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AT&T's controversial $39 billion bid for T-Mobile officially got under way Thursday, crystallizing a big risk and possibly a big opportunity for President Barack Obama.The risk: allowing a deal that could, in time, leave Americans with just two choices for cellphone providers. The potential opportunity: extending high-speed wireless to virtually the entire country, which AT&T has promised if the deal goes through.

The political implications don't end there: Blocking the acquisition would mean alienating a stalwart member of the business community. Approving it, critics warn, could lead to steep layoffs as the two phone companies merge overlapping operations.

Montreal (AFP) - A Canadian charged for refusing to give border agents his smartphone passcode was expected Thursday to become the first to test whether border inspections can include information stored on devices.Alain Philippon, 38, risks up to a year in prison and a fine of up to Can$25,000 (US$20,000) if convicted of obstruction.He told local media that he refused to provide the passcode because he considered information on his smartphone to be "personal."Philippon was transiting through the port city of Halifax on his way home from a Caribbean vacation on Monday when he was selected for an in-depth exam.

"Philippon refused to divulge the passcode for his cell phone, preventing border services officers from their duties," Canada Border Services Agency said in an email.The agency insists that the Customs Act authorizes its officers to examine "all goods and conveyances including electronic devices, such as cell phones and laptops."But, according to legal experts, the issue of whether a traveler must reveal the password for an electronic device at a border crossing has not been tested in court. "(It's) one thing for them to inspect it, another thing for them to compel you to help them," Rob Currie, director of the Law and Technology Institute at Dalhousie University, told public broadcaster CBC.Philippon is scheduled to appear in court on May 12.

AMERICAN AND BRITISH spies hacked into the internal computer network of the largest manufacturer of SIM cards in the world, stealing encryption keys used to protect the privacy of cellphone communications across the globe, according to top-secret documents provided to The Intercept by National Security Agency whistleblower Edward Snowden. The hack was perpetrated by a joint unit consisting of operatives from the NSA and its British counterpart Government Communications Headquarters, or GCHQ. The breach, detailed in a secret 2010 GCHQ document, gave the surveillance agencies the potential to secretly monitor a large portion of the world’s cellular communications, including both voice and data. The company targeted by the intelligence agencies, Gemalto, is a multinational firm incorporated in the Netherlands that makes the chips used in mobile phones and next-generation credit cards. Among its clients are AT&T, T-Mobile, Verizon, Sprint and some 450 wireless network providers around the world. The company operates in 85 countries and has more than 40 manufacturing facilities. One of its three global headquarters is in Austin, Texas and it has a large factory in Pennsylvania. In all, Gemalto produces some 2 billion SIM cards a year. Its motto is “Security to be Free.”

With these stolen encryption keys, intelligence agencies can monitor mobile communications without seeking or receiving approval from telecom companies and foreign governments. Possessing the keys also sidesteps the need to get a warrant or a wiretap, while leaving no trace on the wireless provider’s network that the communications were intercepted. Bulk key theft additionally enables the intelligence agencies to unlock any previously encrypted communications they had already intercepted, but did not yet have the ability to decrypt.

Leading privacy advocates and security experts say that the theft of encryption keys from major wireless network providers is tantamount to a thief obtaining the master ring of a building superintendent who holds the keys to every apartment. “Once you have the keys, decrypting traffic is trivial,” says Christopher Soghoian, the principal technologist for the American Civil Liberties Union. “The news of this key theft will send a shock wave through the security community.”

The first (and thus far only) roll-back of post-9/11 surveillance authorities was implemented over the weekend: The National Security Agency shuttered its program for collecting and holding the metadata of Americans’ phone calls under Section 215 of the Patriot Act. While bulk collection under Section 215 has ended, the government can obtain access to this information under the procedures specified in the USA Freedom Act. Indeed, some experts have argued that the Agency likely has access to more metadata because its earlier dragnet didn’t cover cell phones or Internet calling. In addition, the metadata of calls made by an individual in the United States to someone overseas and vice versa can still be collected in bulk — this takes place abroad under Executive Order 12333. No doubt the NSA wishes that this was the end of the surveillance reform story and the Paris attacks initially gave them an opening. John Brennan, the Director of the CIA, implied that the attacks were somehow related to “hand wringing” about spying and Sen. Tom Cotton (R-Ark.) introduced a bill to delay the shut down of the 215 program. Opponents of encryption were quick to say: “I told you so.”

But the facts that have emerged thus far tell a different story. It appears that much of the planning took place IRL (that’s “in real life” for those of you who don’t have teenagers). The attackers, several of whom were on law enforcement’s radar, communicated openly over the Internet. If France ever has a 9/11 Commission-type inquiry, it could well conclude that the Paris attacks were a failure of the intelligence agencies rather than a failure of intelligence authorities. Despite the passage of the USA Freedom Act, US surveillance authorities have remained largely intact. Section 702 of the FISA Amendments Act — which is the basis of programs like PRISM and the NSA’s Upstream collection of information from Internet cables — sunsets in the summer of 2017. While it’s difficult to predict the political environment that far out, meaningful reform of Section 702 faces significant obstacles. Unlike the Section 215 program, which was clearly aimed at Americans, Section 702 is supposedly targeted at foreigners and only picks up information about Americans “incidentally.” The NSA has refused to provide an estimate of how many Americans’ information it collects under Section 702, despite repeated requests from lawmakers and most recently a large cohort of advocates. The Section 215 program was held illegal by two federal courts (here and here), but civil attempts to challenge Section 702 have run into standing barriers. Finally, while two review panels concluded that the Section 215 program provided little counterterrorism benefit (here and here), they found that the Section 702 program had been useful.

There is, nonetheless, some pressure to narrow the reach of Section 702. The recent decision by the European Court of Justice in the safe harbor case suggests that data flows between Europe and the US may be restricted unless the PRISM program is modified to protect the information of Europeans (see here, here, and here for discussion of the decision and reform options). Pressure from Internet companies whose business is suffering — estimates run to the tune of $35 to 180 billion — as a result of disclosures about NSA spying may also nudge lawmakers towards reform. One of the courts currently considering criminal cases which rely on evidence derived from Section 702 surveillance may hold the program unconstitutional either on the basis of the Fourth Amendment or Article III for the reasons set out in this Brennan Center report. A federal district court in Colorado recently rejected such a challenge, although as explained in Steve’s post, the decision did not seriously explore the issues. Further litigation in the European courts too could have an impact on the debate.

Under the Fourth Amendment, Americans are protected from unreasonable searches and seizures, but according to one group of federal prosecutors, just being in the wrong house at the wrong time is cause enough to make every single person inside provide their fingerprints and unlock their phones.Back in 2014, a Virginia Circuit Court ruled that while suspects cannot be forced to provide phone passcodes, biometric data like fingerprints doesn’t have the same constitutional protection. Since then, multiple law enforcement agencies have tried to force individual suspects to unlock their phones with their fingers, but none have claimed the sweeping authority found in a Justice Department memorandum recently uncovered by Forbes.

In the court document filed earlier this year, federal prosecutors in California argued that a warrant for a mass finger-unlocking was constitutionally sound even though “the government does not know ahead of time the identity of every digital device or every fingerprint (or indeed, every other piece of evidence) that it will find in the search” because “it has demonstrated probable cause that evidence may exist at the search location.” Criminal defense lawyer Marina Medvin, however, disagreed. Advertisement Advertisement “They want the ability to get a warrant on the assumption that they will learn more after they have a warrant,” Medvin told Forbes. “This would be an unbelievably audacious abuse of power if it were permitted.”Unfortunately, other documents related to the case were not publicly available, so its unclear if the search was actually executed. Even so, Medvin believes the memorandum sets a deeply troubling precedent, using older case law regarding the collection of fingerprint evidence to request complete access to the “amazing amount of information” found on a cellphone.

The digital privacy world was rocked late Thursday evening when The New York Times reported on Securus, a prison telecom company that has a service enabling law enforcement officers to locate most American cell phones within seconds. The company does this via a basic Web interface leveraging a location API—creating a way to effectively access a massive real-time database of cell-site records. Securus’ location ability relies on other data brokers and location aggregators that obtain that information directly from mobile providers, usually for the purposes of providing some commercial service like an opt-in product discount triggered by being near a certain location. ("You’re near a Carl’s Jr.! Stop in now for a free order of fries with purchase!") The Texas-based Securus reportedly gets its data from 3CInteractive, which in turn buys data from LocationSmart. Ars reached 3CInteractive's general counsel, Scott Elk, who referred us to a spokesperson. The spokesperson did not immediately respond to our query. But currently, anyone can get a sense of the power of a location API by trying out a demo from LocationSmart itself. Currently, the Supreme Court is set to rule on the case of Carpenter v. United States, which asks whether police can obtain more than 120 days' worth of cell-site location information of a criminal suspect without a warrant. In that case, as is common in many investigations, law enforcement presented a cell provider with a court order to obtain such historical data. But the ability to obtain real-time location data that Securus reportedly offers skips that entire process, and it's potentially far more invasive. Securus’ location service as used by law enforcement is also currently being scrutinized. The service is at the heart of an ongoing federal prosecution of a former Missouri sheriff’s deputy who allegedly used it at least 11 times against a judge and other law enforcement officers. On Friday, Sen. Ron Wyden (D-Ore.) publicly released his formal letters to AT&T and also to the Federal Communications Commission demanding detailed answers regarding these Securus revelations.

That didn't take long. Securus -- you know, that company that lets cops track phones in real time with what amounts to a "pinky promise," according to US Sen. Ron Wyden -- has reportedly been hacked.The hacker, according to Motherboard, was able to get away with, at a minimum, a spreadsheet containing 2,800 logins and poorly encrypted passwords, some of which had already been cracked. Motherboard says it tested a number of logins to corroborate the hacker's story.Securus on Friday confirmed in a statement that "a subset of certain non-consumer administrative user account information (e.g., usernames, email addresses, and phone numbers) had been unlawfully accessed" and said it's launched an investigation into the breach. It's found no evidence that the breach is related to its location-based services, but it's disabled location-based data in the meantime "in an abundance of caution."Last Thursday, The New York Times revealed that Securus Technologies, which monitors calls to US prison inmates, has been used by a former Missouri sheriff to monitor people's phones and track their location. Wyden has called on federal authorities to investigate the company and its practices as they relate to people's privacy.