Date: Tue, 06 Jun 95 07:07:06 EST
Errors-To: Comp-privacy Error Handler <owner-comp-privacy@uwm.edu>
From: Computer Privacy Digest Moderator <comp-privacy@uwm.edu>
To: Comp-privacy@uwm.edu
Subject: Computer Privacy Digest V6#051
Computer Privacy Digest Tue, 06 Jun 95 Volume 6 : Issue: 051
Today's Topics: Moderator: Leonard P. Levine
Opt Out of New Phone Service
Re: Sending VISA Card Details by e-Mail
Re: Sending VISA Card Details by e-Mail
Re: Sending VISA Card Details by e-Mail
Re: CIBC and Royal Bank to do MONDEX Pilot
Re: Text Filter for the Very Good
A Little Peek inside FinCEN
Re: The Microsoft Win95 Virus - update
Mistaken Identity & Natl Smart ID
Re: Credit Cards in Grocery Stores
Excerpts from TNO 2(5)
Exon Bill Petition
Internet Regulations
Defying Pitfalls of a Cashless Society
Info on CPD [unchanged since 12/29/94]
----------------------------------------------------------------------
From: danpatents@aol.com (DanPatents)
Date: 02 Jun 1995 22:25:16 -0400
Subject: Opt Out of New Phone Service
Organization: America Online, Inc. (1-800-827-6364)
A new issue of privacy and computers has arisen. Recently, I received
the following notice on the second to last page of my local telephone
bill. I'll rewrite it all here. You may have this same service sooner
or latter from your own local phone company. You may want to take
advantage of the opt out option. What do you think about the
following?
(Quoting now from a local telephone service bill where XXXXX is the
name of the telephone company):
*For Your Information*
May 17, 1995
IMPORTANT NOTICE ABOUT A NEW XXXXX SERVICE
On July 1, 1995, XXXXX will introduce a new automated customer name and
address service. This dial-in service will provide the capability of
matching published telephone numbers with their corresponding names and
addresses, as they appear in the telephone directory. *If you do not
want your information included in this service, you may call
1-800-xxx-xxxx, operator xxxx, until June 30, 1995, and request that
your information be excluded from this service. After June 30, 1995,
please contact our Business Office.* The number is listed in the
Customer Guide section of your local XXXXX directory.
------------------------------
From: "Mark W. Eichin" <eichin@mit.edu>
Date: 02 Jun 95 22:55:25 -0400
Subject: Re: Sending VISA Card Details by e-Mail
"American banks refuse to let mail-order companies check the
address of the card's owner". So, if I know the number of a
USA-issued card I can
I recently ordered a laptop, and was told that they would only ship it
to an address that the credit card company listed (inconvenient as it
meant I had to pick it up at my box instead of having it shipped to my
office.) They said that it was possible to call the Credit Card company
and inform them of additional valid shipping addresses, though I didn't
try that.
------------------------------
From: sean@sdg.dra.com (Sean Donelan)
Date: 03 Jun 95 15:34:12 CST
Subject: Re: Sending VISA Card Details by e-Mail
Organization: Data Research Associates, St. Louis MO
NRA@maxwell.ph.kcl.ac.uk writes: Firstly, it's worth repeating the
quote from Barclay's bank: "... but we would make it clear that
for someone to send their credit card number unencrypted across the
Internet breaks their agreement with the bank that issued the
card." That's pretty clear: DON'T DO IT! (or you may indeed wind
up footing the bill when a hacker grabs your number).
Berclay's bank must have some different language in their cardholder
agreement than most US banks do. US bank card holder agreements say
nothing about the Internet, or encryption. Of course, US law tends to
put the bulk of the risk on the card issuer, not the card holder. The
US credit card associations rules and regulations further allocate much
of the risk to the merchant acquirier.
Of course, we're now back to the age old questions. How much risk
really exists. According to the credit card industry the biggest
source of credit card fraud remains lost/stolen/never received credit
cards.
My opinion whether the Internet is really more or less secure than a
TYMNET PAD with XRAY is debatable. During the 1980's TYMNET was the
largest credit card network processor in the world with essentially no
encryption. If Barclay's Bank really wants to play the Fear,
Uncertainty and Doubt (FUD) game, I suggest they need to be more
careful. Skeletons exist in many banks' closets.
Third, there seems to be a divide between USA and non-USA which
means that USA customers fare worst. In the UK, a retailer must
confirm that the address to which he ships gods* is the same as the
address of the credit card owner (or risk not being paid for a
fraudulent order). "American banks refuse to let mail-order
companies check the address of the card's owner". So, if I know the
number of a USA-issued card I can use it to order stuff to be
delivered to any address I choose, like a few grand's worth of
SIMMS to an accomodation address!
There are at least 10 major credit card processing networks in the US
just for MC/VISA. They each work slightly differently. But I know
that VISANET, BANKNET (MC), and FDR have an Address Verfication Service
(AVS). Maybe only Mail Order / Telephone Order merchants (i.e. higher
charges) can use the service though? So not all merchants bother, but
since the MO/TO merchant usually loses any dispute with the bank, some
merchants just view it as the cost of doing business.
--
Sean Donelan, Data Research Associates, Inc, St. Louis, MO
Affiliation given for identification not representation
------------------------------
From: yorick@msen.com (Steve Arlow)
Date: 05 Jun 1995 00:19:50 -0400
Subject: Re: Sending VISA Card Details by e-Mail
Organization: Msen, Inc. -- Ann Arbor, MI
Kelly Bert Manning <bo774@freenet.carleton.ca> wrote: Point of sale
debit card machines have become common in the past few years in my
province. I've yet to see a privacy shield around one of these.
[...]
Interesting. Here in the USA, the point-of-purchase debit card readers
(the ones that I've seen) have small privacy sheilds around them, but
they all give audio feedback (beep!) with each number pressed. This
defeats the protection of the sheild, because anyone watching your hand
can pick up the number by listening for the beeps, even if they can't
see your fingers.
PIN entry is one of the few cases where you *don't* want audible
feedback, just tactile (and maybe visual if the display is private
enough). But it seems that the companies who are building these
systems haven't really given it much thought.
As for teller machines, I was once stung by an ATMs which, without
warning, displayed my full name and the current balance of my account
on a large CRT. I'd like to get my hands around the neck of the fellow
who programmed that one!
--
"Shiba no to ni | Steve Arlow, Yorick Software Inc. | (810) 473-0920
cha o konoha kaku | 39336 Polo Club Dr. #103,
arashi kana" _ | Farmington Hills, MI 48335-5634
-- Matsuo Basho | http://www.msen.com/~yorick | mailto:yorick@msen.com
------------------------------
From: bo774@freenet.carleton.ca (Kelly Bert Manning)
Date: 03 Jun 1995 07:34:45 GMT
Subject: Re: CIBC and Royal Bank to do MONDEX Pilot
Organization: The National Capital FreeNet, Ottawa, Ontario, Canada
Christian Reiser (Christian.Reiser@aut.alcatel.at) writes: Don't
get impressed by the anonymity you seem to have. All these cards
[...]
Did the pronoun get confused in translation? I don't have one of these
and don't plan to. I do have a bank ATM card that I use for the
majority of my cash withdrawals and bankbook updates, but I've never
had a credit card account, or any kind of charge account, and don't
want or need one.
have a serial number and as soon as this number once gets connected
to [...]
The (US) national academy of sciences report on automated databanks
from the early 70s devoted some time to debunking popular press reports
about use of credit cards leaving electronic footprints. Twenty years
ago this was probably a reasonable position to take. With cheap micro
and parallel processors today this kind of "data mining" has come of
age and is much more practical than when computers and storage were
expensive and rare.
some personal data, every newspaper you pay with this card can be
tracked down. In Austria such a system should be installed
beginning next year, but I am afraid of security and safety
aspects. The Company, which introduces these cards here, does not
tell you anything about the means they use. And if their security
depends on obscurity, I do not want to use this system.
I don't want to use it even if has excellent security.
Well, there might turn out to be a secondary/resale market for these,
ie. people who don't care buy them and put some amount of money in
them, then resell them to parties unknown to use in transactions being
done by phone.
Personally when I seem someone using plastic to pay for something I
usually think, "they can't afford to pay cash". For truly anonymous
transactions by mail I use a bank money order. One of the reasons I
switched from a credit union to a bank is that the credit union wanted
to see my member card and fill in the name for me whenever I bought a
money order. They also couldn't understand why I was upset when an ATM
programming error gave me the TRX receipt for the last person to use
the ATM before me and left my receipt in the machine to spit out for
the next person, after all "most people leave their receipts in the
garbage". Time to find another financial institution.
------------------------------
From: rj.mills@pti-us.com (Dick Mills)
Date: 03 Jun 1995 11:37:55 -0400
Subject: Re: Text Filter for the Very Good
ramole@aol.com (RAMole), in CPD 6,50 wrote: It should be possible
to write software to filter any incoming text stream and blank out
the horrible awful dirty words just as newspapers do, e.g.
"Senator Exon is an *******!" Anyone else have some ideas on this?
My first thought was "What about pictures?". My second was, "What's
dirty?"
The net is more anarchistic than a newspaper. I presume you've heard
of anonymous cancelbots. If the filter you propose was available,
nearly everybody would be able to censor everyone else. Conservatives
would filter liberals and visa versa until we were left with thundering
silence.
My third thought is, "Hey, microprocessors are ubiquitous. Why not
build the filter directly into printing presses, broadcast antennas,
and telephone handsets? Better yet. They have noise cancelling
headsets now. I could put a filter in my headset and never again be
bothered by things I don't like hearing. The ++ version would substitue
things I do want to hear."
Your idea has lots of potential Ramole. :)
===================================================
Dick Mills rj.mills@pti-us.com
Power Technologies, Inc. phone +1(518)395-5154
P.O. Box 1058 fax +1(518)346-2777
Schenectady, NY 12301-1058
------------------------------
From: glr@ripco.com (Glen Roberts)
Date: 04 Jun 1995 21:50:20 GMT
Subject: A Little Peek inside FinCEN
Organization: Ripco Internet BBS, Chicago
FinCEN has recently developed a computer system designed to identify
suspicious transactions based on the computer reviewing and correlating
the BSA reports discussed earlier. The FinCEN Artificial Intelligence
Targeting System has been operational since March 1993. However, as of
September 1993, FinCEN was still modifying and enhancing the system.
The system uses a number of rules or conditions to screen, evaluate,
and group the reports filed after January 1, 1993. Each week,
identifying information from the BSA reports (except for the Foreign
Bank Account Reports) are loaded into the computer and linked with
other filings related to the same subjects -- individuals, businesses,
or accounts. The system is designed to periodically produce listings of
subjects that meet certain predetermined thresholds of activity or
transaction amounts that are considered outside the norm. Lists of
potential targets can also be produced by querying the system to
identify subjects that meet certain characteristics.
The lists produced by the system by analysts to week out those subjects
that are legitimate and develop additional information on those that
remain. The resulting list is then sent to the appropriate law
enforcement agency or agencies for consideration. As of August 5, 1993,
FinCEN had sent out a total of 13 lists to 1 or more of 5 federal law
enforcement agencies that contained a total of 216 targets. Five of the
lists were compiled at the request of law enforcement agencies.
--
--------------------------------------
Glen L. Roberts, Editor, Full Disclosure
Host Full Disclosure Live (WWCR 5065 khz - Sundays 8pm eastern)
(WOYL AM-1340, Oil City, PA)
http://pages.ripco.com:8080/~glr/glr.html
(web page includes information on system to defeat Caller-ID/ANI)
-------------------------------------
------------------------------
From: Dean Ridgway <ridgwad@PEAK.ORG>
Date: 04 Jun 1995 15:53:36 -0700
Subject: Re: The Microsoft Win95 Virus - update
An update on this. A friend of mine got hold of a copy of the beta
test CD of Win95, and set up a packet sniffer between his serial
port and the modem. When you try out the free demo time on The
Microsoft Network, it transmits your entire directory structure in
background.
This means that they have a list of every directory (and,
potentially every file) on your machine. It would not be difficult
to have something like a FileRequest from your system to theirs,
without you knowing about it. This way they could get ahold of any
juicy routines you've written yourself and claim them as their own
if you don't have them copyrighted.
Needless to say, I'm rather annoyed about this.
Isn't this the same sort of thing that got Prodigy in trouble a year or
so ago? I remember reading about some class action lawsuits in
California when some lawyers found Prodigy reading confidential
lawyer/client info off their harddrives. I never heard how any of the
lawsuits turned out though.
/\-/\ Dean Ridgway | Two roads diverged in a wood, and I-
( - - ) InterNet ridgwad@peak.org | I took the one less traveled by,
=\_v_/= FidoNet 1:357/1.103 | And that has made all the difference.
CIS 73225,512 | "The Road Not Taken" - Robert Frost.
http://www.peak.org/~ridgwad/
PGP mail encouraged, finger for key: 28C577F3 2A5655AFD792B0FB 9BA31E6AB4683126
------------------------------
From: "Mich Kabay [NCSA Sys_Op]" <75300.3232@compuserve.com>
Date: 05 Jun 95 09:41:05 EDT
Subject: Mistaken Identity & Natl Smart ID
Taken from the Washington Post news wire via CompuServe's Executive
News Service:
WP 06/04 COURTLAND MILLOY
Innocently Named, Wrongly Tagged
By COURTLAND MILLOY
Pat and James Harris are used to being mistaken for other
people. When Patricia Roberts Harris ran for mayor of
Washington in 1982, Pat Harris would get telephone calls
at home requesting interviews. The same thing happened to
her husband in 1974, when James Harris became the first
black quarterback to be a regular starter in the National
Football League.
They thought that was kind of cute. But what's happening to
their son is not. Brian Anthony Harris keeps getting mistaken
for people who commit crimes.
Key points from the story:
o Ralph McLean is thought "to have shot and wounded two
uniformed D.C. police officers in January and then shot
and killed FBI agent William H. Christian Jr. before killing
himself Monday [95.05.29]. One of his aliases was
"Anthony Harris."
o Brian Anthony Harris was erroneously shadowed for two weeks until
McLean died.
o He was served with a summons for an unpaid hospital bill racked
up by another Brian Harris.
o He was erroneously accused by the FBI of fraud involving
travellers' cheques.
o He has been stopped by police in the Washington area 20 times
since 1990 because they are trying to arrest the "other" Brian
Harris. An FBI agent has now agreed to write letters for him
and make phone calls in emergencies to help him out.
[Comments from MK:
Mr Harris would benefit from a recognized, cryptographically sound
smart ID card recognized instantly by law enforcement authorities.
With the growing use of fraudulent credit cards and other identifiers
linking a pseudonym to a crime, the number of innocent victims will
also grow. A national, non-counterfeitable ID card's value to
individuals choosing to use it does not mean that everyone should be
required to carry a national ID. However, for those who would like
to be able to prove their identity instantly, such a card would be
very useful.]
--
M.E.Kabay,Ph.D. / Dir. Education, Natl Computer Security Assn (Carlisle, PA)
------------------------------
From: markm@xetron.com (Mark Malson)
Date: 05 Jun 1995 22:22:54 GMT
Subject: Re: Credit Cards in Grocery Stores
Organization: Xetron Corporation
wmcclatc@internext.com (Bill McClatchie) wrote: I have seen
something new added to my credit cards slips when purching goods at
a couple of Washington DC area grocers. They are adding the card
holders name to the slips. Wouldn't this make it easier for
someone to pick up one of these slips (which many peole just toss
in the trash) and use them?
I save all this stuff up in a folder for a month or so, and then go out
back with my big coffee can and a pack of matches and burn stuff like
this.
------------------------------
From: "Prof. L. P. Levine" <levine@blatz.cs.uwm.edu>
Date: 05 Jun 1995 19:10:42 -0500 (CDT)
Subject: Excerpts from TNO 2(5)
Organization: University of Wisconsin-Milwaukee
From: Geoff Pike <pike@CS.Berkeley.EDU>
Date: 05 Jun 1995 14:10:52 -0700
To: net.cool@ginsberg.CS.Berkeley.EDU
Subject: excerpts from TNO 2(5)
from Phil Agre's The Network Observer, May '95.
The 5/28/95 New York Times carries an article about a high school
student, Paul Kim, who published a parody "home page" for his
school on the WorldWide Web. When the school principal found it,
"without Mr. Kim's knowledge, [she] faxed letters to seven
universities to which he had applied, including Harvard, Stanford
and Columbia, informing them that she was withdrawing the school's
endorsement of his National Merit Scholarship and any
recommendations that high school administrators might have given
him." No due process, nothing. Mr. Kim only learned about this
when someone at the Columbia University admissions office called
him to ask what was going on.
------------------------------
From: Robert Gellman <rgellman@cais.cais.com>
Date: 04 Jun 1995 22:14:34 -0400 (EDT)
Subject: Exon Bill Petition
CAMPAIGN TO STOP THE EXON/GORTON COMMUNICATIONS DECENCY ACT
Update: -Bill is on the Senate floor
-Please act to help Leahy stop the Exon censorship bill
PEITION TO HELP SENATOR LEAHY STOP THE UNCONSTITUTIONAL
COMMUNICATIONS DECENCY ACT
May 19, 1995
PLEASE WIDELY REDISTRIBUTE THIS DOCUMENT WITH THIS BANNER INTACT
REDISTRIBUTE ONLY UNTIL June 9, 1995
REPRODUCE THIS ALERT ONLY IN RELEVANT FORUMS
Distributed by the Voters Telecommunications Watch (vtw@vtw.org)
HELP SENATOR LEAHY STOP THE EXON COMMUNICATIONS DECENCY ACT
The Senate is expected to on vote the Communications Decency Act (CDA,
a.k.a. the Exon Bill) within the next three weeks.
The Communications Decency Act, in its current form, would severely
restrict your rights to freedom of speech and freedom of expression
online, and represents a grave threat to the very nature and existence
of the Internet as we know it today. Without your help now, the
Communications Decency Act will likely pass and the net may never be
the same again.
Although the CDA has been revised to limit the liability of online
service providers, it would still criminalize the transmission of any
content deemed "obscene, lewd, lacivious, filthy, or indecent,"
including the private communications between consenting adults. Even
worse, some conservative pro-censorship groups are working to amend the
CDA to make it even more restrictive.
Currently, Senator Exon is negotiating with pro-censorship groups and
commercial entities that would be affected by the CDA. The voices of
Internet users must be heard now. We need to demonstrate that we are a
political force to be reckoned with.
In an effort to preserve your rights in cyberspace, Senator Patrick
Leahy (D-VT) has introduced the only legislative alternative to the
Communications Decency Act. Senator Leahy is willing to offer his bill
as a substitute for the CDA, but needs your support behind his
efforts.
Senator Leahy's legislation would commission a study to examine the
complex issues involved in protecting children from controversial
content while preserving the First Amendment, the privacy rights of
users, and the free flow of information in cyberspace.
------------------------------------------------------------------------
WHAT CAN I DO?
Please Sign the petition in support of Senator Leahy's alternative.
There are two ways to sign:
1. World Wide Web:
URL:http://www.cdt.org/petition.html
Please follow all instructions carefully. Please also put a link
to this page on your homepage.
2. email:
send email to petition@cdt.org.
Please provide the following information EXACTLY AS SHOWN.
INCORRECT SUBMISSIONS CANNOT NOT BE COUNTED!
Be sure that you make a carriage return at the end of each line
Your Name
Your email address
Are you a US Citizen (yes or no) (** IF NO, skip to last line)
Your Street Address (** USE ONLY ONE LINE)
Your City
Your State
Your Zip Code (**VERY IMPORTANT)
Country
PRIVACY POLICY: Information collected during this campaign will not be
used for any purpose other than delivering a list of signers to
Congress and compiling counts of signers from particular states and
Congressional districts. It will not be reused, sold, rented, loaned,
or available for use for any other purpose. All records will be
destroyed immediately upon completion of this project.
------------------------------------------------------------------------
THE PETITION STATEMENT
We the undersigned users of the Internet are strongly opposed to the
"Communications Decency Act" (Title IV of S. 652), which is currently
pending before the Senate. This legislation will severely restrict our
rights to freedom of speech and privacy guaranteed under the
constitution.
Based on our Nation's longstanding history of protecting freedom of
speech, we believe that the Federal Government should have no role in
regulating the content of constitutionally protected speech on the
Internet.
We urge the Senate to halt consideration of the Communications Decency
Act and consider in its place S. 714, the "Child Protection, User
Empowerment, and Free Expression In Interactive Media Study Bill", an
alternative approach offered by Senator Patrick Leahy (D-VT).
Signed:
------------------------------------------------------------------------
For More information on the Communications Decency Act issue:
Web Sites
URL:http://www.cdt.org/cda.html
URL:http://www.eff.org/pub/Alerts/
URL:http://www.panix.com/vtw/exon/
FTP Archives
URL:ftp://ftp.cdt.org/pub/cdt/policy/freespeech/00-INDEX.FREESPEECH
URL:ftp://ftp.eff.org/pub/Alerts/
Gopher Archives:
URL:gopher://gopher.eff.org/11/Alerts
URL:gopher://gopher.panix.com/11/vtw/exon
Information By auto-reply email:
If you don't have www/ftp/gopher access, you can get up-to-date
information from the following autobots:
General information on the CDA issue cda-info@cdt.org
Current status of the CDA issue cda-stat@cdt.org
Chronology of events of the CDA issue vtw@vtw.org with the
------------------------------
From: marlolas@mango.aloha.com
Date: 06 Jun 1995 09:18:27 GMT
Subject: Internet Regulations
Organization: FlexNet Inc, HAWAII
Hello, my name is Marlo, and I am a student at Hawaii Pacific
University working on my professional paper for my Masters of Science
in Information Systems degree. I would appreciate it if you would
complete the attached survey and send any additional comments or
information you may have regarding the regulation of the internet.
Thank you.
Answer the following questions by placing an "X" next to the
correct response or filling in the appropriate response in
the space provided.
1. What is your age group?
_____ a. 5-18
_____ b. 19-25
_____ c. 26-30
_____ d. 31-40
_____ e. 41-50
_____ f. 51-60
_____ g. 61-70
_____ h. over 70
2. What is your education level?
_____ a. Less than high school
_____ b. High school
_____ c. Trade School
_____ d Associates
_____ e. Bachelors
_____ f. Masters
_____ g. Doctor/Ph.D.
3. What is your occupational area?
_____ a. Clerical/Secretarial
_____ b. Administration
_____ c. Supervisory/Management
_____ d. Senior/Executive Management
_____ e. Scientific Research or Educational
_____ f. other _____________________
4. What is your gender
_____ a. Male
_____ b. Female
5. What do you primarily use the Internet for?
_____ a. Business
_____ b. Personal
_____ c. Scientific/Educational
_____ d. System Admin./Mgmt.
_____ e. Governmental
_____ f. other _____________________
6. Do you feel that the Internet has adequate security measures?
_____ a. Yes
_____ b. No
7. If the Internet is insecure, what would make it more secure?
_____ a. increased hardware/software security measures
_____ b. laws and regulations
_____ c. a group or agency to monitor the Internet
_____ d. a, b and c
_____ e. other ______________________
8. How many violations have you encountered or know of on the
Internet within a year's time?
_____ a. 1-5
_____ b. 6-10
_____ c. 11-15
_____ d. 16-20
_____ e. 21-25
_____ f. more than 25, amount _______
9. What type of violation or violations have you encountered or
know of?
_____ a. Privacy
_____ b. Libel
_____ c. Piracy
_____ d. Electronic Theft
_____ e. Pornography
_____ f. Other _____________________
9. Rank the order of importance for a given law or regulation in
each of the areas from 1 for most important to 6 for least
important:
_____ Privacy
_____ Libel
_____ Piracy
_____ Electronic Theft
_____ Pornography
_____ Other __________________
10. Who should be responsible for controlling access to the
Internet?
_____ a. Schools
_____ b. Parents
_____ c. Access Provider
_____ d. The Government
_____ e. Access Receiver
_____ f. Other __________________
11. Who should be responsible for security of the Internet?
_____ a. The Internet System Administration
_____ b. The Computer Industry
_____ c. The Government
_____ d. a, b and c
_____ e. other _____________________
12. What type of punishment should be established for violators?
_____ a. Fines
_____ b. imprisonment
_____ c. denial of Internet access
_____ d. a, b and c
_____ e. other ______________________
------------------------------
From: "Prof. L. P. Levine" <levine@blatz.cs.uwm.edu>
Date: 02 Jun 1995 20:02:39 -0500 (CDT)
Subject: Defying Pitfalls of a Cashless Society
Organization: University of Wisconsin-Milwaukee
Taken from the RISKS-LIST: Risks-Forum Digest Weds 28 May 1995 Volume
17 : Issue 15 FORUM ON RISKS TO THE PUBLIC IN COMPUTERS AND RELATED
SYSTEMS (comp.risks) ACM Committee on Computers and Public Policy,
Peter G. Neumann, moderator
From: Brian.Randell@newcastle.ac.uk (Brian Randell)
Date: 30 May 1995 16:55:55 +0100
Subject: Defying pitfalls of a cashless society
Defying pitfalls of a cashless society
Victor Keegan (The Guardian, Economics Notebook, 30 May 1995)
The kingdom of cash is starting to be attacked in a pincer movement:
from in front, by electronic, or digital, cash, and from behind, by the
growing popularity of the barter system Letts - artificial local
currencies (rather like a baby-sitting points system), which people use
instead of real money to pay each other for services rendered. [...]
The world's central banks -- including the Bank of England -- are
beginning to wake up to the fact that digital money could pose a threat
to their hegemony. This is particularly true of the so-called
"electronic purses" (like Mondex, which Midland Bank and others are
pioneering) and, much more so, the digital (and untraceable) cash
being-pioneered by DigiCash, the Amsterdam-based company. [...] As
long as these are issued by banks-like Midland's Mondex-then it is
nothing more than another bank deposit, albeit in electronic form.
[...]
Central banks have been sufficiently worried about the provision of
electronic purses getting into the wrong hands to set up a working group of
the European Monetary Institute. The conclusion was predictable: they are
all right-so long as they are restricted to approved credit institutions
(that is, banks), so that they can be properly monitored.
Enter DigiCash, whose founder, the proselytising David Chaum, wants to
create a digital system which could assume a life of its own. He has even
patented a process whereby a bank or a company could validate a secret
number which could be used as a unit of currency even though the issuing
authority could not trace it.
The place just waiting for such anonymous digital money (which would also be
rather useful for kidnappers and launderers of drug money) is the Internet,
the worldwide electronic cobweb of computer data bases. [...]
Should the Net be provided with its own currency, it would suddenly become
not only a global market place, but a virtual economy as well. It could
become the first economy without a government or even a central bank at the
centre. But if there is no government, no one will pay taxes. [...]
We are not talking science fiction. Mr Chaum has already distributed a
million digitised dollars to 5,000 pioneers taking part in a trial. Their
Cybercash can be spent purchasing goods and services from 50 companies
taking part in the trial.
At the other end of the scale, the growth of Lett schemes is not yet a
problem, if only because most of the schemes are small-scale and the people
involved are probably earning below the threshold at which they would be
required to pay tax. In a typical scheme one member might help another
build a wall, thereby earning himself currency points, to be exchanged for
work by someone else or for buying goods.
If such a scheme went nationwide and electronic (so that the participants
carried their points on a micro-chip on a plastic card), this could quickly
evolve into electronic money effectively outside the control of the banking
system and on which the participants would be reluctant to pay tax. The
transactions might even take place through the Internet.
Of course, central banks will move quickly if they feel their supervisory
role and their divine right to print money is being challenged. The point is
that the financial world is moving into uncharted waters. The change could
be as far-reaching as the transition from metals to money in the last
century.
[What I found interesting was the way this article tied together (hi-tech)
developments related to digital cash and the rise in popularity, at least
here in the UK, of (typically low-tech) barter schemes. BR]
Dept. of Computing Science, University of Newcastle, Newcastle upon Tyne,
NE1 7RU, UK Brian.Randell@newcastle.ac.uk +44 191 222 7923
------------------------------
From: "Prof. L. P. Levine" <levine@blatz.cs.uwm.edu>
Date: 29 Dec 1994 10:50:22 -0600 (CST)
Subject: Info on CPD [unchanged since 12/29/94]
Organization: University of Wisconsin-Milwaukee
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End of Computer Privacy Digest V6 #051
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