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FBI, NSA Win Fight for High-Tech Eavesdropping : Communications: White House ruling gives agencies continued access to coded phone, computer messages. Export limits on encryption devices remain.

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THE WASHINGTON POST

The Clinton Administration on Friday rejected the arguments of the computer industry and civil libertarians and sided with national security agencies that sought to guarantee their ability to intercept and decode messages sent over computer and telephone lines.

The White House had agreed to review initiatives begun during the George Bush Administration--and pursued under President Clinton--that favored the FBI and the National Security Agency in their efforts to ensure that the agencies can continue to read and listen to communications despite rapidly evolving encryption technologies.

The Commerce Department announced Friday that a nine-month review of the issue--which has set off impassioned disputes between high-technology industries and the government--had resulted in a decision to make no major policy changes.

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That means the Administration will continue longstanding restrictions on exports of powerful encryption devices that the NSA cannot crack, and continue to encourage use of NSA-developed encryption gear, called the “Clipper Chip,” by all U.S. firms. The Clipper Chip makes it relatively easy for the government to eavesdrop on encrypted communications.

Administration officials said that the “keys” to unlock messages would be held by the National Institute of Standards and Technology and the Treasury Department. Police agencies obtaining court authority to wiretap will go to those agencies to acquire the two-part key.

Taken together, the actions are seen by computer and software companies as a government attempt to keep powerful encryption technology out of both foreign and domestic markets.

Further, government officials said, the Administration is expected in a few weeks to endorse an FBI proposal that U.S. telecommunications firms be required to guarantee that law enforcement agencies will have the ability to tap phone and computer lines regardless of where the technology goes.

At the core of these high-tech disputes lies a fundamental conflict between Americans’ cherished privacy rights and the government’s investigative needs.

Consumers have long known that most of their business transactions are recorded in corporate and government databases that are already shuttled around the country on communications lines.

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The prospect of an information superhighway that puts even more transactions on-line--from medical records to pay-per-view movie selections--raises the ante.

“We can’t just trust legal protections,” said Jerry Berman, chairman of a coalition of business executives and civil libertarians fighting the Administration plan.

However, James K. Kallstrom, the FBI’s technology chief, said that without wiretapping capabilities, “you’re building a sanctuary for criminality to go unfettered.”

U.S. high-tech executives say the Administration’s position will prove to be in vain because terrorists and criminals can already buy powerful encryption technologies worldwide.

The Business Software Alliance, which represents firms such as Microsoft Corp., Novell Inc. and Apple Computer Inc., on Friday expressed “deep disappointment and regret” about the Administration’s stance.

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