Module 12 - Computer Crimes

1. From the cases summarized above, explain what constitutes a computer crime.

When a computer and its application is used to facilitate commission of fraud, theft, and robbery, to counterfeit signatures, to circulate false information, to break codes and password, then such act is unethical and illegal. Thus, the use of computer that violates the law and causes damage or havoc is considered a computer crime.

2. Discuss at least three other examples of computer crimes.

IDENTITY THEFT
Identity theft, where a criminal assumes the identity of a victim and runs up large credit-card charges or cashes bad checks, is a growing problem. It can cost victim monetary losses, but in anguish, disruption of his or her life, and legal fees. The victim can cause lose a good credit standing, lose a job, or be sued by creditors to whom criminals owes money.

In one case, a man applied for numerous credit cards in the names of real people who had a good credit records; the people whose name were used did not know the accounts existed. The man lived well for two years, took several trips to Europe, and fraudulently charges more than $500,000 before being caught and sent to prison.

ATM FRAUD
A group of thieves, lacking insider access to real ATM system for the capture of account numbers, set up their own machine. They installed an ATM in a shopping mall in Connecticut. Initially, to gain customer confidence, the machine gave out cash. Later after reading each customer’s card and requesting the customer’s PIN, it displayed a message saying that the transaction could not be processed. After about two weeks, the machine was removed. It had served its purpose, which was to read the account numbers magnetically recorded on the cards and store the PIN typed by the customer. It was not connected to any banking system. The people who installed the machine created counterfeit cards and used them at real ATMs to steal approximately $107,000 from their victims. (They were caught and convicted)

SWINDLING AND SOBOTAGING EMPLOYERS AND COMPETITORS
Embezzlement is “fraudulent appropriation or property by a person to whom it has been entrusted.” With the use of computers, trusted employees have stolen hundreds of thousands, in some cases millions, of dollars from their employers. In a few spectacular cases, losses were in the hundreds of millions. (Volkswagen is believed to have lost more than $200 million in foreign-exchange fraud perpetrated by high-level employees.)

Source:
Baase, Sara. A Gift of Fire. Social, Legal, and Ethical Issues for Computers and the Internet. 2nd Edtion. Pearson Education, Inc. 2000. pages 311-314