Cyber Ramblings - July 24, 2001

24 July 2001
Compiled by Kevin Smith

Ashcroft Targets Computer Crimes

Calling computer security one of the nation's top problems, U.S. Attorney General John Ashcroft said Friday that the government is forming nine special units to prosecute hacking and copyright violations.

Ashcroft said the new specialists would give the Justice Department 48 prosecutors working on cybercrime in U.S. attorneys' offices.

"There are many people of poor and evil motivations who are seeking to disrupt business and government and exploit any vulnerabilities in the digital universe,'' Ashcroft said after a meeting with Silicon Valley executives and venture capitalists.

When computer crimes go unpunished, he said, "it impairs the ability of the United States of America to remain in its position of priority in leading the world in the digital age.''

The new prosecutors will work in cities with relatively high levels of cybercrime: Los Angeles, San Diego, Atlanta, Boston, Dallas, Seattle, New York, Brooklyn, N.Y. and Alexandria, Va. The units will be modeled on the nation's first computer hacking and intellectual property squad, which began working out of the U.S. Attorney's office in San Francisco several years ago.

That unit was created by U.S. Attorney Robert Mueller, whom President Bush has nominated for FBI director. Mueller attended Friday's news conference at the headquarters of VeriSign Inc., but did not comment.

Kmart Taking over

Kmart Corp. announced Monday that it is taking over LLC, the independent company that runs the retailer's Internet sales operation.

Kmart said it would acquire all the shares and interests of it doesn't currently own by Aug. 1.

Based in San Francisco, is an independent company majority owned by Kmart.

The move follows an announcement made in May that will improve its efficiency and profitability by using the resources of Kmart Corp.

Part of that plan meant the online retailer would use the marketing and merchandising resources of Kmart, and eliminate some jobs in its merchandising and marketing departments. Can Do No More Good, an Internet company that operated websites to fight world hunger and rainforest destruction, has shut down. The company closed Tuesday after its board of directors decided not to invest more money, the Seattle Post-Intelligencer reported Saturday.'s most popular sites included The Hunger Site and The Rain Forest Site.

The Hunger Site alone attracted about 600,000 visitors a day and brought in more than $4 million in donations for the U.N. World Food Program, America's Second Harvest and Mercy Corps International.

The for-profit, founded in 1999, raised more than $20 million from investors and employed about 26 people. Other sites operated by the company included The Breast Cancer Site and The kidsAIDS Site.

Hotmail Users Surprised By Upgrades

Hotmail users got a surprise Thursday when they logged on to find the e-mail service had been upgraded. After several false starts this week, with some other Microsoft Network (MSN) services being affected Tuesday as Hotmail installed the upgrade, the latest version went live without any apparent major hitches.

Besides a new look similar to MSN Explorer, two additional languages, clearly-labeled tabs and icons and a "Quick Address List" are among the new functions of the Web-based e-mail application.

Rick Holzli, director for MSN Hotmail at Microsoft told the Associated Press that the company's intent in the upgrade was to create for its users a "better way to handle their e-mail and protect themselves from spam."

Worm Targets White House Site

An Internet worm dubbed "Code Red" failed to shut down the White House website, even after marshaling the power of hundreds of thousands of computers in its attack.

The worm infected more than 225,000 computer systems around the world, computer security experts said. The virus defaced websites maintained by those computers with the message "Hacked By Chinese," but the origin of the virus is unknown.

The ultimate goal of the program is to gather strength by spreading among computers and then have them all attack a numerical Internet address that represents the White House website.

Chinese Government Shuts Down Internet Cafes

China has shut down nearly 2,000 Internet cafes across the country and has ordered 6,000 to suspend operations and make changes, the state media said on Friday.

Anonymous cyber cafes are popular because they allow people to evade tough content laws, whose infringement on a personal homepage or message board authorities are likely to track to its source.

The Shanghai Daily said the move, China's second major clampdown on the popular cafes in a little more than a year, aims to regulate the Internet service market in line with rules set by the Ministries of Information Industry, Public Security and Culture and the State Administration of Industry and Commerce.

More than 56,800 Internet cafes or bars have been inspected during a probe that began in April, the newspaper said. It said police closed 53 Internet bars and ordered 59 others to suspend operations for "rectification and improvement" in Nanjing in the eastern province of Jiangsu.

Internet bars have mushroomed in China since first appearing in big cities in 1997. Mini-cyber bars can now be found in bookstores, barbershops, clothes stores and even the butcher's. To the government, they open the door to a dangerous world outside the Communist Party's control.

To the people, they offer an opportunity to speak with anonymity, making cyberspace almost impossible to regulate despite a slew of high-profile arrests since March.

Virus Uses Fake Security Bulletins

Two viruses disguised as Microsoft security bulletins--complete with a phony website and software patches--are not considered a major threat, but they are reminding computer users that "security" is often suspect.

One virus, discovered July 10 and called W32.Pet_Tick.G, arrives as an e-mail with the message, "This is a fix against I-Worm.Magistr." It also includes an executable file attachment titled "MSVA.EXE."

The other fake bulletin, W32.Leave.B.Worm, warns of a serious virus and recommends running the attached patch, which is actually malicious code.

While capable of self-spreading via e-mail and crippling infected computers; the impostors are easily identified and prevented with anti-virus software, according to security experts.

However, the bogus Microsoft bulletins mark a trend in social engineering--hackers' efforts to trick users--and could put computer security information on par with pornography in terms of creating viruses.

Russian Hacker Arrested after Speaking at Conference

A Russian computer programmer who gave a presentation at the DefCon hacker convention in Las Vegas last weekend has been arrested by the FBI on charges that he wrote a program that allegedly circumvents a controversial U.S copyright law.

Dmitry Sklyarov, 26, was arrested in his room at the Alexis Park Hotel on Monday as he prepared to check out and return to Moscow, said special FBI agent Daron Borst on Tuesday.

Sklyarov was ordered to be held without bail during an initial appearance in federal court in Las Vegas on Monday and will be transferred to San Francisco, where he has been indicted on charges of trafficking in software to circumvent copyrighted materials, Borst said.

While there have been civil cases brought under the 1998 Digital Millennium Copyright Act (DMCA), this is one of the first criminal cases brought under the controversial law, lawyers said.