October 2006
James Earl, Executive Director, Advisory Board for the Nevada Task Force for Technological Crime
Nevada leads the nation with the highest per capita rate of perpetrators of Internet fraud, according to the latest report from the Internet Crime Complaint Center, a partnership between the FBI and the National White Collar Crime Center.
“Internet fraud” is an umbrella term which includes Internet auction fraud, non-delivery of goods ordered over the Internet, credit/debit card fraud with an Internet component, Internet investment fraud, and Internet identity theft.
In 1999, when Internet fraud was in its infancy, Nevada defined “technological crime” in statute (NRS 205A) and established a joint executive-legislative agency to address the foreseen challenges. The Advisory Board for the Nevada Task Force for Technological Crime has specific duties. Among them are (1) to facilitate cooperation among state, local and federal law enforcement agencies, (2) to establish two multi-agency task forces, north and south, to address technological crimes, (3) to coordinate and provide training for the general public, private industry and governmental agencies, (4) to administer a program securing governmental information systems, and (5) to evaluate and recommend changes to existing civil and criminal laws.
Most of us would likely consider “technological crime” to be roughly the equivalent of “Internet fraud,” adding perhaps Internet child pornography and other Internet-based crimes against children. However, the statutory definition is considerably broader. In essence, “technological crime” in Nevada means any crime that involves “directly or indirectly” any device or network that can be programmed or can store or transmit any information in any technological format. As a result, a drug sale arranged via a cell phone call involves a technological crime, as does a first-degree murder where the perpetrator researched drug interactions or body disposal on the Internet. So does a methamphetamine lab that stored recipes, precursor acquisition records or distribution lists on a computer or thumb drive.
The transformation of American life made possible by the proliferation of computers, cell phones, and PDAs has had an important consequence: law enforcement agencies are now challenged by evidence appearing in new, technological forms. Forensic laboratories have long dealt with blood typing, fingerprint analysis, firearm identification, and, more recently, DNA matching. Now they must also deal with data recovery and analysis from business networks, home computers, cell phones, storage devices of all types, and even specialized game consoles because of the large hard drives they contain.
There is good news for law-abiding Nevadans. The drafters of NRS 205A were farsighted. They put in place a framework that could adapt to the forensic challenges posed by digital evidence. That framework has been fleshed out by cooperation among law enforcement agencies. Currently, the participants in the Nevada statutory task forces include: the FBI, Secret Service, Las Vegas Metropolitan Police, Immigration and Customs Enforcement, Attorney General’s Office, and Reno Police Department.
Unfortunately, there is also some news that is not so good for law-abiding Nevadans.
The statutory task forces do not receive state funding. One-time tobacco settlement funds enabled initial operation. However, the grant funding initially envisioned has failed to materialize, and shifts in federal priorities after 9-11 make it increasingly unlikely that grant funding will be available in the future.
Nevada presently has a single state employee devoted to the examination of suspect electronic devices. Support for state investigations and for local police and sheriff’s departments throughout the state is provided mainly by federal agency employees and by a few officers of the Las Vegas and Reno Police Departments.
This system will become increasingly stressed. Training first responders to recognize the importance of electronic devices will result in escalating demands for an ever-increasing amount of evidence to be analyzed in a timely fashion. Neither the federal agencies nor the largest city police departments will be able meet the growing demand throughout the state. Federal agencies have already signaled that their personnel will increasingly be dedicated to homeland security related investigations. While the FBI, USSS, and ICE will likely remain as accommodating as possible, the diminishing assets they can contribute to the investigation of state and local cases means that some type of future rationing is likely. Federal forensic examiners may become available only in serious crimes of violence and in financial crimes where the threshold amount of money involved escalates over time.
Nevada’s dramatic population growth, coupled with general taxpayer reluctance to expand municipal and county services, has placed severe strains on local police and sheriff’s departments. At a time when many local law enforcement agencies are having a hard time keeping the seats in their patrol cars warm, there are simply no personnel available locally to do electronic forensic analysis on a full time basis. Manpower and funding shortfalls take on added importance in light of the months of training required to transform even the most computer literate cop into a trained, certified examiner. Nor is training a one-time event. Examiners must periodically attend training sessions in an attempt to match the problems they confront due to the constantly evolving software, hardware, networks and techniques of the computer crime community.
Laws alone do not protect citizens. Law enforcement protects citizens. Article 1, section 2 of the Nevada Constitution provides: “Government is instituted for the protection, security and benefit of the people.”
Laws are not particularly costly to enact. Often, they are costly to enforce.
As a state, Nevada is not currently in crisis regarding the investigation and enforcement of technological crime. However, a crisis is clearly discernable in the future. We need to consider what is necessary in this increasingly digital age “for the protection, security and benefit of the people.” How much are we willing to pay for that protection, security and benefit? And what are the consequences if our willingness to pay falls short of what is needed to expand Nevada’s existing framework for technological crime? What will this mean for economic development and continued inward migration of technology-oriented companies? What additional risks and costs must be borne by citizen adults and children?
The Technological Crime Advisory Board is recommending to the next Legislature that Nevada increase the number of its computer forensic examiners and investigators by five over the course of fiscal years 2008 and 2009. Taking a cue from other states, the Advisory Board also recommends the enactment of a new forfeiture statute for technological crime. This would deny criminals the benefits of their activity and serve as a partial funding source for task force activities in years to come.
Presently, no consequences flow from categorizing a “standard” crime as a “technological” crime. Put another way, no additional consequences attach if someone charged with identity theft used a computer to assist in the process of obtaining thousands of dollars from multiple victims. As a result, a prosecutor has no incentive to charge a defendant with a technological crime in addition to the underlying misconduct.
An appropriately tailored forfeiture statute for technological crimes would add an important new tool to the state’s law enforcement toolbox. Nevada’s current general forfeiture provisions require that a second civil proceeding be undertaken after a criminal conviction is obtained. The standard of proof in that civil proceeding is “clear and convincing evidence,” a higher standard than the usual “preponderance of the evidence” in most civil cases. That civil proceeding would be almost always handled by a different attorney, often in a different division and office from the criminal prosecutor. Simply put, this is not a regime designed to deprive technologically-aware criminals the fruits of their criminal endeavors.
The Advisory Board’s proposal tracks Nevada’s own specialized racketeering forfeiture statute and the forfeiture statutes recently enacted by other states to deal with serious Internet fraud. After criminal conviction the trier of fact, whether a judge alone or a jury, would determine in an ancillary proceeding whether forfeitures were appropriate. This “criminal forfeiture” process is not only faster and simpler than the present two-tiered “civil forfeiture” process, it enables the same trier of fact, who moments before found the defendant guilty beyond a reasonable doubt, to draw on the same evidence to adjudge forfeitures. The Advisory Board proposal would funnel any forfeiture money to the further investigation of technological crimes and to the law enforcement agencies participating in the prosecution of a particular crime.
Law enforcement activities used to ensure the protection and security of society in the Internet age are appropriately funded from general revenues. However, there is also an important public interest served by denying criminals any financial benefit from their criminal activities.
The Technological Crime Advisory Board proposals are designed to add substance to the legal framework established in 1999 to deter technological crime in Nevada and, where deterrence fails, to use cooperation among federal, state, and local law enforcement agencies as the basis for timely, responsive criminal investigations in technological crime cases.