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"The ubiquity of online advertising is a product of its importance to the internet economy, said a group of consumer advocates Wednesday during a debate on the future of online advertising. But the impact of new targeted advertising methods on consumer privacy and its potential to manipulate online experiences was the subject of heated argument at the event, sponsored by the Information Technology and Innovation Foundation. Privacy does not mean the same thing to all consumers in all situations, said Progress and Freedom Foundation Senior Fellow Berin Szoka. Advertisements are attempts to capture user attention - the "great currency of the Internet" - and when successful support a wide range of valuable content, he said. But in online life, "consumers have many values," Szoka added. "Privacy is one of them," he said, but it is not an absolute. Consumers must sometimes trade privacy for content, he said. "There is no free lunch." As more information and entertainment migrates to the internet, Szoka said it is "critical…that we find a way to support this media." Targeted advertising can fit the bill, he suggested - especially if technology gives users more control over their own preferences. Most consumers don't understand that advertising is a necessity for today's internet, he said. New technologies like targeting need to be given a try, he said, so content providers can recoup the value of their advertising - down 25 percent since 2000, he noted. Center for Digital Democracy founder Jeff Chester said Szoka's ideas about advertising's future represented a "false dichotomy." The real debate should be over the rules that regulate advertiser content, he said. Chester warned of a "Targeting 2.0″ system in which neuroscience combined with massive databases not only serve ads, but target content to users. "It's about influencing our behavior without our consent," he said. Chester pointed to the subprime lending cr

China has denied allegations that it hacked into a Pentagon IT system and recovered plans for the Joint Strike Fighter (JSF). The combat aircraft which is to be procured by Britain as well, is being produced by Lockheed Martin. In allegations first reported in the Wall Street Journal, hackers stole "several terabytes of data related to design and electronics systems". The most sensitive data however on weapons systems and its stealth technology was not breached since it is kept on computers not connected to the internet. IT experts have said that they suspect the hackers came from China although it will be difficult to identify their exact origins. Hacking into IT systems as complex as the DoD's would require the help and capabilities of another government. Recovering data on the JSF would allow countries or rogue groups who could face the aircraft in future conflicts to develop counter measures based on the aircraft's weaknesses. The Chinese strongly denied that the breach originated from their country. "China has not changed its stance on hacking. China has always been against hacking and we have cracked down very hard on hacking. This is not a Chinese phenomenon. It happens everywhere in the world," a spokesperson for the Foreign Ministry said. This is not the first time the JSF's security has been breached. Early on in the contract the DoD and Lockheed Martin admitted that there was no universal IT security policy for the 1,200 sub contractors and that leaks may have occurred. BAE subsequently admitted that their IT security for JSF material was lax and that leaks could have occurred. Britain is scheduled to buy 150 of the aircraft by 2018.

A national security panic spread through the Internet yesterday after a report by The Wall Street Journal suggested "terabytes" of classified data on the F-35 Lightning II had been stolen by hackers. Today the Pentagon and Lockheed Martin responded to the allegations saying they are untrue, and I believe them. Defense Department spokesman Bryan Whitman said, "I'm not aware of any specific concerns." That's a key phrase. Lockheed Martin--the F-35 superjet's primary contractor--also commented "We actually believe The Wall Street Journal was incorrect in its representation of successful cyber attacks on the F-35 program." And the company's CFO Bruce Tanner added "I've not heard of that, and to our knowledge there's never been any classified information breach." While it's easy to argue that these responses are merely a smokescreen to save political face, the language is much more direct than a plain old "no comment." Typically, companies protect themselves in this sort of situation by denying the existing or potential hackers any public information on the success or failure of hack attempts, obscuring the level of secrecy of any stolen data. In the F-35 case it looks like the denials are much firmer, and that suggests the developers of the JSF are confident in their security systems. It's an echo of alleged data leaks via F-35 contractor BAE Systems last year, that were later withdrawn due to lack of evidence that leaks had occurred. Government and defense contractor computer networks face a pretty continuous rate of hack attempts. As a result such companies have even more stringent data security protocols in place than normal organizations. They're still not absolutely impervious to hacking, of course, as no such system ever is. So that's why the most highly classified data--critical to the super-secret offensive and defensive capabilities of hardware like the F-35--is typically stored on computers that have an extremely low-tech "air gap firewall". They're not co

In an indication of the legal troubles that companies can find themselves in over data breaches these days, several banks and credit unions have begun suing Heartland Payment Systems Inc. over its recently disclosed data breach. In the six weeks since the potentially massive breach was disclosed, eight banks and credit unions have filed lawsuits against Heartland over its alleged failure to take adequate measures for protecting credit and debt cardholder data. Heartland said on Jan. 20 that unknown intruders had broken into its network sometime last year and accessed payment card data belonging to an undisclosed number of customers. The breach, thought to possibly be the biggest ever disclosed, has already affected over 500 financial institutions, including a handful in the Bahamas, Bermuda and Canada. The lawsuits seek compensation from Heartland for the costs that the financial institutions said they've had to bear in notifying affected customers about the breach and in reissuing new payment cards. The lawsuits also claim damages from Heartland for costs of the alleged fraud that the banks claimed have resulted from the breach.

Two Philadelphia law firms have filed class action suits on behalf of all cardholders in the U.S. who had their credit or debit card data stolen in the Heartland Payment System (HPY) data breach. This brings to three the total number of class action lawsuits filed against the Princeton, NJ-based payments processor. The law firm of Berger & Montague filed a class action suit in the U.S. District Court for the District of New Jersey, alleging Heartland's failure to safeguard cardholder data when the company's computer systems were hacked and cardholder data was stolen. Heartland says last year it processed 100 million card transactions per month, but an unknown number of cards were impacted by the breach. The law firm says fraudulent activity has occurred on some of those cards. The law firm alleges that Heartland's security measures and intrusion detection systems were inadequate. "Because of Heartland's inadequate data security, cardholders have had their card information compromised, have been exposed to the risk of fraud, have spent and will spend time to monitor their accounts and dispute fraudulent charges, and have suffered other economic damages," the law firm says in its statement regarding the suit. Berger & Montague were also co-lead counsel in the consumer class action suit brought against TJX Companies, which resulted in a $200 million settlement. The third class action lawsuit filed in February against Heartland comes from Sheller P.C. of Philadelphia, PA. Sheller's suit against Heartland has similar charges against the payment processor. Sheller P.C. also filed its class action lawsuit in the U.S. District Court for the District of New Jersey. Sheller P.C. has also filed a consumer class action suit against RBS WorldPay for its security breach that was made public on Dec. 23, 2008. Previously, Chimicles & Tilellis LLP of Haverford, PA filed suit in the U.S. District Court for the District of New Jersey on behalf of Woodbury, MN resident Alicia Co

The Army says it's investigating allegations that eight male soldiers took pictures and video of as many as 21 female soldiers in their unit showering at Fort Dix. The photos were allegedly taken last fall, before the 266th Military Police Company of the Virginia Army National Guard shipped out to Iraq in December. Lt. Col. Christopher Garver said Friday the Army is conducting a criminal investigation and that no charges have been filed. Fort Dix spokeswoman Carolee Nisbet says the allegations are disappointing. She said most soldiers who train at the New Jersey installation before being deployed "live up to the Army values." The 266th is now serving in Basra. A spokesman for the Virginia Army National Guard did not immediately return a phone call seeking comment.

The FBI has used a secret form of spyware in a series of investigations designed to nab extortionists, database-deleting hackers, child molesters, and hitmen, according to documents obtained by CNET News. One suspect used Microsoft's Hotmail to send bomb and anthrax threats to an undercover government investigator; another demanded a payment of $10,000 a month to stop cutting cables; a third was an alleged European hitman who was soliciting for business from a Hushmail.com account. CNET News obtained the documents -- totaling hundreds of pages, although nearly all of them were heavily redacted -- this week through a Freedom of Information Act request to the FBI. The FBI spyware, called CIPAV, came to light in July 2007 through court documents that showed how the bureau used it to nab a teenager who was e-mailing bomb threats to a high school near Olympia, Wash. (CIPAV stands for Computer and Internet Protocol Address Verifier.) A June 2007 memo says that the FBI's Deployment Operations Personnel were instructed to "deploy a CIPAV to geophysically locate the subject issuing bomb threats to the Timberline High School, Lacy, Washington. The CIPAV will be deployed via a Uniform Resource Locator (URL) address posted to the subject's private chat room on MySpace.com."

Two U.S. Securities and Exchange Commission employees are under investigation by federal criminal authorities for allegedly using insider information to trade stocks, a source familiar with the matter said on Thursday. A report by the SEC's internal watchdog alleges that the two SEC lawyers traded in stock of a large financial services company despite being told by another SEC employee of ongoing investigations of that company, CBS News reported. The SEC inspector general report said one SEC attorney under investigation works in the Office of the SEC's Chief Counsel and has access to a tremendous amount of nonpublic information, CBS News said. An SEC spokesman said: "We take seriously even the suggestion that any SEC employee would engage in insider trading. We note that the inspector general report neither accuses any SEC employee of insider trading nor concludes that any such conduct took place." Calls to the SEC's inspector general and Federal Bureau of Investigation were not immediately returned.

"All Facebook users can deactivate their profiles, but doing so quietly might not make quite the same statement as using another service to slam the door on the site. One such service, Seppukoo.com, created by the Italian group Les Liens Invisibles, drew attention late last year after launching a campaign to convince people to commit Facebook suicide. Wannabe ex-Facebook members can provide Seppukoo.com with their names and passwords and Seppukoo then not only deactivates their profiles, but also creates a "memorial" page that it sends to users' former Facebook friends. Facebook evidently isn't happy about this development. Last month, the company fired off a cease-and-desist letter to Les Liens Invisibles, complaining that users who provide log-in data are violating Facebook's terms of service. The company also alleges that the scraping of its data violates a host of laws, including an anti-hacking law, the federal spam law and the copyright statute. "

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"* To pay all costs tied to administration of settlement * To pay class members' attorney costs Dec 21 (Reuters) - Credit card processor Heartland Payment Systems Inc (HPY.N) said it would settle consumer cardholder class actions tied to claims arising from breach of its system by cyber thieves, and pay up to $2.4 million to class members submitting valid claims. Heartland agreed to pay a minimum of $1 million to class members and take up settlement-related administration costs, including up to $1.5 million for the cost of notice to the settling class. The company will pay up to $760,000 of the costs of attorneys representing the class members. Heartland said it could terminate the deal if costs of notice exceeded $1.5 million, or if it received more than 2,500 requests for exclusion from the settlement class. The deal settles all intrusion-related proceedings by consumers who used the payment cards between Dec. 6, 2007 and Dec. 31, 2008, including those who may allege to have suffered losses, the company said in a statement. Heartland, which agreed to pay $3.6 million last week to settle claims with American Express Co (AXP.N) related to the criminal breach, reported in January this year that cyber thieves hacked its payment system and stole credit card information. Shares of the New Jersey-based company were down 18 cents at $13.29 Monday morning on the New York Stock Exchange. "

"In a bizarre case of cyber crime, the Wall Street Journal reported today that Russian hackers may have stolen tens of millions of dollars from Citigroup, a charge the bank denies. " Citing anonymous government officials, the newspaper reported that the hackers were connected to a Russian cyber gang and that two other computer systems, at least one connected to a U.S. government agency, were also attacked. The FBI is investigating the case, according to the Wall Street Journal, but the company has flatly denied the story. "We had no breach of the system and there were no losses, no customer losses, no bank losses," the banking giant said in a statement. "Any allegation that the FBI is working a case at Citigroup involving tens of millions of losses is just not true."

"Fomer UCLA Healthcare System researcher Huping Zhou has pleaded guilty to violating parts of the Health Insurance Portability and Accountability Act and could be one of the first people in the country convicted under the law, federal authorities announced Friday. After learning he was to be let go, the 48-year-old is alleged to have accessed the UCLA patient records system 323 times during the three-week period, mostly to check out the files of celebrities, according to the U.S. Attorney's Office. The names of the targeted stars have not been revealed. Federal authorities say Zhou admitted to accessing the records -- cruising files that were not necessary to view as part of his job -- under a plea agreement. He'll face a judge for sentencing March 22. It's not clear what kind of punishment the U.S. Attorney's Office will recommend in exchange for his cooperation."

"UC San Francisco said late Tuesday it has alerted 600 patients and others that an external hacker may have obtained "temporary access to emails containing their personal information" as a result of a late September phishing scam. The breach occurred about three months ago, and was investigated in mid-October, but wasn't disclosed to the public until Dec. 15. Corinna Kaarlela, UCSF's news director, told the San Francisco Business Times late Tuesday that individuals whose data may have been compromised were notified between Oct. 21, when an in-depth investigation began, and Dec. 11, when it was completed. UCSF said Tuesday that an unnamed faculty physician in the School of Medicine was victimized in late September by the alleged scam. The physician provided a user name and password in response to an email message fabricated by a hacker, that appeared as if it came from those responsible for upgrading security on UCSF internal computer servers. UCSF's Enterprise Information Security unit subsequently identified the breach and disabled the compromised password. UCSF says it conducted an investigation and in mid-October determined that emails in the physician's account ─ including some containing demographic and clinical information and, in a few cases, Social Security numbers ─ may have been exposed."

"Two Kansas men have been charged with making $1m in proceeds by buying computer networking gear in China and passing it off as products from Cisco Systems. Christopher Myers, 40, and Timothy Weatherly, 27, obtained the networking gear from a variety of sources and then slapped phony Cisco labels on them, according to documents filed in federal court in Kansas City. To give the goods the additional air of legitimacy, they put them in purported Cisco boxes and included counterfeit Cisco manuals. Myers also stands accused of obtaining access to a website containing Cisco's confidential serial numbers, so the men could affix them to the gear they sold. Prosecutors said the men sold the equipment on eBay and on private websites. They were charged with one count of conspiracy, 30 counts of trafficking in counterfeit goods and one count of trafficking in counterfeit labels. The government is seeking forfeiture of $1m in proceeds from the alleged crimes. If convicted, the men also face a maximum of fives years in prison and $250,000 in fines. Myers made an initial appearance in court on Thursday. Security experts have warned that counterfeit networking gear could contain back doors that allow spies to conduct industrial espionage on US companies."

"On October 6, 2009, the Federal Trade Commission ("FTC") announced proposed settlement agreements with six companies over charges that they falsely claimed membership in the U.S. Department of Commerce Safe Harbor program. In six separate complaints, the FTC alleged that ExpatEdge Partners LLC, Onyx Graphics, Inc., Directors Desk LLC, Collectify LLC, and Progressive Gaitways LLC deceived consumers by representing that they maintained current certifications to the Safe Harbor program when such certifications had previously lapsed. The terms of the proposed settlement agreements prohibit the companies from misrepresenting their membership in any privacy, security or other compliance program. The six enforcement actions are significant as they mark a considerable uptick in the FTC's enforcement related to the Safe Harbor program. The FTC recently brought its first enforcement action relevant to the program, which is detailed in our post titled FTC's First Safe Harbor Enforcement Action. The European Union Data Protection Directive requires EU Member States to implement legislation that prohibits the transfer of personal data outside the EU unless the EU has made a determination that the laws of the recipient jurisdiction are substantially equivalent to those of the EU, and thus provide "adequate" protection for personal data. Because the EU has determined that laws of the United States do not meet its adequacy standard, the U.S. Department of Commerce and the EU developed the Safe Harbor Framework, which went into effect in November 2000. The Safe Harbor Program allows participating U.S. companies under the jurisdiction of the FTC or the U.S. Department of Transportation to transfer personal data lawfully from the EU. To join the Safe Harbor, a company must self-certify to the U.S. Department of Commerce that it complies with seven principles that have been deemed to meet the EU's adequacy standard. To maintain its certification to the Safe Harbor

The Nature of the Problem Identity theft has been referred to by some as the crime of the new millennium. It can be accomplished anonymously, easily, with a variety of means, and the impact upon the victim can be devastating. Identity theft is simply the theft of identity information such as a name, date of birth, Social Security number (SSN), or a credit card number. The mundane activities of a typical consumer during the course of a regular day may provide tremendous opportunities for an identity thief: purchasing gasoline, meals, clothes, or tickets to an athletic event; renting a car, a video, or home-improvement tools; purchasing gifts or trading stock on-line; receiving mail; or taking out the garbage or recycling. Any activity in which identity information is shared or made available to others creates an opportunity for identity theft. It is estimated that identity theft has become the fastest-growing financial crime in America and perhaps the fastest-growing crime of any kind in our society. Identity Theft: Is There Another You?: Joint hearing before the House Subcomms. on Telecommunications, Trade and Consumer Protection, and on Finance and Hazardous Materials, of the Comm. on Commerce, 106th Cong. 16 (1999) (testimony of Rep. John B. Shadegg). The illegal use of identity information has increased exponentially in recent years. In fiscal year 1999 alone, the Social Security Administration (SSA) Office of Inspector General (OIG) Fraud Hotline received approximately 62,000 allegations involving SSN misuse. The widespread use of SSNs as identifiers has reduced their security and increased the likelihood that they will be the object of identity theft. The expansion and popularity of the Internet to effect commercial transactions has increased the opportunities to commit crimes involving identity theft. The expansion and popularity of the Internet to post official information for the benefit of citizens and customers has also increased opportunities to obtain

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Times West Virginian FAIRMONT - Two FBI police officers have been charged and one was arraigned Friday morning in Marion County magistrate court after videotaping high school girls who were trying on prom dresses at the Middletown Mall. According to an FBI press release, the two Clarksburg-based employees were charged with criminal invasion of privacy and conspiracy to commit video voyeurism by the Marion County prosecuting attorney's office. Gary Sutton Jr., 40, was charged with criminal invasion of privacy and being a party to a crime. And according to WDTV, a warrant has been issued for Charles Brian Hommema of Buckhannon. The charges stem from an event called the Cinderella Project that took place at the Middletown Mall in Fairmont that gave high school girls the opportunity to buy low-cost prom dresses. The event was sponsored by Hospice Care Corp. for the sixth year in a row and included $25,000 worth of dresses from Oliverio's Bridal Boutique in Clarksburg. The criminal complaint stated that the two men were on duty in the FBI's satellite control room, which coincidentally is located at Middletown Mall. The two allegedly stopped a security camera over a makeshift dressing room that had been set up to allow the girls to try on dresses during the event. The dressing rooms did not have ceilings, and the camera zoomed in and trained its focus on one particular dressing room for more than an hour. Several girls used that dressing room to try on prom dresses. The complaint stated that Sutton and Hommema were the only people in the control room and the only ones able to control the movements of the camera. The alleged activities were detected internally by the FBI and reported to the Department of Justice's Office of the Inspector General, prompting an investigation, according to the FBI release. "The FBI is committed to the timely and full resolution of this matter, but must remain sensitive to the privacy concerns of any potential victims

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A consumer reporting agency that failed to properly screen prospective customers and, as a result, sold at least 318 credit reports to identity thieves, has agreed to settle Federal Trade Commission charges that it violated federal law. Under the settlement, the company and its principal must ensure that they provide credit reports only to legitimate businesses for lawful purposes, use a comprehensive information security program, and obtain independent audits every other year for 20 years. The settlement also imposes a $500,000 penalty but suspends payment due to the defendants' inability to pay. According to the FTC, the defendants use sensitive financial data from other consumer reporting agencies to create reports that landlords use to assess potential renters. These reports contain consumers' names, Social Security numbers, birth dates, bank and credit card account numbers, credit histories, and other personal information. The Commission alleges that the company failed to properly screen new customers. The company allegedly requested only publicly-available information from applicants seeking credit reports, and it did not request supporting documentation to establish that an applicant was actually a landlord renting property. As a result, identity thieves posing as property owners were given an account with unlimited online access to credit reports, and the account was used to access at least 318 reports containing sensitive personal information. The FTC charged the defendants with violating the Fair Credit Reporting Act (FCRA) by furnishing credit reports to persons who did not have a permissible purpose to obtain them, and by failing to maintain reasonable procedures to prevent such impermissible disclosures and to verify their customers' identities and how they intended to use the information. The agency also charged them with violating the FTC Act by failing to employ reasonable and appropriate security measures to protect sensitive consumer inform

A couple in Pittsburgh whose lawsuit claimed that Street View on Google Maps is a reckless invasion of their privacy lost their case. Aaron and Christine Boring sued the Internet search giant last April, alleging that Google "significantly disregarded (their) privacy interests" when Street View cameras captured images of their house beyond signs marked "private road." The couple claimed in their five-count lawsuit that finding their home clearly visible on Google's Street View caused them "mental suffering" and diluted their home value. They sought more than $25,000 in damages and asked that the images of their home be taken off the site and destroyed. However, the U.S. District Court for Western Pennsylvania wasn't impressed by the suit and dismissed it (PDF) Tuesday, saying the Borings "failed to state a claim under any count." Ironically, the Borings subjected themselves to even more public exposure by filing the lawsuit, which included their home address. In addition, the Allegheny County's Office of Property Assessments included a photo of the home on its Web site. The Borings are not alone in their ire toward the Google Maps feature. As reported earlier, residents in California's Humboldt County complained that the drivers who are hired to collect the images are disregarding private property signs and driving up private roads. In January, a private Minnesota community near St. Paul, unhappy that images of its streets and homes appeared on the site, demanded Google remove the images, which the company did. However, Google claims to be legally allowed to photograph on private roads, arguing that privacy no longer exists in this age of satellite and aerial imagery. "Today's satellite-image technology means that...complete privacy does not exist," Google said in its response to the Borings' complaint Not long after the feature launched in May 2007, privacy advocates criticized Google for displaying photographs that included people's faces and car license

Big Brother may be at it again. Behavioral advertising - the tracking of consumer's Internet surfing activity to create tailored ads - has triggered an intense legal controversy that has law firms scrambling to stay on top of a burgeoning practice. Attorneys say that behavioral advertising is raising privacy, litigation and regulation fears among consumer advocates, the electronic commerce and advertising industries and legislators. Law firms are busy helping companies come up with a transparent way of letting consumers know that their online activities are being tracked and possibly shared. "Lawmakers and companies are having a tough time keeping up with this new frontier of Internet privacy issues, and there is growing consumer unrest about behavioral advertising, leading in some cases to consumer rebellion," said Lisa Sotto, a partner and head of the privacy and security data group in the New York office of Richmond, Va.-based Hunton & Williams. "Consumers find this type of tracking intrusive, and businesses are starting to take the consumer reaction seriously," she said. The buzz over behavioral advertising has been building since congressional hearings that were held last year, during which Congress called on Internet service providers (ISPs) to testify about a highly controversial advertising practice known as "deep-packet inspection." The practice gives companies the ability to track every Web site consumers visit and provides a detailed look at everything they're doing, such as where they're going on vacation, who is going, how much they spent on the trip and what credit card was used. But then came the first class action targeting behavioral advertising, filed against Foster City, Calif.-based NebuAd Inc., an online advertising company accused of spying on consumers from several states and allegedly violating their privacy and computer security rights. The lawsuit specifically alleges that NebuAd engaged in deep-packet inspection. Valentine v. Ne