robert Atkinson is VP of the PPI and Director of the PPI's Technology & New Economy Project. Shane Ham is a Senior Policy Analyst at PPI's Technology & New Economy Project. John Cohen is the Director of the PPI's Community Crime Fighting Project.
Eli Lilly Settles with FTC over Inadvertent E-Mail
1/18. The Federal Trade Commission (FTC) initiated an administrative proceeding against Eli Lilly alleging violation of the Federal Trade Commission Act (FTCA) in connection with Eli Lilly's accidental disclosure of of personal information of subscribers to an e-mail remainder service. See, administrative complaint [PDF]. The FTC and Eli Lilly simultaneously entered into a proposed settlement agreement under which Eli Lilly agrees to "establish and maintain an information security program for the protection of personally identifiable information". See, Agreement Containing Consent Order [PDF].
Eli Lilly is a pharmaceutical company. It offered an e-mail reminder service regarding use of the drug Prozac. On one occasion it sent an e-mail reminder to 669 subscribers to the service using the "To:" method of addressing the e-mail, rather than the "BCC:" method. The ACLU submitted a letter complaint to the FTC.
Eli Lilly had published a privacy policy that stated, among other things, that "Our Web sites have security measures in place, including the use of industry standard secure socket layer encryption (SSL), to protect the confidentiality of any of Your Information that you volunteer".
The complaint alleges that Eli Lilly "has not employed measures and has not taken steps appropriate under the circumstances to maintain and protect the privacy and confidentiality of personal information obtained from or about consumers through its Prozac.com and Lilly.com Web sites." The complaint further alleges that this constituted unfair or deceptive acts or practices in or affecting commerce in violation of Section 5(a) of the FTCA.
FTC Commissioner Orson Swindle wrote a concurring statement. He stated that "Lilly's unfortunate and unintended disclosure of prescription drug users' personal information has given us all the opportunity to evaluate how to improve upon security practices for confidential information."
Eli Lilly did not admit wrongdoing. The consent order contains no fine. Eli Lilly is represented by Karen Silverman of the law firm of Latham & Watkins. There is a thirty day period for public comments on the proposed consent order, before it is given final approval. See also, FTC release and FTC analysis.
FCC Tentatively Fines SBC $6 Million
1/18. The Federal Communications Commission (FCC) released a Notice of Apparent Liability (NAL) proposing that SBC be fined $6 Million for non-compliance with a competition related condition imposed by the FCC in approving license transfers in connection with the 1999 merger of SBC and Ameritech. The NAL states that "it appears that SBC failed to offer shared transport in the former Ameritech states under terms and conditions substantially similar to those that it offered in Texas as of August 27, 1999, in violation of the SBC/Ameritech Merger Order." See also, FCC release.
SBC disputes the FCC's NAL. It stated in a release that "SBC has met our obligations under the SBC/Ameritech Merger Conditions to provide competitors with shared access to our networks in the Ameritech region and elsewhere. That's one reason why CLECs are serving 12 million access lines in our territory."
Representatives Seek Stricter Enforcement of Telecom Act
1/17. Six Members of the House of Representatives wrote a letter [PDF] to Federal Communications Commission (FCC) Chairman Michael Powell requesting better enforcement of the provisions of the Telecom Act of 1996 regarding nondiscriminatory provisioning of unbundled network elements and special access services.
The six wrote that "We are concerned that the ILECs have not take all of their obligations under the Telecommunications Act of 1996 seriously. It appears that American consumers are suffering as a result. Congress enacted the 1996 Act in order to bring innovative voice and data services to all Americans from a multitude of service providers at reasonable prices. Without better enforcement of the Act, we may soon regress to the days of monopoly telecommunications."
The letter pertains to two pending Notice of Proposed Rulemakings (NPRMs), numbered CC Docket No. 01-318 and CC Docket No. 01-321. The six signatories are Rep. Steve Largent (R-OK), Rep. Bart Stupak (D-MI), Rep. Chris Cannon (R-UT), Rep. Karen McCarthy (D-MO), Rep. Anna Eshoo (D-CA), and Rep. Joe Pitts (R-PA).
AOL TW Reports on Status of IM Interoperability
1/17. AOL Time Warner submitted to the Federal Communications Commission (FCC) its second progress report [PDF] on the interoperability of instant messaging (IM) systems. These reports are required by the FCC's January 22, 2001, order approving the merger of AOL and Time Warner.
AOL Time Warner wrote that "it has continued to make progress in this area. ... AOL has completed development and testing of an initial prototype gateway server designed to translate basic text based IMs and presence information between the internal protocol used by AOL Instant Messenger ("AIM") and one that is based on the protocol that the Internet Engineering Task Force's ("IETF") SIP for Instant Messaging and Presence Leverage ("SIMPLE") Working Group is designing. Then, AOL conducted a server to server interoperability trial with Lotus Development Corporation ("Lotus")."
AOLTW also stated that this trial was conducted under "tightly controlled circumstances". The gateway server "was not designed to be scalable in order to handle large amounts of traffic, nor was it designed to address security threats such as distributed denial of service attacks, data hijacking, identity spoofing, namespace discovery, and spam." It concluded, "There remains, however, much work to be done."
People and Appointments
1/14. Laurence Meyer submitted his resignation as a member of the Board of Governors of the Federal Reserve System, effective the last day of his term, January 31, 2002. See, FRB release. 
Monday, Jan 21
Martin Luther King Day. The FCC will be closed. The National Press Club will be closed.
Tuesday, Jan 22
10:00 AM - 12:30 PM. The FCC's Office of Engineering and Technology and Corning Incorporated will host a tutorial on optical communications. See, FCC notice. Location: FCC, Commission Meeting Room (TWC-305), 445 12th Street, SW, Washington DC.
12:15 PM. The Federal Communications Bar Association's Common Carrier Practice Committee will host a brown bag lunch. The speaker will be Dorothy Attwood, Bureau Chief of the FCC's Common Carrier Bureau. RSVP to Rhe Brighthaupt at rbrighth@wrf.com. Location: Wiley Rein & Fielding, 1750 K St., NW, 10th Floor Conference Room.
Wednesday, Jan 23
The House reconvenes at 12:00 NOON. It will then take up two non tech related bills (HR 700 and HR 2234).
The Senate reconvenes at 12:00 NOON. The Senate will recess from 12:30 - 2:15 PM, for the weekly party conferences.
9:00 AM - 5:15 PM. There will be a day long conference titled Broadband Outlook 2002 Conference. Location: Four Seasons Hotel, Washington DC. The scheduled speakers include the following:
 • 9:15 - 9:45 AM. Nancy Victory, head of the NTIA.
 • 10:45 - 11:45 AM. Robert Pepper, Chief of the FCC's Office of Plans and Policy.
 • 11:45 AM - 12:00 NOON. Dorothy Atwood, Chief of the FCC's Common Carrier Bureau.
 • 12:00 NOON - 1:30 PM. Ken Feree, Chief of the FCC's Cable Services Bureau.
12:15 PM. The Federal Communications Bar Association's Global Telecommunications Development Committee will host a brown bag lunch. Doreen McGirr (Department of State) and John Giusti (FCC International Bureau) will speak about preparations for the ITU World Telecommunications Development Conference. RSVP to Kent Bressie. Location: Wilkinson Barker Knauer, 2300 N Street, NW, 7th floor, Washington DC.
Thursday, Jan 24
The House will meet at 10:00 AM to take up HR 1762, a bill to amend the Higher Education Act.
9:30 AM. The House Commerce Committee's Subcommittee on Oversight and Investigations will hold a hearing the destruction of Enron related documents by Anderson personnel. Location: Room 2322, Rayburn House Office Building.
11:00 AM. The Cato Institute will host a panel discussion titled "Eye in the Sky -- and Everywhere Else:
Do Biometric Technologies Violate Our Rights?" The speakers will be Joseph Atick (Visionics Corp.), Marc Rotenberg (EPIC), Dorothy Denning (Georgetown University), and John Woodward (RAND). A lunch will follow the program. Location: Cato Institute, 1000 Massachusetts Avenue, NW, Washington DC.
12:15 PM. The Federal Communications Bar Association's Mass Media Committee will host a brown bag lunch. The speakers will be David Solomon, Chief of the FCC's Enforcement Bureau, and Linda Blair, Deputy Chief of the FCC's Enforcement Bureau. RSVP to kdole@npr.org. Location: National Public Radio, 635 Massachusetts, Ave., NW, 1st Floor, Washington DC.
2:00 PM. The Senate Judiciary Committee will hold a hearing on judicial nominations. Sen. Maria Cantwell (D-WA) will preside. Location: Room 226, Senate Dirksen Building.
Friday, Jan 25
The House will meet at 10:00 AM in pro forma session only.
FRB Vice Chair Addresses Affect of Tech on Economy
1/16. Federal Reserve Board Vice Chairman Roger Ferguson gave a speech in Denver, Colorado, to the Economic Club of Colorado titled "Developments in the U.S. Economy: Review and Outlook".
He stated that "Booming investment in the 1990s owed importantly to steep declines in prices of high-tech equipment, which largely reflected rapid technical progress. About half a percentage point of the increase in productivity growth in the 1995-99 period can be attributed to this so-called capital deepening. I believe that technological progress will continue to drive down information technology costs in the coming years. Moreover, businesses have reaffirmed their intentions to improve productivity by substituting cost-saving high-tech capital for labor."
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