Task Force Battles Online Criminals
Ground zero in California’s war against Internet crime is behind a dumpster hard by a hamburger stand in a faded Sacramento County welfare building.
This is the headquarters of the Sacramento Valley high-tech task force, a multi-agency law enforcement team dedicated to tracking down e-crime, from stock swindlers to child pornographers.
It was from this war room--a warren of computers and cubicles staffed by a gun-toting megabyte “Mod Squad”--that investigators last month pursued a 16-year-old hacker from Los Angeles who gained access to the account files of 63,000 Pacific Bell Internet subscribers.
The episode--made public earlier this month--was among the latest in a series of Internet crimes that have offered a glimpse at the extent of the problem. Among other cases cited by authorities are that of a Russian teenager who stole thousands of U.S. credit card numbers from an Internet CD outlet and a pedophile lured to Sacramento by a police sting operation.
The explosive growth in illegal Internet activity led state and federal prosecutors from around the nation to gather recently at Stanford University to coordinate efforts to track cyber-miscreants.
Even as they were buzzing about how the planned merger of America Online and Time Warner confirms the Internet’s central role in modern life, they acknowledged that there is a lawless flip side to the booming commercial world of the Internet.
“It’s the new frontier, not only in terms of being a productive tool . . . but also there’s a dark side. It’s a harmful tool used by criminals,” said Christopher Painter, who heads the Internet crime unit in the U.S. attorney’s office in Los Angeles.
“We’ve seen this dramatic rise in the Internet and the number of people who rely on it for financial transactions, and a concomitant rise in crime,” said Painter, who participated in the conference.
The underside of the high-tech trend is spotlighted by a set of figures gathered by an arm of the governor’s office and tucked in a report--the first of its kind--to be released in the coming weeks.
The report, which covers nine months ending last Nov. 30, found that high-tech crime in California accounted for at least $6.5 billion in losses due to theft, fraud and other causes; lost wages of $923 million; and tax losses totaling $358 million. Plus an estimated 19,000 high-tech jobs have been lost, according to state officials, who call these estimates extremely conservative.
With California at the center of high-tech commerce, those numbers “shouldn’t seem to anybody as an exaggeration,” said John Reece, chief counsel for the governor’s Office of Criminal Justice Planning that oversees the state’s battle against high-tech crime.
But is California, lauded at the Stanford conference for being in the vanguard of fighting high-tech criminals, pumping enough money into the fight?
In the last fiscal year the state dedicated $1.2 million to finance three task forces designed to catch Internet criminals in Los Angeles, the Silicon Valley and Sacramento.
State officials say they have slowly been building support, educating the public and politicians and are now gathering data to demonstrate the magnitude of high-tech crime. Armed with that information, they expect budgets for computer cops to mushroom in coming years.
“It doesn’t make much sense to throw $100 million at a problem that you don’t understand,” Reece said.
But state spending on the task forces has been tripled in the current fiscal year to add two more teams in other parts of California, possibly including San Diego.
The ability of online crooks to disrupt day-to-day life is just dawning on state prosecutors across the nation. They say that in the early days of the Internet the public voiced skepticism about doing business online. Now, however, users are more trusting, opening the door for criminals.
Citing the mounting abuses, U.S. Atty. Gen. Janet Reno told the conference that state prosecutors and federal officials need to form a national computer crime-fighting network. In her speech, she urged state officials to meet with her in Washington to hammer out a new strategy.
In no place is the rise of the Internet more evident than in California. State Atty. Gen. Bill Lockyer, who hosted the Stanford conference, estimated that 85% of all Internet traffic flows through one spot in the Silicon Valley.
Unlike traditional criminal activity, cyber crime is a borderless enterprise, providing a challenge to online authorities. Someone sitting at a computer terminal in the Midwest can promote an illegal get-rich-quick scheme in Los Angeles. Early this month the Sacramento task force announced the arrest of a man who had unwittingly been chatting on line since September with someone he thought was a 13-year-old boy, but who was in fact a sheriff’s deputy engaged in a sting operation.
The suspect flew from Minnesota to Sacramento, rented a hotel room and paged the “teenager.” The 30-year-old man was arrested on charges of attempting to commit a lewd act on a child and to provide lewd material to a minor, according to the task force.
One reason the Legislature in 1998 channeled money to regional law enforcement teams was that lawmakers thought it would be too much of a challenge for a single department to track sophisticated high-tech crime organizations.
Today, about half the Sacramento-area team’s work deals with pulling data out of computers stacked inside the busy office. The headquarters is expected to move to new digs, complete with a computer laboratory, later this year.
Damian Frisby, an El Dorado County detective assigned to the task force, helped break the Pacific Bell case. After being contacted last December by an Internet service provider, agents within an hour identified a 16-year-old in the San Fernando Valley as a suspect.
The unidentified youth is expected to be charged with unlawful possession of the computer material.
Frisby and the other investigators eventually determined that the hackers may have had access to at least 26 other Internet providers and private companies overseas and in the United States.
Even though such criminals have a global reach, Frisby said, “more often than not it comes back to the old-fashioned police work” to break the cases.
