-Caveat Lector-

08/07/2001

FBI wants PC surveillance method kept quiet

www.usatoday.com/life/cyber/tech/2001-08-07-fbi-surveillance-trial.htm

NEWARK, N.J. (AP) - The Justice Department claims that revealing details
about how it bugged the computer of an accused bookie could threaten
national security.

Disclosing material about the "key logger system" the FBI installed on the
computer of Nicodemo S. Scarfo Jr. would hurt ongoing investigations of
foreign intelligence agents and endanger the lives of U.S. agents, according
to court documents filed by the government.

The Justice Department claims the system must remain secret to keep hostile
intelligence officers from employing "counter-surveillance tactics to thwart
law enforcement."

The case is being watched by privacy experts concerned over the government
use of spy technology.

Lawyers for Scarfo, the son of a jailed mob boss, say they need the
information to determine if the intrusion violated his constitutional
rights. If it did, none of the evidence from the computer could be used at
his trial.

U.S. District Judge Nicholas H. Politan has not said when he would rule on
the motion. At a hearing last week, the judge said the matter should not
delay the Sept. 11 trial date for Scarfo, 36, and Frank Paolercio, 32, who
are accused of loansharking and running a gambling racket.

Scarfo's father, Nicodemo "Little Nicky" Scarfo, is serving a life term for
running the Philadelphia-Atlantic City mob in the 1980s.

Politan has barred attorneys in the case from talking to reporters.

In an affidavit filed Friday, Donald Kerr, the assistant director of the FBI
lab, said that "there are only a limited number of effective techniques
available to the FBI to cope with encrypted data, one of which is the 'key
logger system."' If criminals learn how the logger works, they can
circumvent it, he said.

Scarfo used software called PGP - Pretty Good Privacy - to encode gambling
records, authorities maintain. PGP is a strong, free encryption program that
can be used for e-mail or individual files.

FBI agents installed the key logger system on Scarfo's computer after
getting a search warrant allowing them to break into his Essex County
business and look for a password that would unlock files they believed
contained records of the illegal enterprise.

The system, which recorded every keystroke, eventually captured the password
they needed. A three-count indictment was returned in June 2000 against
Scarfo and Paolercio.

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