[asterisk-biz] on the topic of fraud

[Trixter aka Bret McDanel]

On Sun, 2009-05-17 at 17:02 -0400, SIP wrote:
> If this guy had been defrauding AT&T and Verizon out of money by using 
> up their minutes and not paying bills, then fine.

I disagree with the "then fine" part.  Its a civil matter not a criminal
matter if that was all he was doing.  Failure to pay your bills should
not land you in jail (or the potential for that) in this country unless
you do it through fraud (which is what is alleged in this instance).
The allegations go beyond just using minutes and not paying bills.

They are alleged to have committed fraud (18 USC 1342 or so, mail, wire,
etc are all right next to each other and I forget which is which) by
forging documents which were used to grant the line of credit (ie
instead of prepay or some other mechanism).  The same types of things
apply if you lie on a credit card application, mortgage application (why
the Clintons had issues during the "white water" stuff, they checked the
box saying they would live there for the first year to get a lower
interest rate).  

Now there is the whole 10th amendment argument of whether or not the
federal government even has the right to do this ("regulate" as per
article I section 8 Clause 3 initially meant "to make regular" not to
tax, legislate, or anything else) but that is a totally separate
discussion :)


>  I'm assuming AT&T and 
> Verizon were smart enough to cut him off at some point. And now the FBI 
> is involved. Would it have honestly taken a lot of extra work to hire a 
> data forensics team to advise them before they actually went on the 
> raid? Would that extra two days of planning have meant a massive 
> difference in the back payments?
> 
The FBI has a team based out of Quantico, which is the group that wrote
the "take everything" policy.  This includes criminal and innocent
systems.  They need to be able to replicate the environment exactly for
trial, and until you figure out what is and what is not part of it its
safer from a prosecution perspective to take everything.

The fact that the agents in charge went on vacation just after and made
it really difficult for the innocent customers to get at least copies of
their data let alone their hardware back is a bit over the top, they
should have left someone in charge that could have dealt with that.

They usually do not respond well to claims that stuff needs to be
returned, and the problem is that if it never goes to trial they can
keep the systems forever.  Now generic fraud like 18 USC 1342 has a 5
year statute of limitations, so they can keep it for 5 years unless they
can get some additional crime tossed in there, such as financing by a
FDIC insured entity (perhaps some of the systems were leased with
similarly fradulent documents), which would mean its a crime against the
government and thus a 10 year statute of limitations.  After the statute
has expired they cant justify keeping the systems, but to keep systems
for 5 years basically makes them all but useless in the enterprise
anyway.

Software being developed, graphics for webpages, etc all qualify as a
"artist work in progress" which per first amendment rulings by SCOTUS
they have to return immediately upon being notified, yet they regularly
do not do this.

Note that they do not need to charge anyone, only have an investigation
into a crime that has a statute of limitations of X to seize and keep
the equipment for that duration.  At the end of the day, yes they can
make an affidavit to a judge to get a warrant even if the affidavit
contains inaccurate, incomplete, or incorrect information, seize
equipment and only return it after its no longer valuable.  

They can even rely on conflicting statements made by some informant, for
example the informant can be obviously just telling stories until they
get the one they like (it happens more than you think in the federal
system) and based on those statements they can get a warrant.  They have
"qualified immunity" in doing this, meaning that you have to show that
they knew they lied in the affidavit to sue them, and once the judge
signs the warrant they have "absolute immunity" which means that from
that point on you cant sue (unless you can pierce the "qualified
immunity" layer first).

Judges have ruled that as long as the FBI agents are doing what any
other FBI agent would think is reasonable they have immunity.  


So um yeah..  The flipside is that there are customers out there that
want phone service and currently do not have any, and it may entail some
consulting work to get  them back where they were before all of this.
So if anyone is wanting to get a few extra customers they should look at
this as an opportunity and try to contact those companies (which may be
hard given phone/email systems are now offline :)  and offer services to
them.



-- 
Trixter http://www.0xdecafbad.com     Bret McDanel
pgp key: http://pgp.mit.edu:11371/pks/lookup?op=get&search=0x8AE5C721