1. Chapter 10
Public Policy: From Legal
Issues to Policy
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2. Legal and Ethical Issues
Privacy
Intellectual Property
Difficult to protect since it is easy and
inexpensive to copy and disseminate digitized
information
Free Speech
Internet provides the largest opportunity for free
speech; but, some postings are offensive to
people
Taxation
Illegal to impose new sales taxes on Internet
business at the present time (U.S. and2 some

3. Legal and Ethical Issues (cont.)
Computer crimes
Usually refers to computer fraud and
computer abuse
Consumer Protection
Many legal issues are related to electronic
trade
Other legal issues
Validity of contracts, legality of public key
encryption infrastructures, jurisdiction over
trades, encryption policies
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4. Ethical Issues
What is considered to be right and wrong?
What is unethical is not necessarily illegal.
Whether these actions are considered
unethical depends on the organization,
country, and the specific circumstances
surrounding the scenarios.
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5. Ethical Issues (cont.)
Code of Ethics
A collection of principles intended as a
guide for its members
Many companies and professional
organizations develop their own codes
of ethics
A guide for members of a company or
an association
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6. A Framework for Ethical Issues
Privacy—regarding information about
individuals
Collection
Storage
Dissemination
Property
Ownership and value of information and
intellectual property
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7. A Framework for Ethical Issues (cont.)
Accuracy of:
Authenticity
Fidelity
Information collected and processed
Accessibility
Right to access information
Payment of fees for the access
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8. Protecting Privacy
Privacy
The right to be left alone and the right to be free
of unreasonable personal intrusions
Information Privacy
The “claim of individuals, groups, or institutions to
determine for themselves when, and to what
extent, information about them is communicated
to others”
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9. Protecting Privacy (cont.)
Two basic rules
The right of privacy is not absolute. Privacy
must be balanced against the needs of
society
The public's right to know is superior to the
individual’s right of privacy
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10. How is Private Information Collected?
Reading your newsgroups’ postings
Finding you in the Internet Directory
Making your browser record information
about you
Recording what your browsers say about you
Reading your e-mail
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11. Protecting Your Privacy
Think before you give
out personal information
on a site
Track the use of your
name and information
Keep your newsgroups’
posts out of archives
Use the Anonymizer
when browsing
Live without cookies
Use anonymous
remailers
Use encryption
Reroute your mail
away from your
office
Ask your ISP or
employer about a
privacy policy
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12. Legislation
The Consumer Internet Privacy Act
The Federal Internet Privacy Protection Act
The Communications Privacy and Consumer
Empowerment Act
The Data Privacy Act
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13. Personal Information in Databases
Databases of:
Banks and financial institutions
Cable TV
Telephones
Employers
Schools
Insurance companies
Online vendors
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14. Personal Information
in Databases (cont.)
Concerns
Data collection
Data accuracy
Data confidentiality
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15. Protecting Intellectual Property
Copyright
A statutory grant that provides the creators of
intellectual property with ownership of it for 28
years
Trade Secret
Intellectual work such as a business plan, which
is a company secret and is not based on public
information
Patent
A document that grants the holder exclusive
rights on an invention for 17 years (U.S.)
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16. Copyrights
Protects original expression of ideas
Literary works
Musical works
Dramatic works
Artistic works
Sound recordings, films, broadcasts, cable
programs
Published editions of literary and musical
works
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17. Copyright Protection Techniques
Digital watermarks
Embedding of invisible marks
Can be represented by bits in digital
content
Hidden in the source data, becoming
inseparable from such data
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18. International Aspects of
Intellectual Property
The World Intellectual Property Organization
More than 60 member countries come up with an
international treaty
Part of the agreement is called the “database
treaty”
Its aim is to protect the investment of firms that
collect and arrange information
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19. Patents
Patent—a document that grants the holder
exclusive rights on an invention for 17 years
Satisfy following legal criteria
Novel—does not already exist as part of the
public domain
Involves sufficiently “inventive step”
Capable of individual application (be put to
practical use)
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20. Trademarks
Trademarks—graphical sign used by
businesses to identify their goods and
services
Gives exclusive rights to:
Use trademark on goods and services
registered to that sign
Take legal action to prevent anyone from
using trademark without consent
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21. Domain Names
Domain name refers to the upper category
of Internet address (URL)
Three controversies
Whether top-level domain names (similar to
com, org and gov) should be added
The use of trademark names by companies for
domain names that belong to other companies
If companies in different countries have the
same name, who can use it as the domain
name?
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22. Defining Freedom of Speech
The Bill of Rights First Amendment to the
Constitution of the U.S. of America reads:
“Congress shall make no law respecting an
establishment of religion, or prohibiting the free
exercise thereof; or abridging the freedom of
speech, or of the press; or the right of the people
peaceably to assemble, and to petition the
government for a redress of grievances.”
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23. The Debate About
Free Speech on the Internet
Free speech debate
“Most citizens are implacably opposed to
censorship in any form — except censorship of
whatever they personally happen to find
offensive.”
The debate: what restrictions, if any, should there
be on Internet content, and how should it be
monitored?
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24. The Debate About
Free Speech on the Internet (cont.)
What are the boundaries, and how should they be
enforced?
Governments protective of their role in society
Parents concerned about exposing their children to
inappropriate Web pages and chat rooms
Federal agencies attempting to deal with illegal actions
Citizen action groups desiring to protect every ounce of
their freedom to speak
Individuals concerned about their right to information on
the Internet
Organizations seeking to empower the citizens of the earth
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25. Protecting Children
3 approaches (regarding the protection of children
from inappropriate material on the Internet)
No information should be held back and parents
should be responsible for monitoring their own
children
The government is the only one who can truly
protect children from this material
To hold the Internet providers responsible for all
the material and information they provide, or
enable access to it
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26. Protecting Children (cont.)
Parents governing their own children
Government protecting the children
Responsibility of the Internet providers
Forcing Internet providers to be accountable,
or enable access to information
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27. Legal Perspectives in the USA
Child Online Protection Act
Internet Tax Freedom Act
Family Friendly Internet Access Act
Internet Protection Act
Internet School Filtering Act
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28. Controlling Spamming
What is spamming, why is it bad?
Spamming
“The practice of indiscriminate distribution of
messages (for example junk mail) without
permission of the receiver and without
consideration for the messages’
appropriateness”
Spam comprised 30% of all mail sent on America
Online (in the past, now less than 10%)
Slows the internet in general
Shuts ISPs down completely
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29. Controlling Spamming (cont.)
Legislation, Legal
The Electronic Mailbox Protection Act
The Unsolicited Commercial Electronic Mail
Act
The Netizens Protection Act
The Telephone Consumer Protection Act
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30. Controlling Spamming (cont.)
How to cut spamming
Tell users not to validate their addresses by
answering spam requests for replies if they
want to be taken off mailing lists
Disable the relay feature on SMTP (mail)
servers so mail cannot be bounced off the
server
Delete spam and forget it— it’s a fact of life
and not worth wasting time over
Use software packages, e.g. getlost.com and
junkbusters.com
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31. Other Legal Issues
What are the rules of electronic contracting, and
whose jurisdiction prevails when buyers, brokers,
and sellers are in different states and/or
countries?
How can gambling be controlled on the Internet?
Gambling is legal in Nevada and other states.
How can the winner’s tax be collected? By
whom?
When are electronic documents admissible
evidence in the courts of law? What do you do if
they are not?
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32. Other Legal Issues (cont.)
Time and place can carry different dates for the buyers
and sellers when they are across the ocean. Which
time should be considered?
Is a digital signature legal?
The use of multiple networks and trading partners
makes the documentation of responsibility difficult.
How is such a problem overcome?
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33. Electronic Contracts
Uniform Electronic Transactions Act
Uniform Commercial Code (UCC)
Shrink-wrap agreements (or box-top
licenses)
The user is bound to the license by opening the
package
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34. Computer Crimes
Computer crimes refers to computer fraud
and/or computer abuse
Computer fraud committed by:
Alteration of input
Alteration of computer data
Alteration/misuse of programs
Destruction/suppression/misappropriation of
output
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35. Computer Crimes (cont.)
Computer abuse committed by:
Misuse of company computer
service/resources by performing unauthorized
private work or playing games by employees
Compromise of system integrity by:
Altering company data
Introducing viruses
Hacking into the system
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36. Computer Crimes (cont.)
Characteristics of computer crime
Chronic underreporting of abuse
Security not introduced until abuse has occurred
Organizational size unrelated to severity of
punishment
Abuses by high-level employees less likely to be
prosecuted
Programmers most difficult to identify
Publicity discourages abuse
Security efforts reduce abuse
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37. Computer Crimes (cont.)
Effective measures in deterring computer
crime
Make computer security visible
Define and communicate company’s policy
regularly
Make staff aware of penalties
Report cases to police
Publicize successful prosecution
Deploy security technologies extensively
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38. Fraud on the Internet
Internet Stocks Fraud
SEC brought charges against 44 companies and
individuals who illegally promoted stocks on
computer bulletin boards, online newsletters and
investment Web sites
Other Financial Fraud
Selling bogus investments, phantom business
opportunities, and other fraud schemes
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39. Fraud on the Internet (cont.)
Other Fraud in EC
Customers may:
Receive poor quality products and
services
Not get products in time
Be asked to pay for things they assume
will be paid for by sellers
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40. Authentication
If authentication online can be verified
Students will be able to take exams online from
home
Fraud of recipients of government entitlements
and other payments will be reduced to a bare
minimum
Buyers will be assured who the sellers are and
sellers will know who the buyers are with a very
high degree of confidence
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41. Biometric Controls
Matching against a template:
Photo of face
Fingerprints
Hand geometry
Blood vessel pattern in the retina of a person’s
eye
Voice
Signature
Keystroke dynamics
y.
Iris
ath
C
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42. What Can Vendors Do?
Use intelligent software that signals
questionable customers
Develop a list of warning signals for possibly
fraudulent transactions
Ask customers to have shipping address
added to their bank account if different from
billing address
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43. Managerial Issues
Multinational corporations face different
cultures in the different countries in which they
are doing business
Issues of privacy, ethics, and so on may seem
to be tangential to running a business, but
ignoring them may hinder the operation of
many organizations
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44. Managerial Issues (cont.)
The impact of EC and the Internet can be
so strong that the entire manner in which
companies do business will be changed,
with significant impacts on:
Procedures
People
Organizational structure
Management
Business processes
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