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Chapter 10

Public Policy: From Legal Issues to Policy

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Legal and Ethical Issues

PrivacyIntellectual Property

Difficult to protect since it is easy and inexpensive to copy and disseminate digitized information

Free SpeechInternet provides the largest opportunity for free speech; but, some postings are offensive to people

TaxationIllegal to impose new sales taxes on Internet business at the present time (U.S. and some other countries)

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Legal and Ethical Issues (cont.)

Computer crimesUsually refers to computer fraud and computer abuse

Consumer ProtectionMany legal issues are related to electronic trade

Other legal issuesValidity of contracts, legality of public key encryption infrastructures, jurisdiction over trades, encryption policies

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Ethical Issues

What is considered to be right and wrong?What is unethical is not necessarily illegal.Whether these actions are considered unethical depends on the organization, country, and the specific circumstances surrounding the scenarios.

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Ethical Issues (cont.)

Code of EthicsA collection of principles intended as a guide for its membersMany companies and professional organizations develop their own codes of ethicsA guide for members of a company or an association

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A Framework for Ethical Issues

Privacy—regarding information about individuals

CollectionStorageDissemination

PropertyOwnership and value of information and intellectual property

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A Framework for Ethical Issues (cont.)

Accuracy of:AuthenticityFidelityInformation collected and processed

AccessibilityRight to access information Payment of fees for the access

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Protecting Privacy

PrivacyThe right to be left alone and the right to be free of unreasonable personal intrusions

Information PrivacyThe “claim of individuals, groups, or institutions to determine for themselves when, and to what extent, information about them is communicated to others”

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Protecting Privacy (cont.)

Two basic rulesThe right of privacy is not absolute. Privacy must be balanced against the needs of societyThe public's right to know is superior to the individual’s right of privacy

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How is Private Information Collected?

Reading your newsgroups’ postings

Finding you in the Internet DirectoryMaking your browser record information about youRecording what your browsers say about you

Reading your e-mail

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Protecting Your Privacy

Think before you give out personal information on a siteTrack the use of your name and informationKeep your newsgroups’ posts out of archivesUse the Anonymizer when browsingLive without cookies

Use anonymous remailersUse encryptionReroute your mail away from your officeAsk your ISP or employer about a privacy policy

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Legislation

The Consumer Internet Privacy ActThe Federal Internet Privacy Protection ActThe Communications Privacy and Consumer Empowerment ActThe Data Privacy Act

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Personal Information in Databases

Databases of:Banks and financial institutionsCable TVTelephonesEmployersSchoolsInsurance companiesOnline vendors

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Personal Informationin Databases (cont.)

ConcernsData collectionData accuracyData confidentiality

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Protecting Intellectual Property

CopyrightA statutory grant that provides the creators of intellectual property with ownership of it for 28 years

Trade SecretIntellectual work such as a business plan, which is a company secret and is not based on public information

PatentA document that grants the holder exclusive rights on an invention for 17 years (U.S.)

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Copyrights

Protects original expression of ideasLiterary worksMusical worksDramatic worksArtistic worksSound recordings, films, broadcasts, cable programsPublished editions of literary and musical works

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Copyright Protection Techniques

Digital watermarksEmbedding of invisible marksCan be represented by bits in digital contentHidden in the source data, becoming inseparable from such data

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International Aspects of Intellectual Property

The World Intellectual Property Organization

More than 60 member countries come up with an international treatyPart of the agreement is called the “database treaty”

Its aim is to protect the investment of firms that collect and arrange information

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Patents

Patent—a document that grants the holder exclusive rights on an invention for 17 years

Satisfy following legal criteriaNovel—does not already exist as part of the public domainInvolves sufficiently “inventive step”Capable of individual application (be put to practical use)

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Trademarks

Trademarks—graphical sign used by businesses to identify their goods and servicesGives exclusive rights to:

Use trademark on goods and services registered to that signTake legal action to prevent anyone from using trademark without consent

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Domain Names

Domain name refers to the upper category of Internet address (URL)Three controversies

Whether top-level domain names (similar to com, org and gov) should be addedThe use of trademark names by companies for domain names that belong to other companiesIf companies in different countries have the same name, who can use it as the domain name?

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Defining Freedom of Speech

The Bill of Rights First Amendment to the Constitution of the U.S. of America reads:

“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.”

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The Debate AboutFree Speech on the Internet

Free speech debate“Most citizens are implacably opposed to censorship in any form — except censorship of whatever they personally happen to find offensive.”The debate: what restrictions, if any, should there be on Internet content, and how should it be monitored?

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The Debate AboutFree Speech on the Internet (cont.)

What are the boundaries, and how should they be enforced?

Governments protective of their role in societyParents concerned about exposing their children to inappropriate Web pages and chat roomsFederal agencies attempting to deal with illegal actionsCitizen action groups desiring to protect every ounce of their freedom to speakIndividuals concerned about their right to information on the InternetOrganizations seeking to empower the citizens of the earth

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Protecting Children

3 approaches (regarding the protection of children from inappropriate material on the Internet)

No information should be held back and parents should be responsible for monitoring their own childrenThe government is the only one who can truly protect children from this materialTo hold the Internet providers responsible for all the material and information they provide, or enable access to it

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Protecting Children (cont.)

Parents governing their own childrenGovernment protecting the childrenResponsibility of the Internet providersForcing Internet providers to be accountable, or enable access to information

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Legal Perspectives in the USA

Child Online Protection ActInternet Tax Freedom ActFamily Friendly Internet Access ActInternet Protection ActInternet School Filtering Act

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Controlling Spamming

What is spamming, why is it bad?Spamming

“The practice of indiscriminate distribution of messages (for example junk mail) without permission of the receiver and without consideration for the messages’ appropriateness”

Spam comprised 30% of all mail sent on America Online (in the past, now less than 10%)Slows the internet in generalShuts ISPs down completely

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Legislation, LegalThe Electronic Mailbox Protection ActThe Unsolicited Commercial Electronic Mail ActThe Netizens Protection ActThe Telephone Consumer Protection Act

Controlling Spamming (cont.)

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Controlling Spamming (cont.)

How to cut spammingTell users not to validate their addresses by answering spam requests for replies if they want to be taken off mailing listsDisable the relay feature on SMTP (mail) servers so mail cannot be bounced off the serverDelete spam and forget it— it’s a fact of life and not worth wasting time overUse software packages, e.g. getlost.com and junkbusters.com

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Other Legal Issues

What are the rules of electronic contracting, and whose jurisdiction prevails when buyers, brokers, and sellers are in different states and/or countries?How can gambling be controlled on the Internet? Gambling is legal in Nevada and other states. How can the winner’s tax be collected? By whom?When are electronic documents admissible evidence in the courts of law? What do you do if they are not?

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Other Legal Issues (cont.)

Time and place can carry different dates for the buyers and sellers when they are across the ocean. Which time should be considered?Is a digital signature legal?The use of multiple networks and trading partners makes the documentation of responsibility difficult. How is such a problem overcome?

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Electronic Contracts

Uniform Electronic Transactions ActUniform Commercial Code (UCC)Shrink-wrap agreements (or box-top licenses)

The user is bound to the license by opening the package

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Computer Crimes

Computer crimes refers to computer fraud and/or computer abuseComputer fraud committed by:

Alteration of inputAlteration of computer dataAlteration/misuse of programsDestruction/suppression/misappropriation of output

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Computer Crimes (cont.)

Computer abuse committed by:Misuse of company computer service/resources by performing unauthorized private work or playing games by employeesCompromise of system integrity by:

Altering company dataIntroducing virusesHacking into the system

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Computer Crimes (cont.)

Characteristics of computer crimeChronic underreporting of abuseSecurity not introduced until abuse has occurredOrganizational size unrelated to severity of punishmentAbuses by high-level employees less likely to be prosecutedProgrammers most difficult to identifyPublicity discourages abuseSecurity efforts reduce abuse

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Computer Crimes (cont.)

Effective measures in deterring computer crime

Make computer security visibleDefine and communicate company’s policy regularlyMake staff aware of penaltiesReport cases to policePublicize successful prosecutionDeploy security technologies extensively

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Fraud on the Internet

Internet Stocks FraudSEC brought charges against 44 companies and individuals who illegally promoted stocks on computer bulletin boards, online newsletters and investment Web sites

Other Financial FraudSelling bogus investments, phantom business opportunities, and other fraud schemes

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Fraud on the Internet (cont.)

Other Fraud in ECCustomers may:

Receive poor quality products and servicesNot get products in timeBe asked to pay for things they assume will be paid for by sellers

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Authentication

If authentication online can be verifiedStudents will be able to take exams online from homeFraud of recipients of government entitlements and other payments will be reduced to a bare minimumBuyers will be assured who the sellers are and sellers will know who the buyers are with a very high degree of confidence

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Biometric Controls

Matching against a template:Photo of faceFingerprintsHand geometryBlood vessel pattern in the retina of a person’s eyeVoiceSignatureKeystroke dynamicsIris

Cathy .

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What Can Vendors Do?

Use intelligent software that signals questionable customersDevelop a list of warning signals for possibly fraudulent transactionsAsk customers to have shipping address added to their bank account if different from billing address

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Managerial Issues

Multinational corporations face different cultures in the different countries in which they are doing businessIssues of privacy, ethics, and so on may seem to be tangential to running a business, but ignoring them may hinder the operation of many organizations

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Managerial Issues (cont.)

The impact of EC and the Internet can be so strong that the entire manner in which companies do business will be changed, with significant impacts on:

ProceduresPeople Organizational structure Management Business processes