-Caveat Lector- <A HREF="http://www.ctrl.org/"> </A> -Cui Bono?- Click Here: <A HREF="http://www.zdnet.com/zdnn/stories/news/0,4586,2486808,00.html?chkpt=zdhp news01">ZDNet: News: SEC Web snooping plan draws fire</A> ----- SEC Web snooping plan draws fire Is it a good idea to spend millions of U.S. dollars to scour the Net for securities-law violators? Privacy advocates scream foul. By Michael Moss, WSJ Interactive Edition March 28, 2000 4:11 PM PT The Securities and Exchange Commission is moving to create an automated surveillance system that would scour the Internet for people who violate securities law. The agency has begun receiving proposals from vendors, who have conducted trial runs in recent weeks. But even before it gets under way, the multimillion-dollar project is running into trouble on privacy grounds. Sound off here!! Post your comment Privacy and fraud AnchorDesk Briefing Center: Privacy AnchorDesk Briefing Center: Net Politics ZDNet Topics: Security PairGain Web hoax: Hoke grounded SEC: Online brokers need more disclosure The mechanism would monitor public Web sites, message boards and chat groups. Anything deemed suspicious -- like the phrase "get rich quick" -- would be copied into a database, analyzed and then indexed for use by SEC investigators in bringing civil proceedings against people suspected of wrongdoing, according to the agency's project-contractor solicitation. The SEC also wants to grab e-mail addresses and other identifying information that would help unmask message writers and Web-site owners who try to remain anonymous. Other federal agencies might develop their own automated surveillance, the contracting records indicate. "For us it's a very exciting prospect," said Phyllis J. Cela, acting director of enforcement at the Commodity Futures Trading Commission, which has begun talking to vendors. PricewaterhouseCoopers said no But after reviewing the documents and holding discussions with SEC officials, one invited bidder, PricewaterhouseCoopers LLP, advised the agency that it would not participate because the endeavor might impinge on constitutional protections against unlawful search and seizure. Its chief concern: Innocent people would end up in the database. "We had serious concerns about the implications for the privacy of individuals on the Web, and the implications for businesses on the Web," said Beth Trent, a director who leads the firm's Internet compliance unit. "There are all sorts of legitimate reasons people want to remain anonymous," adds former U.S. Department of Justice computer-crime specialist Scott Charney, now a partner at PricewaterhouseCoopers. The SEC may also find itself pitted against giant Internet operators who consider even their public chat boards to be proprietary. America Online Inc. (NYSE: AOL), whose boards are cited in the SEC document as a surveillance target, said it routinely forbids anyone from harvesting information from its many thousands of chat rooms and message boards in order to protect the privacy of its customers. Privacy and anonymity Moreover, the SEC's foray comes at a time when the Federal Trade Commission and many states are scrambling to protect the privacy of Internet users. The threat of regulation and mounting public concern about online tracking by marketers are prompting many Web-site owners to take measures aimed at preventing their customers from being snooped on. SEC officials say they intend to address Web companies' concerns. "The Securities and Exchange Commission has a history of abiding with the letter and spirit of privacy laws and policies, and we will continue to maintain that position during this procurement," said George C. Brown, an assistant general counsel. The SEC also said it won't gather e-mail or other communications that don't appear in public forums, or make a record of people who simply visit a Web site or board but don't post any messages. And any information collected that doesn't indicate possible wrongdoing will be discarded. The agency also said the contractor will be bound by a strict nondisclosure agreement. The database project grew out of the SEC's frustration with trying to battle bad guys in cyberspace. The Internet is expanding quickly, and scanning it manually with traditional search engines is tedious at best. Then there's the problem of anonymity. As most cyberchatters decline to identify themselves, the SEC must often subpoena records from chat-board owners before it can get an investigation rolling. Some boards don't make that easy, said John Reed Stark, the SEC's chief Internet enforcement officer. "We're subpoenaing under incredible time constraints in these investigations," Stark said. "In some instances you're dealing with companies that are just starting out, and in other instances they are growing at phenomenal rates that are making other demands on their time." Front Page Tech Center Money and Investing Subscribe to wsj.com AOL goes a step further. Because the SEC brings civil complaints and not criminal charges, AOL treats the agency the same way it treats the many companies that bring defamation suits against chatters and subpoena records from AOL to identify the service's customers. It alerts its customers and gives them 14 days to block the subpoenas. Stark said he doesn't quarrel with AOL's policy but notes that the SEC strives to find other ways to identify message writers. "Sometimes we can figure out who people are through old-fashioned detective work," he said, declining to elaborate. Next page / Part 2: Congress' SEC support See also: Law and Politics section Tech Jobs | Digital Coupons | Free E-mail | Newsletters | Updates | MyZDN et | Alerts | Rewards | Join ZDNet | Members | ZDNet eCircles Feedback | Your Privacy | Service Terms | Ad Info Copyright � 2000 ZD Inc. All rights reserved. ZDNet and the ZDNet logo are trademarks of ZD Inc. ----- Aloha, He'Ping, Om, Shalom, Salaam. Em Hotep, Peace Be, All My Relations. Omnia Bona Bonis, Adieu, Adios, Aloha. Amen. Roads End <A HREF="http://www.ctrl.org/">www.ctrl.org</A> DECLARATION & DISCLAIMER ========== CTRL is a discussion & informational exchange list. Proselytizing propagandic screeds are not allowed. Substance�not soap-boxing! 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