Attorney General Janet Reno revealed
details of her anti-cybercrime network yesterday that will combine
authorities from federal, state and local agencies to stop Internet
lawbreakers. However, she left a key question unanswered: how to pay
for it.

“I envision a network that extends from local detectives to the FBI
to investigators abroad,” said Reno in her description of “LawNet” to
several hundred members of the National Association of Attorneys
at the group’s meeting Monday at
Stanford University.

LawNet is to include teams of highly skilled computer crime
prosecutors and investigators, regional forensic computer laboratories
and technology sharing, allowing expensive items to be used by more than
one agency, Reno said.

The nation’s top cop also proposed a new interstate compact to help
ensure enforcement of out-of-state subpoenas and warrants stemming from
Internet investigations.

The LawNet proposal partially addresses a presidential directive
issued last year by President Clinton, encouraging all of the most
important industries in the country — including law enforcement — to
set up information sharing networks.

“The Internet is indeed a splendid tool of wonder, but there is a
dark side of hacking, crashing networks and viruses that we absolutely
must address,” she said.

With e-commerce expected to reach $1 trillion in 2003, opportunities
for cybercrime abound. A recent FBI survey of Fortune 500 companies
found 62 percent reported computer security breaches during the past
year, said Reno.

“The unfortunate side effect of the Internet’s tremendous growth has
been that it provides criminals with a new opportunity to reach a mass
of potential victims,” said Christopher Painter, a federal prosecutor
who focuses on computer crime, in an Associated Press report.

Prosecutors at the conference favored the LawNet proposal, saying
that the increase in criminal opportunities creates a need for new law
enforcement tools, a claim that raises the question of cost.

To fund law enforcement patrols and fire protection for traditional
“brick-and-mortar” merchants, local governments typically impose on area
business the costs associated with these government services — in the
form of taxes and business licenses.

While e-commerce websites may not go up in flames, law enforcement is
necessary, according to Reno, except this time the new entity is not
simply a merchant, but an entire industry — one for which Reno is ready
to create a new form of law enforcement.

But law enforcement costs money and taxpayers must foot the bill,
leading many to believe a new Internet tax will be collected to cover
those costs.

“[The Clinton administration has] zero standing to advise the rest of
this country about this issue,” said Grover Norquist, president of
Americans for Tax Reform, in an exclusive
WorldNetDaily interview. “They’ve been leading the fight for taxing
electronic commerce which will take billions of dollars from consumers
— many more billions than cyber-criminals ever would.”

“The people to fear are not a handful of embezzlers, but the federal
tax collectors who want to take people’s resources,” he added.

Currently, the Congressional Advisory Committee on Electronic Commerce is debating the issue of
a Net tax and will report its findings and recommendations to Congress
in the spring. Arguments in favor of a Net tax have centered around the
“fairness” of Internet merchants being exempt from sales tax while
brick-and-mortar merchants must collect the tax.

A new anti-cybercrime network could be used as leverage for
collection of e-commerce sales taxes.

Reno said a significant part of LawNet would be to address questions
of jurisdiction, a challenge prosecutors said they face when fighting
Internet crime.

David Johnson, director of the Cyberspace Law Institute, said in an
Associated Press story that it would be optimal if businesses were to
comply with laws in the place they are located — an argument currently
being used for Internet tax jurisdiction.

Johnson said state lawmakers want residents to be protected by the
same set of rules “as if they had walked out their door.”

“We’re facing an overlapping tapestry of laws,” he said.

To solve the problem, Johnson proposed allowing online businesses to
choose which region will have jurisdiction over them as well as the
creation of an online arbitrator or court.

Privacy issues would also need to be addressed by LawNet, said Reno,
in order to protect consumers from abuses. One example of such an abuse
is the CD Universe extortion case in which a hacker stole credit card
numbers from the Internet music retailer and posted them on a website
after it refused to pay a $100,000 ransom.

New York Attorney General Eliot Spitzer agreed that computer users
are vulnerable to inadvertently sharing everything from their bank
accounts and tax records to book selections and movie choices.

“It is perhaps not Big Brother we should be worried about, but big
browser,” he said. “We need to be fearful that the aggregation of
information, if it is misused, is very terrifying.”

Unfortunately, “Big Brother” often ends up being the prying eyes
consumers fear.

“This is an administration that has been hostile to the idea of
privacy online,” said Norquist. “You don’t improve people’s privacy by
putting a cop in every bedroom or all over the Internet.”

See WorldNetDaily’s “Don’t tax the Net!” petition.

Related story:
Net Tax in Limbo

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