Judge OKs FBI Keyboard Sniffing

Fri Jan 4 11:26:30 EST 2002

http://www.wired.com/news/print/0,1294,49455,00.html

Judge OKs FBI Keyboard Sniffing
By Declan McCullagh

2:00 a.m. Jan. 4, 2002 PST

WASHINGTON -- The Justice Department can legally use a controversial
electronic surveillance technique in its prosecution of an alleged mobster.

In the first case of its kind, a federal judge in Newark, New Jersey has
ruled that evidence surreptitiously gathered by the FBI about Nicodemo S.
Scarfo's reputed loan shark operation can be presented in a trial later
this year.

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U.S. District Judge Nicholas Politan said last week that it was perfectly
acceptable for FBI agents armed with a court order to sneak into Scarfo's
office, plant a keystroke sniffer in his PC and monitor its output.

Scarfo had been using Pretty Good Privacy (PGP) encryption software to
encode confidential business data -- and frustrate the government's
attempts to monitor him.

Politan flatly rejected the defense argument that the FBI violated both
wiretap law and the Fourth Amendment, saying that the FBI's black bag jobs
"suffer from no constitutional infirmity."

"Each day, advanced computer technologies and the increased accessibility
to the Internet means criminal behavior is becoming more sophisticated and
complex.... As a result of this surge in so-called 'cyber crime,' law
enforcement's ability to vigorously pursue such rogues cannot be hindered
where all constitutional limitations are scrupulously observed," Politan
said.

Scarfo's lawyer said he was "very disappointed" but he could see no way to
appeal Politan's decision before the trial takes place. "If we should be
convicted, it'll come up on appeal," said Norris Gelman, a Philadelphia
attorney representing Scarfo.

Privacy scholars who fear that Politan's ruling will dramatically expand
the government's ability to spy on Americans have closely watched the case.
If Politan's decision is upheld on appeal, it will grant police broad
powers to circumvent privacy-protecting encryption products.

"The decision is disappointing, particularly in light of the fact that the
full details of the keystroke logger were not disclosed to the defense,"
said David Sobel, general counsel for the Electronic Privacy Information
Center. "It's an important issue that is likely to form the basis of an
appeal should Scarfo be convicted."

For its part, the FBI seems to want to avoid the physical
breaking-and-entering that's required to implant a keystroke logger in a
suspect's computer. Late last year, news leaked about an FBI project
code-named "Magic Lantern" that would install surveillance software
remotely using well-known backdoors in browsers, e-mail clients and
operating systems.

Ronald Wigler, the assistant U.S. Attorney responsible for the case, said:
"There has not been another case of its kind to date that has utilized
these methods in conjunction with the way in which we obtained
authorization to use these tools."

"(The court decision) doesn't necessarily surprise us because we've been
saying all along we never violated his Fourth Amendment rights. We've been
saying all along we've never captured any electronic communications that
would require us to seek a wiretap order," Wigler said.

The court order from the federal magistrate judge stated that the FBI could
"install and leave behind software, firmware, and/or hardware equipment,
which will monitor the inputted data entered on Nicodemo S. Scarfo's
computer in the target location so that the FBI can capture the password
necessary to decrypt computer files by recording the key related
information as they are entered."

Defense attorneys had said that the PGP pass-phrase snatching was akin to a
telephone wiretap and pointed out that the FBI never obtained a wiretap
order. Scarfo's lawyers also claimed the FBI was conducting a general
search of the sort loathed by the colonists at the time of the American
Revolution and thereafter outlawed by the Fourth Amendment's prohibition of
"unreasonable" searches.

Complicating the case is the government's unwillingness to release details
on how the keystroke-capturing system works. The government calls the
key-logger "a sensitive law enforcement" mechanism that's classified -- and
that its details, like the secret locations of bugs and surveillance
devices, may be kept from defendants.

Last fall, the Justice Department invoked the Classified Information
Procedures Act (CIPA), which allows prosecutors to brief the judge in a
secret session from which defense attorneys and the defendant are excluded.
That ex parte hearing took place on Sept. 26.

"Pursuant to CIPA's regulations, the United States presented the Court with
detailed and top-secret, classified information regarding the (keystroke
logger), including how it operates in connection with a modem. The
government also demonstrated to the Court how the (keystroke logger)
affects national security," Politan said in his decision.

Defense attorneys received only an "unclassified summary statement" with
general information about the key-logging system.

The Justice Department says that Scarfo's encrypted file, titled "Factors,"
contains evidence of an illegal gambling and loansharking operation.

Because Politan is retiring soon, a new judge will take over the case and
set a trial date, which will likely take place this year.