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Fraud
& Security
The
Internet can be a wonderful place to grow your business,
improve yourself, and just have fun. However, with
any new technology, there are dangers and pitfalls
that should be avoided. In this section, the IMEX
Exchange will try to expose some of those dangers
and risks. It is incumbent upon you, the user, to
take the necessary precautions to avoid the dangers
while enjoying the riches the Internet offers.
WARNING
Users of the IMEX Exchange are urged to make appropriate
inquiries and seek necessary counsel BEFORE entering
into any business arrangement, or sending any money,
or incurring any expense of any kind in relation to
an advertisement or offering on the IMEX Exchange.
The IMEX Exchange, Inc. shall not be liable for any
loss or damage incurred as a result of accepting an
offer or doing business resulting from an advertisement
or offering on the IMEX Exchange.
ONLINE
SCAMS
Stories (to laugh at or not) about online scams and
the sometimes suckers who fall for them. c|net
online exposes these scams and tells you what
you can do to help protect yourself.
See:
WATCH
YOUR DATA
Computer security must be a priority for all organizations.
Work with your MIS group to insure that appropriate
firewalls and security proceedures are in place. Use
complex passwords and change them regularly. Develop
proceedures for the use of encryption technology.
Don't make it easy for your computer system to be
broken into by hackers on the Internet.
There
are several companies and programs that can help secure
your systems. A most recent development in Internet
security is a software program called “Satan”
developed by Dan Farmer and Wietse Venoma. This program
is available free to anyone on the Internet. Its purpose
is to help administrators of computer systems locate
security holes as plug them. The objective is to keep
hackers out. However, “Satan” critics suggest
that the program will be a road map for amateur hackers
and may increase hacking break-ins.
COMPUTER SECURITY ORGANIZATIONS
For more information on computer security, check with
the experts:
•Forum
of Incident Response and Security Teams - FIRST
•National
Computer System Security and Privacy Advisory Board
- CSSPAB
•Computer
Emergency Response Team - CERT
- Subscribe to CERT advisories (cert-advisory-request@cert.org
)
•Australian
Computer Emergency Response Team - AUSCERT
SECURING CYBERSPACE
For the more advanced computer user, check out the
November 1994 issue of Communications of the ACMdevoted
to Internet security covering such issues as cryptosystems,
security protocal, denial of service, licensing requirments
for new access control techniques, smart cards, and
more.
For
more information, contact the Association
for Computing Machinery, 1515 Broadway, New York,
NY 10036, Telephone: 212-869-7440.
PHONY STOCK DEAL
Remember, if it is too good to be true, it probably
isn’t. This was illustrated when NetGuide Magazine
exposed a scam in which stock of a Canadian company
was offered for sale at 35 cents a share on Prodigy.
Along with the offer was a stock analyst’s prediction
that the stock would soon rise to $2 a share. In reality,
the son of the company owner was posing as the stock
analyst, and the company was not registered with the
proper authorities to sell stock.
Source:
February 1995 issue of NetGuide Magazine article titled
“Rook of the Month Club", pp. 79-80
SEC BLOCKS SALES OF ALLEGEDLY
UNREGISTERED SECURITIES ON THE INTERNET
“The Securities and Exchange Commission has won
its first court order blocking the sale of allegedly
unregistered securities over the Internet.” It
was report that the alleged fraud brought in $3 million
and has operated in different countries. Memberships
were sold as a worldwide lottery and the “SEC
contends the memberships were actually investment
contracts that required registration with the commission.”
Source: New York Newsday, Thursday, March 16, 1995,
p. A38
NET GUIDELINES FOR INVESTORS
NetGuide Magazine offers the following tips for on-line
investors:
1.“Don’t
believe the hype” - Hot Tips, Make Money Fast
are all flags to be careful.
2.“Forget
about the usual safety nets.” - Government agencies
may not be watching and often scam artists on the
Information Highway disappear without a trace.
3.“Never
rush into anything” - Patience can be a virtue.
4.“Be
discerning” - Because it on the Net doesn’t
mean that it is accurate, even experts can be wrong.
Use your best judgment.
5.“Do
report any scams you come across” - Report them
to your online service and the appropriate securities
commission or law enforcement agency.
ELECTRONIC PAYMENTS
One of the more challenging issues facing business
and programmers on the Internet is electronic payment
of funds. Never send your credit card number by ordinary
e-mail. It can be intercepted and read. To prevent
hackers from stealing credit card numbers, several
groups have joined forces to develop safe, secure,
and hopefully easy to use systems for the transfer
of funds on the Internet. Here is a list of some of
the efforts:
•Cybercash
- Encryption of credit card data headed by Wells Fargo.
•Digicash
- Anonymous electronic cash system.
•First
Virtual Holdings - E-mail system for small transactions.
•Microsoft
- Credit card transactions with VISA
•Mondex
- Smart card system developed by British banking venture.
•Netscape
- Eencryption and validation built into its Web software
partnered with MasterCard, Bank of America, and MCI.
Several
issues relating to Electronic Payments need to be
resolved such as (1) will there be too many standards,
(2) IRS’s will be reluctance to accept the untraceable
digital money aspect of the Internet, and (3) who
is going to get a piece of the action on each transaction?
This year and next, electronic payment test projects
will be underway. The IMEX Exchange will keep you
posted.
COPYRIGHT LAW
Obtain the latest facts and commentary about copyrighting
on-line data by checking out the following sites.
•Working
Group on Intellectual Property Rights report with
proposed changes on the Copyright Act of 1976 and
addresses electronic publishing.
•WWW
Virtual Library has a listing of law-related internet
sites.
•Coalition
for Networked Information has a large selection of
material relating to copyright issues.
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