Welcome to AWR-168-W

Cyber Law and White Collar Crime

About the course

The Cyber Law and White Collar Crime Course covers legal issues of Internet regulations, online
contracting, employee privacy, intellectual property cybercrimes such as copyright infringements, cyber
fraud, trademarks and domain name registration. This course will also cover Internet fraud issues
including identity theft, electronic evidence, electronic discovery for court proceedings, search and
seizure restrictions, free speech, online gambling, anti-hacking and anti-spyware laws as they pertain to
the Internet.

This course consists of 6 modules or lessons. Before each module, you will take a pre-test. This is to
gauge your level of knowledge before going through the content.

At the end of each module, you will take a post-test. You must correctly answer 80% of the questions
before advancing to the next module. If you do not correctly answer a minimum of 80% of the
questions, you will be required to repeat the module content and re-test successfully before moving to
the next module.

You will use the two bottom right buttons to navigate through the course. To move to the next screen,
click the next button in the bottom right hand corner of this screen. To move to the previous screen,
click the back button in the bottom right hand corner of this screen.

Audio will be indicated with a speaker graphic in the top right hand corner of the screen and will play
automatically. To replay the audio, click on the speaker graphic.

Vocabulary words are shown in green. When you click on these words, the definition will appear in a
separate window.

In the top right hand corner of the screen are four tabs to assist you during the course. You can use
these tabs to access resources, the glossary, course help or to quickly exit the course.

The following topics will be covered in this course:

 Module 1 - Key Terms and Concepts Cyber Law

 Module 2 - Intellectual Property Cyber Crimes
 Module 3 - Trademark and Domain Name Theft
 Module 4 - Internet Fraud
 Module 5 - Electronic Evidence and E-Discovery
 Module 6 - Additional Cyber Crimes

About Module 1 - Key Terms and Concepts Cyber Law

At the completion of this module, you will be able to:

• Explain how the Internet is designed to function as a Global Network.

• Explain how the Internet is regulated.

• Explain the guide for online contracting.

• Describe online employee privacy rights.

• Describe the positive and negative effects of the use of the Internet in the workplace.

• Explain the benefits of an employee Internet policy.

• Explain the function of the FTC as the regulator of Internet marketing.

• Describe The FTC Act and Online Advertising.

• Describe Internet practices of unfair or deceptive acts.

• Describe the disclosure requirements as stated by the FTC Act.

n this course, we will discuss the laws pertaining to the Internet, e-Commerce, and data moving over the
Internet. The overarching term for these laws is Cyber Law. \

Two things are important to remember as you go through this course:

• How laws are created and applied.

• Legislatures create laws.

• Regulatory agencies read the passed laws, create specific regulations based on the laws, and
enforce these new regulations.

• Courts rule on cases brought before them based on the laws and/or regulations, possibly
modifying or even overruling the laws and/or regulations.

• The dynamic nature of the laws.

• Technology moves considerably faster than legislatures and regulatory agencies. This means laws
and regulations are always behind. Laws are constantly playing catch up to what is on the Internet or in
the computer world.

Click the button below to learn more.

Before we begin our discussion on cyber laws, it is important to understand the concept of jurisdiction.

Jurisdiction refers to the boundaries and limits of authority a court or legal system may have and plays a
major role in how and where cases are handled. Generally jurisdiction is thought to be geographical or
political but it can also be related to appellate jurisdiction, subject matter jurisdiction, personal
jurisdiction, diversity, concurrent and exclusive jurisdictions.

Historically, decisions regarding jurisdiction were based solely on the location of the victim. If the victim
was in Texas, either Texas or the U.S. would have jurisdiction over the crime. What happens if the cyber
criminal is in India, or Russia, or Nigeria? Who would have jurisdiction over the crime and the criminal?

There isn’t a good answer to this, so individual courts in individual countries have had to make their own
argument for jurisdiction and attempt to have their decisions honored by the other countries. The
international nature of the internet, corporations and businesses means that figuring out whose
jurisdiction a cyber crime falls under is not a trivial matter ("Personal Jurisdiction in Cyberspace").

The Internet is a global system of interconnected computer networks that use the standard Internet
protocol suite to enable computers of all kinds to directly and transparently communicate and share
services throughout much of the world. It is a network of networks that form a shared global repository
of information, and a means of collaboration and cooperation among countless diverse communities.
This has made it an invaluable resource for a vast number of people and organizations, enabling them to
achieve their goals in faster, more economical ways.

Due to the unique nature of the Internet, any policy for regulation should take into account the ways in
which the Internet differs from TV and other mass media. The Internet involves many factors such as:

• Global environment.

• Open accessibility.

• Decentralized nature (there is no "home-base").

• User-controlled.

Whether or not the Internet can be successfully regulated depends on a number of factors and an
evaluation of certain considerations such as:

• Intellectual property

• Tax issues

• Cybercrime

• Freedom of access

Additionally, technical specifications must be considered along with licensing issues. Add to this the
global nature of the Internet and possible jurisdictional problems in the U.S. (whether local, state, or
Federal jurisdiction) and abroad (whether or not the country in which the server is located will be even
remotely responsive to our inquiries or demands). Jurisdictional problems can vastly complicate
enforcement, making regulation extremely difficult. When the ability to offend is borderless, protecting
our citizens from perpetrators in other parts of the world proves challenging.

The Internet is often described through the following phrase:

“The Internet has made the world flat.”

This mean there are no longer obstacles to prevent individuals from communicating and collaborating
on a global level. This has greatly opened up global commerce. Global commerce is no longer limited to
big international corporations. Any size business can participate in global commerce.
There are many advantages and disadvantages to this equality of entrance into global commerce. A
major disadvantage is criminal activity, ranging from false representation to the selling of illegal items.

Unfortunately, global commerce has always had these problems. In 1919, The International Chamber of
Commerce (ICC) was formed with the purpose of creating a world system of rules to govern trade,
investment, finance, or commercial relations to handle these very problems.

The ICC has engaged in the following activities:

• Sets broad-based rules and standards, including arbitration and dispute resolution procedures,
and a number of mechanisms that collectively promote open trade, self-regulation, and fight corruption
and commercial crime.

• Digitalized most of their procedures including the ICC Tools for E-business, which is a compilation
of principles, best practices, and recommendations concerning business self-regulation of electronic
commerce.

• Created the General Usage for International Digitally Ensured Commerce (GUIDEC 2001).

• Deals with the emerging global electronic trading system, and provides a set of common
definitions and business-generated best practices for certifying and ensuring electronic transactions and
commerce.

• Published a set of generic guidelines for conducting trade transactions electronically.

• Supports world organizations such as the World Trade Organization (WTO) in the field of e-
commerce.

The ICC has also engaged in the following activities:

• Published a strategy for promoting the development of the necessary infrastructure for
conducting e- commerce and for developing trade in goods and services via e-commerce.
• The Uniform Electronic Transactions Act (UETA), adopted into law in 47 states,
District of Columbia, Puerto Rico and the Virgin Islands, has a purpose to:
• "establish the legal equivalence of electronic records and signatures with paper
writings and manually-signed signatures, removing barriers to electronic
commerce" (Uniform Law Commissioners).
• Proposed various recommendations for the development of e-commerce, such as
encouraging the WTO to take a leadership role on trade-related issues in e-commerce.
• Strongly endorsed the need for Information Technology Agreement (ITA) by
recommending increased membership in the ITA to promote the development of e-
commerce infrastructure.
• These agreements ensure that all countries have access to the hardware and software
necessary to install and access the e-commerce infrastructure.
 • Issued a policy statement which includes "Principles for an electronic commerce-friendly
domain name system“ enumerating key principles applicable to future domain name
administration.
One of the more controversial questions about the Internet is should it be regulated, and if so, by
whom and how. The answers depend on whether a government wants loose or tight control of
their citizens since the Internet gives citizens access to the outside world and therefore differing
viewpoints.
The U.S. has chosen limited social regulation with tight technical standards and legal licensing
issues. In addition, there are few restrictions on who may access the Internet as long as there is
no criminal activity.
As previously noted, the Internet has made the world flat. This means issues such as intellectual
property, taxation, digital contracts, consumer protection, privacy protection, and computer
crimes now must be addressed globally. To appreciate the complexity, consider tax issues.
Should goods bought on the Internet be taxed and at what rates? Now, move that question
globally.
One of the more controversial questions about the Internet is should it be regulated, and if so, by
whom and how. The answers depend on whether a government wants loose or tight control of
their citizens since the Internet gives citizens access to the outside world and therefore differing
viewpoints.
The U.S. has chosen limited social regulation with tight technical standards and legal licensing
issues. In addition, there are few restrictions on who may access the Internet as long as there is
no criminal activity.
As previously noted, the Internet has made the world flat. This means issues such as intellectual
property, taxation, digital contracts, consumer protection, privacy protection, and computer
crimes now must be addressed globally. To appreciate the complexity, consider tax issues.
Should goods bought on the Internet be taxed and at what rates? Now, move that question
globally.
Many Internet users believe the Internet community should police itself; however, there are two
sides to the story.
• One argument in favor of government regulation is that such regulations could limit the
information corporations could gather regarding online consumers. These companies
collect consumer information based on the users' online activities, and use that
information for purposes of marketing. Some of these users/consumers want the practice
of profiling to be banned completely until laws can be passed that will truly protect
consumers. On the other hand, an increased government presence could offer the
possibility of an increase in government surveillance of online activities.
• On the other side, there are those who believe that self-regulation is the best way to
achieve consumer protection. These users are prepared to take a more active role in
controlling how their personal information can be used.
While both sides have merit, how many users or even the government understand the power of
analytics, i.e. data mining, on the Internet. If you don’t understand the issues, how can policy be
written?
Historically, the US Federal Trade Commission (FTC) has regulated commerce. It has now
moved into regulation of commerce on the Internet. The FTC is involved with the concept of
Internet self-regulation and Internet advertising companies. The Federal Trade Commission Act,
15 U.S.C. § 41-58, (originally passed in 1914, as amended) allows the FTC to act in the interest
of all consumers to prevent deceptive and unfair acts or practices. Section 5 of the FTC Act:
• Prohibits unfair or deceptive advertising in any medium (now expanded to include the
Internet).
• Enforces consumer protection laws in the context of the Internet in an effort to create a
safer online experience in which products and services are described truthfully in online
ads, so that consumers get what they pay for.
• Plays an important role in consumer protection by monitoring unfair and deceptive
practices on the Internet.
• Establish rules and regulations designed to prevent such practices.

Commercial Alert
On June 27, 2002, the FTC made a landmark recommendation to the search engine industry that
improved disclosure of paid content within search results. This recommendation was largely
based on litigation brought by Commercial Alert, a consumer activist group. Commercial Alert,
in one of the first major actions affecting the search engine industry, filed a complaint against
eight major search engine companies for violation of Section 5 of the FTC Act, 15 U.S.C. §
45(a)(1),(1) on July 16, 2001. It alleged that the search engines included websites in search
results lists based on fees, and that such search results were advertisements. Commercial Alert
contended that the search engines violated the FTC act by failing to disclose that advertisements
were inserted into search engine results lists. While the Plaintiffs did not definitively prove
whether the search engines in question violated the FTC Act, they did recommend that search
engines clearly and conspicuously disclose that certain companies have paid for higher
placement in the display of search results. This is the reason search providers clearly show
which results are the results of fees paid to the search engine providers.

FTC v. Carlos Pereira, et al.

In FTC v. Carlos Pereira, et al., Civil Action No. 99-1367-A (E.D. Va. 1999), the courts
dealt with page jacking and mouse trapping. The defendant used technical tricks to direct
consumers to sexually explicit, adult-oriented websites. It first captured and made
counterfeit copies of over 25 million web pages. When the consumers used search
engines to look up information on the Internet, they sometimes pulled up listings for
defendants' counterfeit sites. If a consumer clicked on the listing for a counterfeit site, he
 was taken immediately to sexually explicit adult websites operated by the defendant. The
defendant also disabled the consumer's normal browser functions, preventing the
consumer from exiting the adult sites. The FTC sued the defendant, alleging that these
practices expose consumers, including children, to unwanted, sexually explicit, adult-
oriented content. The Court agreed with the FTC, and entered default judgments and
permanent injunctions against the defendant. These injunctions barred the alleged activity
and permanently suspended the domain names they had used to perpetuate their scheme.

FTC v. Seismic Entertainment Productions, Inc.

In Federal Trade Commission v. Seismic Entertainment Productions, Inc., et al., Civil No. 04-
377-JD (2004), the FTC sought an injunction against the defendant, a spyware company,
contending that the defendant's marketing practices constituted unfair practices affecting
commerce. The FTC explained that the defendant had downloaded to consumers' computers,
without their knowledge or consent, a software program that altered the consumers' home pages
and redirected their browsers to websites selected by the defendant. The consumers complained
that their computers were damaged by these activities and that they were forced to invest
extensive efforts to remove the offending software downloaded by the defendants. The court
ruled in favor of the FTC. The temporary injunctive relief required the defendants to remove
from their websites the software script that allowed them to download this software to
consumers' computers without the consumers' knowledge.

Things that we take for granted today such as search engines returning results not based on
advertising, page jacking, and malicious downloads were not originally regulated in the Internet.
Click the boxes below to read about some of the original rulings that addressed these issues.
These rulings stopped these explicit practices but the practices are still occurring in modified forms. As
in any other media, criminals are playing a cat and mouse game with law enforcement. The result is law
enforcement is always playing catch up.

You have read articles about Internet regulations, but you are still not sure if you need to explore
this issue further. Should your company be concerned with how the Internet is regulated?
There are many different laws and regulations that have been created, and probably as many that
are presently evolving with a goal to regulate the Internet and online business. In addition to the
federal laws and self- regulations, there are a large number of international laws that may
concern you if your company offers services and products to international customers. Also, there
is the issue of legal jurisdiction in the case of a lawsuit that may be relevant for your business as
well.
E-commerce has led to various challenges and opportunities through new technologies. The
proliferation of new technologies is radically shaping business practices, including the increased
entrance into and execution of contracts through electronic means. This is called e- contracting.
It is important to note what e-contracting implies before we explain the rules. Most people think
of e-contracting as a big contract between two parties, for example a formal contract for
outsourcing of IT services between a state and a major IT player, such as Hewlett Packard. That
contract could be for hundreds of millions of dollars. E-contracting also applies when an
individual buys something off the Internet (i.e., Amazon). The dollar amounts may be much
smaller but the principles are the same.
Historically, the International Chamber of Commerce (ICC) helped to define terms and rules for
contracting internationally, where the contract was done by physical paper. When contracting
started to be done in mass over the Internet, the ICC created the ICC e-Terms 2004. By this, the
parties make it clear to arbitrators and judges who resolve disputes regarding their contract that
they do not have a dispute about the technical means by which they had contracted, where
“technical means” denotes electronically.
There may be some instances in which mandatory legal rules within a particular jurisdiction
create barriers to contracting electronically. In most cases however, a clear expression of
intention by contracting parties" constitutes a sufficient notice regarding the intention to contract
electronically. (International Chamber of Commerce, N.D.)
According to the International Chamber of Commerce, there are three ways in which parties to a
contract can apply ICC e-Terms 2004 to their contract:
• Within the limits permitted by any binding rules of the applicable law, the parties may
incorporate ICC e-Terms 2004 by reference into any contract they agree to enter through
electronic means, such as email, or communication through a Web application, or other
similar means.
• Parties can sign and exchange a paper version of ICC e-Terms 2004. In this paper
version, the parties will indicate the types of contract that they intend to pursue, and the
periods during which the ICC terms will apply. For instance, parties might decide that
electronic means such as email and/or other means will be used for any or all contracts
that will be entered into between the parties for a period of five years.
• Parties can exchange electronic messages signifying that they agree to ICC e-Terms
2004, and then to continue to contract through electronic means.
In order to create a more solid online business environment, your company should pay attention
to International Chamber of Commerce (ICC) e-Terms 2004. According to these terms, when the
parties to a contract agree to abide by International Chamber of Commerce (ICC) e-Terms 2004,
they agree to contract electronically. In most cases, a clear expression of intention by contracting
parties constitutes a sufficient notice regarding the intention to contract electronically. This intent
may be an important element in case of a dispute of an online contract.
While explained for the background of doing contracts electronically, you do not have to go to
the ICC e- Terms 2004 and struggle through pages of theory. Many trade associations,
universities, governmental agencies, and even commercial firms have template contracts online
that cover most if not all of the items.
An Offer
An offer requires a promise to do or refrain from doing some specified thing in the future.
One cannot contract to do something he/she had already been required to do or not to do,
either by statute or prior contract. A promise is a "manifestation of intent to act or refrain
from acting in a specified way, so as to justify a promise in understanding that a commitment
has been made." Restatement, Second Contracts Section 2, accord Day v. Amax, Inc., 701
F.2d 1258 (8th Cir. 1983). An offer must empower an offeree to create a valid contract by his
or her acceptance. Statements of intention or desires are not considered to be offers. An
inquiry or an invitation to make an offer is not a valid offer either. An advertisement, catalog,
or circular letter is generally not held to be an offer, but this rule depends on the exact
wording of the advertisement. If the words "first come, first served" are included, then the
advertisement can actually be considered an offer. Lefkowitz v. Great Minneapolis Surplus
Store, Inc., 251 Minn. 188, 86 N.W.2d 689 (1957).

Acceptance and Mutual Intent to Contract

Acceptance of an offer online has certain features. The acceptance of the offer must be
unconditional, and should not consist of any additional or different terms from the original
offer. Otherwise, a counteroffer exists and not an acceptance. No valid contract would be
formed around the original offer unless it was accepted with no additional terms

Consideration
Consideration requires the compensation or promise that is given in return for a promise. The
money therefore is paid or promised in return for the goods or services. Consideration is the
price or the return for a promise that turns that promise into a legally binding contract.

Consent
There must be consent by the contracting parties to enter into a contract. The contracting
parties must understand the contract in the same sense; otherwise, there cannot be an
agreement or contract. When a customer enters a website, before he/she proceeds to order a
product such as a digital camera, the customer should be asked to read and acknowledge that
he/she has read the appropriate terms and conditions prior to clicking the purchase button for
the camera. The reason for scrolling through the appropriate terms and conditions is to be
able to claim that there indeed was informed consent by the contracting party to enter into a
contract, or that there was intent to enter into a contract. Another example of consent is
what happens when you install software. An End User Licensing Agreement (EULA) should
 pop up during the installation process that forces you to agree to the terms and conditions of
use before the installation can proceed. This is a contract.

Every contract involves at least one promise that has legal consequences. A contract is a
promise, or set of promises, for breach of which the law gives a remedy, or the performance of
which the law in some way recognizes as a duty. (Williston, Contracts Section 1 [3d ed. 1957]).
Click on each box below to review the valid requirements for an electronic contract.
According to the International Chamber of Commerce, many times a contract contains
information that is commercially sensitive or legally restricted, including information regarding
the parties' businesses or identities. Obviously, such information often requires confidential
treatment; its electronic storage location may be vulnerable to attackers, and so may require
higher security than other applications. Therefore, while designing an application for e-
contracting (for example a website), the confidentiality of the contracting documents has to be
taken into account.
Precautionary measures must be applied continuously, not only when information is transmitted
and received at the establishment of the contract, but also when information is transmitted and
received during the contract life. Since there is a risk of unauthorized dissemination of
information, the company and its officers must be prepared for possible liability that the
company and its customers might face. It is extremely important that the contract contain a
confidentiality clause, and should mention liability for breach of confidentiality.
The ICC states that it is very important to recognize the risks particular to new technologies. For
example, if certain information that is stored on the electronic means is lost, damaged, or
exposed, then there would be negative consequences both in terms of liability to counterparties
and in terms of adverse publicity for the company.
Steps can be taken to minimize risk through technical, procedural or contractual means, or
through insurance coverage. Additionally, some simple steps can be taken to reduce the technical
failure risks. For example, transmission failure can be guarded against by requiring confirmation
of receipt.
In addition to the ICC online contracting terms, there are six principles that were created by the
American Bar Association (ABA) to assist with drafting enforceable electronic contracts. These
principles are:
1. The user must be apprised of the contract terms and have continual access to review those
terms.
2. Contract terms must be displayed in compliance with legal requirements.
3. The user must be apprised of the consequences of clicking assent.
4. The assent process must offer practical ways for the user to correct mistakes made in that
process.
5. Term agreements must offer both an "I Agree" and an "I Disagree" button.
6. Licensors, or those issuing the contracts, are urged to offer the user a printable version of
the contract terms and assent.
These principles may come handy when designing a website and creating an online business that
involves online sales.
Except for the medium of terms and conditions exchange, there is no difference between e-
contracting and paper contracting. The major differences are for e-contracting you need a method
to prove digital signatures and non-repudiation of the contract. Paper contracts easily provide for
these two. Electronic contracts have to have extensive security to conclusively provide for these
two items.
Employers are legitimately concerned about employees' use of the Internet in the workplace.
Besides wasting the company's time by surfing on recreational sites, employees can create
liability by exchanging improper emails or other material (e.g. pornography, racist remarks,
emails containing sexually harassing comments, etc.) Monitoring employees could be necessary;
but before putting a monitoring device in place, the employer should be cognizant of the basic
legal privacy principles. (IBLS, N.D.)
Pursuant to federal law, employees do have a reasonable expectation of privacy. Employers also
have a right to monitor their employees; however, the employer should not introduce software
such as Surf Watch, Telemate, Little Brother, WinWhatWhere, etc., which allow the computer
owner to monitor computer use without alerting the computer user, before fully understanding
how the various constitutional, common law and statutory rules work together. Without a full
understanding of the risks, employers may open themselves up to potential privacy lawsuits.
AWR-168: Module 1: Reasonable Expectation Of Privacy

Click the Next button to continue.

© 2013 Texas A&M Engineering Extension Service. All rights reserved.

Cyber Law and
White Collar Crime
Page 29 of 46
"According to current law, proving a
reasonable expectation of privacy is
contingent on two things:
• A subjective expectation of privacy
• Expectation of privacy typically
recognized by society
There is no definitive rule on when an
expectation of privacy is constitutionally
reasonable."
“For example, the Supreme Court has held
that a person has a reasonable expectation
of privacy in property located inside a person’s home in conversations taking place in an
enclosed phone booth and in the contents of opaque containers. In contrast, a person does not
have a reasonable expectation of privacy in activities conducted in open fields in garbage
deposited at the outskirts of real property or in a stranger’s house that the person has entered
without the owner’s consent in order to commit a theft (IT Law Wiki).”
Click the image to read an example case regarding expectation of privacy
Pursuant to Title III of the Omnibus Crime Control and Safe Streets Act, as amended by Title I
of the Electronic Communications Privacy Act (ECPA), it is illegal for any person to
intentionally intercept the contents of any wire or electronic communication and to disclose or
use any illegally intercepted communication. Any violation of this rule constitutes a felony,
punishable by five years imprisonment. An aggrieved person has a private right of action for:
• The greater of actual or statutory damages.
• Punitive damages.
• Attorneys' fees.
"Electronic communication means any transfer of signs, signals, writing, images, sounds, data or
intelligence of any nature transmitted in whole or in part by a wire, radio, electromagnetic,
photoelectronic or photo optical system that affects interstate or foreign commerce." (Electronic
Communication Privacy Act) This definition covers the use of emails and the Internet in the
workplace (as opposed to the Intranet, which might be in-state and therefore not be interstate
commerce). Click the image to learn about the exceptions to the law.

Exceptions To The Law

There are exceptions, such as 18 USC 2511 2(a)(i), which states: "(i) It shall not be
unlawful under this chapter for an operator of a switchboard, or an officer, employee, or
agent of a provider of wire or electronic communication service, whose facilities are used
in the transmission of a wire or electronic communication, to intercept, disclose, or use
that communication in the normal course of his employment while engaged in any activity
which is a necessary incident to the rendition of his service or to the protection of the
rights or property of the provider of that service, except that a provider of wire
communication service to the public shall not utilize service observing or random
monitoring except for mechanical or service quality control checks" (18 U.S.C. section
2511).
Considering that the goal of Title III is "to protect individual privacy by strictly limiting
occasion on which interception may lawfully take place" (Watkins. 704 F.2d at 581),
employers should affirmatively obtain employees' consent to the monitoring of email and
the Internet.

The ICC has also engaged in the following activities:

• Published a strategy for promoting the development of the necessary infrastructure for
conducting e- commerce and for developing trade in goods and services via e-commerce.
• The Uniform Electronic Transactions Act (UETA), adopted into law in 47 states,
District of Columbia, Puerto Rico and the Virgin Islands, has a purpose to:
 • "establish the legal equivalence of electronic records and signatures with paper
writings and manually-signed signatures, removing barriers to electronic
commerce" (Uniform Law Commissioners).
• Proposed various recommendations for the development of e-commerce, such as
encouraging the WTO to take a leadership role on trade-related issues in e-commerce.
• Strongly endorsed the need for Information Technology Agreement (ITA) by
recommending increased membership in the ITA to promote the development of e-
commerce infrastructure.
• These agreements ensure that all countries have access to the hardware and software
necessary to install and access the e-commerce infrastructure.
• Issued a policy statement which includes "Principles for an electronic commerce-friendly
domain name system“ enumerating key principles applicable to future domain name
administration.
One of the more controversial questions about the Internet is should it be regulated, and if so, by
whom and how. The answers depend on whether a government wants loose or tight control of
their citizens since the Internet gives citizens access to the outside world and therefore differing
viewpoints.
The U.S. has chosen limited social regulation with tight technical standards and legal licensing
issues. In addition, there are few restrictions on who may access the Internet as long as there is
no criminal activity.
As previously noted, the Internet has made the world flat. This means issues such as intellectual
property, taxation, digital contracts, consumer protection, privacy protection, and computer
crimes now must be addressed globally. To appreciate the complexity, consider tax issues.
Should goods bought on the Internet be taxed and at what rates? Now, move that question
globally.
One of the more controversial questions about the Internet is should it be regulated, and if so, by
whom and how. The answers depend on whether a government wants loose or tight control of
their citizens since the Internet gives citizens access to the outside world and therefore differing
viewpoints.
The U.S. has chosen limited social regulation with tight technical standards and legal licensing
issues. In addition, there are few restrictions on who may access the Internet as long as there is
no criminal activity.
As previously noted, the Internet has made the world flat. This means issues such as intellectual
property, taxation, digital contracts, consumer protection, privacy protection, and computer
crimes now must be addressed globally. To appreciate the complexity, consider tax issues.
Should goods bought on the Internet be taxed and at what rates? Now, move that question
globally.
Many Internet users believe the Internet community should police itself; however, there are two
sides to the story.
 • One argument in favor of government regulation is that such regulations could limit the
information corporations could gather regarding online consumers. These companies
collect consumer information based on the users' online activities, and use that
information for purposes of marketing. Some of these users/consumers want the practice
of profiling to be banned completely until laws can be passed that will truly protect
consumers. On the other hand, an increased government presence could offer the
possibility of an increase in government surveillance of online activities.
• On the other side, there are those who believe that self-regulation is the best way to
achieve consumer protection. These users are prepared to take a more active role in
controlling how their personal information can be used.
While both sides have merit, how many users or even the government understand the power of
analytics, i.e. data mining, on the Internet. If you don’t understand the issues, how can policy be
written?
Historically, the US Federal Trade Commission (FTC) has regulated commerce. It has now
moved into regulation of commerce on the Internet. The FTC is involved with the concept of
Internet self-regulation and Internet advertising companies. The Federal Trade Commission Act,
15 U.S.C. § 41-58, (originally passed in 1914, as amended) allows the FTC to act in the interest
of all consumers to prevent deceptive and unfair acts or practices. Section 5 of the FTC Act:
• Prohibits unfair or deceptive advertising in any medium (now expanded to include the
Internet).
• Enforces consumer protection laws in the context of the Internet in an effort to create a
safer online experience in which products and services are described truthfully in online
ads, so that consumers get what they pay for.
• Plays an important role in consumer protection by monitoring unfair and deceptive
practices on the Internet.
• Establish rules and regulations designed to prevent such practices.

Commercial Alert
On June 27, 2002, the FTC made a landmark recommendation to the search engine industry that
improved disclosure of paid content within search results. This recommendation was largely
based on litigation brought by Commercial Alert, a consumer activist group. Commercial Alert,
in one of the first major actions affecting the search engine industry, filed a complaint against
eight major search engine companies for violation of Section 5 of the FTC Act, 15 U.S.C. §
45(a)(1),(1) on July 16, 2001. It alleged that the search engines included websites in search
results lists based on fees, and that such search results were advertisements. Commercial Alert
contended that the search engines violated the FTC act by failing to disclose that advertisements
were inserted into search engine results lists. While the Plaintiffs did not definitively prove
whether the search engines in question violated the FTC Act, they did recommend that search
engines clearly and conspicuously disclose that certain companies have paid for higher
 placement in the display of search results. This is the reason search providers clearly show
which results are the results of fees paid to the search engine providers.

FTC v. Carlos Pereira, et al.

In FTC v. Carlos Pereira, et al., Civil Action No. 99-1367-A (E.D. Va. 1999), the courts
dealt with page jacking and mouse trapping. The defendant used technical tricks to direct
consumers to sexually explicit, adult-oriented websites. It first captured and made
counterfeit copies of over 25 million web pages. When the consumers used search
engines to look up information on the Internet, they sometimes pulled up listings for
defendants' counterfeit sites. If a consumer clicked on the listing for a counterfeit site, he
was taken immediately to sexually explicit adult websites operated by the defendant. The
defendant also disabled the consumer's normal browser functions, preventing the
consumer from exiting the adult sites. The FTC sued the defendant, alleging that these
practices expose consumers, including children, to unwanted, sexually explicit, adult-
oriented content. The Court agreed with the FTC, and entered default judgments and
permanent injunctions against the defendant. These injunctions barred the alleged activity
and permanently suspended the domain names they had used to perpetuate their scheme.

FTC v. Seismic Entertainment Productions, Inc.

In Federal Trade Commission v. Seismic Entertainment Productions, Inc., et al., Civil No. 04-
377-JD (2004), the FTC sought an injunction against the defendant, a spyware company,
contending that the defendant's marketing practices constituted unfair practices affecting
commerce. The FTC explained that the defendant had downloaded to consumers' computers,
without their knowledge or consent, a software program that altered the consumers' home pages
and redirected their browsers to websites selected by the defendant. The consumers complained
that their computers were damaged by these activities and that they were forced to invest
extensive efforts to remove the offending software downloaded by the defendants. The court
ruled in favor of the FTC. The temporary injunctive relief required the defendants to remove
from their websites the software script that allowed them to download this software to
consumers' computers without the consumers' knowledge.

Things that we take for granted today such as search engines returning results not based on
advertising, page jacking, and malicious downloads were not originally regulated in the Internet.
Click the boxes below to read about some of the original rulings that addressed these issues.
These rulings stopped these explicit practices but the practices are still occurring in modified forms. As
in any other media, criminals are playing a cat and mouse game with law enforcement. The result is law
enforcement is always playing catch up.
You have read articles about Internet regulations, but you are still not sure if you need to explore
this issue further. Should your company be concerned with how the Internet is regulated?
There are many different laws and regulations that have been created, and probably as many that
are presently evolving with a goal to regulate the Internet and online business. In addition to the
federal laws and self- regulations, there are a large number of international laws that may
concern you if your company offers services and products to international customers. Also, there
is the issue of legal jurisdiction in the case of a lawsuit that may be relevant for your business as
well.
E-commerce has led to various challenges and opportunities through new technologies. The
proliferation of new technologies is radically shaping business practices, including the increased
entrance into and execution of contracts through electronic means. This is called e- contracting.
It is important to note what e-contracting implies before we explain the rules. Most people think
of e-contracting as a big contract between two parties, for example a formal contract for
outsourcing of IT services between a state and a major IT player, such as Hewlett Packard. That
contract could be for hundreds of millions of dollars. E-contracting also applies when an
individual buys something off the Internet (i.e., Amazon). The dollar amounts may be much
smaller but the principles are the same.
Historically, the International Chamber of Commerce (ICC) helped to define terms and rules for
contracting internationally, where the contract was done by physical paper. When contracting
started to be done in mass over the Internet, the ICC created the ICC e-Terms 2004. By this, the
parties make it clear to arbitrators and judges who resolve disputes regarding their contract that
they do not have a dispute about the technical means by which they had contracted, where
“technical means” denotes electronically.
There may be some instances in which mandatory legal rules within a particular jurisdiction
create barriers to contracting electronically. In most cases however, a clear expression of
intention by contracting parties" constitutes a sufficient notice regarding the intention to contract
electronically. (International Chamber of Commerce, N.D.)
According to the International Chamber of Commerce, there are three ways in which parties to a
contract can apply ICC e-Terms 2004 to their contract:
• Within the limits permitted by any binding rules of the applicable law, the parties may
incorporate ICC e-Terms 2004 by reference into any contract they agree to enter through
electronic means, such as email, or communication through a Web application, or other
similar means.
• Parties can sign and exchange a paper version of ICC e-Terms 2004. In this paper
version, the parties will indicate the types of contract that they intend to pursue, and the
periods during which the ICC terms will apply. For instance, parties might decide that
electronic means such as email and/or other means will be used for any or all contracts
that will be entered into between the parties for a period of five years.
• Parties can exchange electronic messages signifying that they agree to ICC e-Terms
2004, and then to continue to contract through electronic means.
In order to create a more solid online business environment, your company should pay attention
to International Chamber of Commerce (ICC) e-Terms 2004. According to these terms, when the
parties to a contract agree to abide by International Chamber of Commerce (ICC) e-Terms 2004,
they agree to contract electronically. In most cases, a clear expression of intention by contracting
parties constitutes a sufficient notice regarding the intention to contract electronically. This intent
may be an important element in case of a dispute of an online contract.
While explained for the background of doing contracts electronically, you do not have to go to
the ICC e- Terms 2004 and struggle through pages of theory. Many trade associations,
universities, governmental agencies, and even commercial firms have template contracts online
that cover most if not all of the items.
An Offer
An offer requires a promise to do or refrain from doing some specified thing in the future.
One cannot contract to do something he/she had already been required to do or not to do,
either by statute or prior contract. A promise is a "manifestation of intent to act or refrain
from acting in a specified way, so as to justify a promise in understanding that a commitment
has been made." Restatement, Second Contracts Section 2, accord Day v. Amax, Inc., 701
F.2d 1258 (8th Cir. 1983). An offer must empower an offeree to create a valid contract by his
or her acceptance. Statements of intention or desires are not considered to be offers. An
inquiry or an invitation to make an offer is not a valid offer either. An advertisement, catalog,
or circular letter is generally not held to be an offer, but this rule depends on the exact
wording of the advertisement. If the words "first come, first served" are included, then the
advertisement can actually be considered an offer. Lefkowitz v. Great Minneapolis Surplus
Store, Inc., 251 Minn. 188, 86 N.W.2d 689 (1957).

Acceptance and Mutual Intent to Contract

Acceptance of an offer online has certain features. The acceptance of the offer must be
unconditional, and should not consist of any additional or different terms from the original
offer. Otherwise, a counteroffer exists and not an acceptance. No valid contract would be
formed around the original offer unless it was accepted with no additional terms

Consideration
Consideration requires the compensation or promise that is given in return for a promise. The
money therefore is paid or promised in return for the goods or services. Consideration is the
price or the return for a promise that turns that promise into a legally binding contract.
 Consent
There must be consent by the contracting parties to enter into a contract. The contracting
parties must understand the contract in the same sense; otherwise, there cannot be an
agreement or contract. When a customer enters a website, before he/she proceeds to order a
product such as a digital camera, the customer should be asked to read and acknowledge that
he/she has read the appropriate terms and conditions prior to clicking the purchase button for
the camera. The reason for scrolling through the appropriate terms and conditions is to be
able to claim that there indeed was informed consent by the contracting party to enter into a
contract, or that there was intent to enter into a contract. Another example of consent is
what happens when you install software. An End User Licensing Agreement (EULA) should
pop up during the installation process that forces you to agree to the terms and conditions of
use before the installation can proceed. This is a contract.

Every contract involves at least one promise that has legal consequences. A contract is a
promise, or set of promises, for breach of which the law gives a remedy, or the performance of
which the law in some way recognizes as a duty. (Williston, Contracts Section 1 [3d ed. 1957]).
Click on each box below to review the valid requirements for an electronic contract.
According to the International Chamber of Commerce, many times a contract contains
information that is commercially sensitive or legally restricted, including information regarding
the parties' businesses or identities. Obviously, such information often requires confidential
treatment; its electronic storage location may be vulnerable to attackers, and so may require
higher security than other applications. Therefore, while designing an application for e-
contracting (for example a website), the confidentiality of the contracting documents has to be
taken into account.
Precautionary measures must be applied continuously, not only when information is transmitted
and received at the establishment of the contract, but also when information is transmitted and
received during the contract life. Since there is a risk of unauthorized dissemination of
information, the company and its officers must be prepared for possible liability that the
company and its customers might face. It is extremely important that the contract contain a
confidentiality clause, and should mention liability for breach of confidentiality.
The ICC states that it is very important to recognize the risks particular to new technologies. For
example, if certain information that is stored on the electronic means is lost, damaged, or
exposed, then there would be negative consequences both in terms of liability to counterparties
and in terms of adverse publicity for the company.
Steps can be taken to minimize risk through technical, procedural or contractual means, or
through insurance coverage. Additionally, some simple steps can be taken to reduce the technical
failure risks. For example, transmission failure can be guarded against by requiring confirmation
of receipt.
In addition to the ICC online contracting terms, there are six principles that were created by the
American Bar Association (ABA) to assist with drafting enforceable electronic contracts. These
principles are:
 1. The user must be apprised of the contract terms and have continual access to review those
terms.
2. Contract terms must be displayed in compliance with legal requirements.
3. The user must be apprised of the consequences of clicking assent.
4. The assent process must offer practical ways for the user to correct mistakes made in that
process.
5. Term agreements must offer both an "I Agree" and an "I Disagree" button.
6. Licensors, or those issuing the contracts, are urged to offer the user a printable version of
the contract terms and assent.
These principles may come handy when designing a website and creating an online business that
involves online sales.
Except for the medium of terms and conditions exchange, there is no difference between e-
contracting and paper contracting. The major differences are for e-contracting you need a method
to prove digital signatures and non-repudiation of the contract. Paper contracts easily provide for
these two. Electronic contracts have to have extensive security to conclusively provide for these
two items.
Employers are legitimately concerned about employees' use of the Internet in the workplace.
Besides wasting the company's time by surfing on recreational sites, employees can create
liability by exchanging improper emails or other material (e.g. pornography, racist remarks,
emails containing sexually harassing comments, etc.) Monitoring employees could be necessary;
but before putting a monitoring device in place, the employer should be cognizant of the basic
legal privacy principles. (IBLS, N.D.)
Pursuant to federal law, employees do have a reasonable expectation of privacy. Employers also
have a right to monitor their employees; however, the employer should not introduce software
such as Surf Watch, Telemate, Little Brother, WinWhatWhere, etc., which allow the computer
owner to monitor computer use without alerting the computer user, before fully understanding
how the various constitutional, common law and statutory rules work together. Without a full
understanding of the risks, employers may open themselves up to potential privacy lawsuits.
AWR-168: Module 1: Reasonable Expectation Of Privacy

Click the Next button to continue.

© 2013 Texas A&M Engineering Extension Service. All rights reserved.

Cyber Law and
White Collar Crime
Page 29 of 46
"According to current law, proving a
reasonable expectation of privacy is
contingent on two things:
• A subjective expectation of privacy
• Expectation of privacy typically
recognized by society
There is no definitive rule on when an
expectation of privacy is constitutionally
reasonable."
“For example, the Supreme Court has held
that a person has a reasonable expectation
of privacy in property located inside a person’s home in conversations taking place in an
enclosed phone booth and in the contents of opaque containers. In contrast, a person does not
have a reasonable expectation of privacy in activities conducted in open fields in garbage
deposited at the outskirts of real property or in a stranger’s house that the person has entered
without the owner’s consent in order to commit a theft (IT Law Wiki).”
Click the image to read an example case regarding expectation of privacy
Pursuant to Title III of the Omnibus Crime Control and Safe Streets Act, as amended by Title I
of the Electronic Communications Privacy Act (ECPA), it is illegal for any person to
intentionally intercept the contents of any wire or electronic communication and to disclose or
use any illegally intercepted communication. Any violation of this rule constitutes a felony,
punishable by five years imprisonment. An aggrieved person has a private right of action for:
• The greater of actual or statutory damages.
• Punitive damages.
• Attorneys' fees.
"Electronic communication means any transfer of signs, signals, writing, images, sounds, data or
intelligence of any nature transmitted in whole or in part by a wire, radio, electromagnetic,
photoelectronic or photo optical system that affects interstate or foreign commerce." (Electronic
Communication Privacy Act) This definition covers the use of emails and the Internet in the
workplace (as opposed to the Intranet, which might be in-state and therefore not be interstate
commerce). Click the image to learn about the exceptions to the law.
Employees sending personal emails or browsing through recreational websites at the office could
reduce productivity. This recreational surfing might also create legal problems for the employer,
such as disclosure of trade secrets, sexual harassment claims, copyright infringement, and
invasions of privacy accusations. The solution to this legal risk includes the introduction of well-
crafted and stringently enforced Internet and email policies.
At a minimum, it should be specifically stated in a company's policies that all telephone,
computer, and Internet communications may be monitored, and that the content of such
communications may be disclosed as the company deems necessary to protect its interests.
What should email and Internet policies contain? Click the image below to learn more.
State law actions exist for use against those who violate privacy rights. Although each state
approaches the matter in its own way, they all penalize invasion of privacy. The right of
employers to monitor their employees' mail has potentially constituted a claim arising under the
privacy torts. Click the button below to learn more.
Generally, employees who have argued that there is reasonable expectation of privacy due to
their password protections have not had successful arguments. Below are two examples of law
suits filed by employees suing their employers. Click on each box to read more.

State Privacy Laws

Each state has taken a different approach to the following torts and whether or not there is a
right to sue for the various theories of action.
Torts:
• Public disclosure of private facts
 • Appropriation
• False light
• Intrusion

Smyth v. The Pillsbury Co.

An employee sued his company for wrongful termination after he was fired for writing
emails criticizing management. The court determined that Smyth did not have a reasonable
expectation of privacy in his emails, despite the company's promises, and could not claim
that his termination was a violation of any public policy.

McLaren v. Microsoft Corporation

The court found that the email messages contained on the company computer are not the
employees' personal property, but are merely an inherent part of the office environment. The
court concluded that the company's interest in preventing inappropriate and unprofessional
comments, or even illegal activity, over its email system outweighs the employee's claimed
privacy interest in those communications.

Some cases have illustrated that informing employees that emailing and Internet surfing on
company equipment is subject to monitoring would prevent potential subsequent confusion of its
employees. Devising an appropriate employment policy that specifically outlines the Internet
policies would be practical since the employees would then be aware of the business practices
that could occur. A company should:
• Delineate the penalties for specific policy violations.
• Communicate them to the employees.
• Enforce them consistently.
• Consider obtaining written or signed acknowledgements of these precepts.
It is common to see employees suing employers for the monitoring of electronic communications
either under common law claims or under applicable federal and state rulings. However,
generally, employers are finding that they are indeed entitled to monitor employees' use of
company electronic mail and the Internet. The fact remains that there is a risk of litigation and
that not every court will be uniform in determining relevant rights.
The System Administration, Networking and Security Institute (SANS) Institute was established
in 1989 as a cooperative research and education organization on security matters for IT. They
state that employers should:
 • Include procedures in the policy that encourage early reporting by employees of
offensive practices.
• Implement internal procedures to effectuate a prompt, fair investigation of employee
complaints involving the use of Internet and email transmissions.
• Communicate to supervisors and managers the importance of early reporting of policy
abuses, and carefully monitor policy compliance.
• Periodically review Internet and email policies for legal compliance.
How do you verify employees have learned the company’s usage restrictions and accept them?
Many companies have a mandatory, yearly policy training class that is given online. Employees
must make a minimum score, and the scores with the date of completion are logged into an HR
database. The training covers Internet usage, security on the Internet, etc.
A “Rules of Behavior” document should be provided by the company and signed by
employees. This agreement signals to the employer that the undersigned employee understands
and accepts the company’s policy on internet usage. This document should be revisited every
calendar year in an effort to ensure that all company employees are informed of what is expected
in terms of company property and usage of the world wide web. This document can be included
in the company’s yearly computer security training.
Another method of reinforcement is the use of a banner message which states usage restrictions
being placed on employee login screens.
Now that your company is introducing online aspects to its business model, your employer needs
to understand the significance of an employee's right to privacy. This is a concern particularly
due to employees' Internet access during regular business hours. To prevent the risks associated
with the employees' Internet use, you should recommend that guidelines must be incorporated
into your company's IT policy, outlining acceptable employee use of email and Internet. This
policy should describe how and under what circumstances your company would monitor
electronic communications, so that employees have sufficient notice of such monitoring
Online marketing is becoming popular among both sellers and consumers. Some sellers will
resort to a variety of marketing tricks for unfair advantage. Some of these practices include
paying fees to search engines in order to get higher ranking in their search results, and
downloading software onto a consumer's computer without consent. In order to maintain the
credibility of the search engines as an advertising medium, the US Federal Trade Commission
(FTC) has come forward as the primary regulator of Internet marketing.
More and more consumers are using search engines as research tools to locate the products and
services they want. As the number of companies advertising online grows, the potential for fraud
and deception in online advertising also increases.
Advertising must follow certain guidelines mandated by the Federal Trade Commission Act,
which prohibits unfair or deceptive acts or practices. This same concept has moved to apply to
the Internet.
As stated in the FTC Act,
 • Online advertising must be truthful and not misleading.
• The advertisements must have evidence to substantiate their claims.
• Advertisements must not be unfair.
• The unique features in Internet ads also may affect how an ad and any required
disclosures are evaluated.
Fraud and deception run rampant through the Internet medium. The FTC has enforced its
consumer protection laws online to ensure that products and services are described truthfully in
online ads for the protection of the consumers as well as sellers, to support a fair
marketplace (Federal Trade Commission Act).

The Federal Trade Commission has stated that all of the laws and regulations applicable to print
advertisements, television and radio commercials, and telemarketing apply to the Internet as
well.
Accordingly, the Commission's role in protecting consumers from unfair or deceptive acts or
practices encompasses advertising, marketing, and sales online, as well as the same activities in
print, television, telephone, and radio. Since 1994, the Commission has initiated many law
enforcement actions to stop fraud and deception online. It is working to educate businesses about
their legal obligations and consumers about their rights (Federal Trade Commission Act).
Before going further, it must be remembered that the FTC is an American agency. The Internet is
global. What is restricted in this country may not be restricted or even enforced in another
country. The FTC can only regulate in this country, and has to work with international agencies
to attempt to enforce rules in other countries.
The FTC provides specific guidelines to ensure that advertisements comply with the "clear and
conspicuous" disclosure requirements. The FTC recommends that disclosures be placed as close
to the body of the advertisement as possible; and if there is adequate room, the disclosure should
be on the same page as the advertisement. If there is not sufficient space, then the hyperlink to
the disclosure should be labeled appropriately. Disclosure must be obvious and prominently
displayed, and should be accessible from marketing pages.
The marketing elements should not distract the viewer's attention from the disclosures. The FTC
requires audio disclosures for Internet audio ads, and video disclosures for Internet video ads. All
disclosures must be rendered in clear and plain English. Disclosures also must be accessible
through every appropriate page on the company's website.
According to the Federal Trade Commission, there are certain factors that determine whether a
particular disclosure is clear and conspicuous. These factors involve:
• The placement of the disclosure in an advertisement and its proximity to the claim it is
qualifying.
• Whether items in other parts of the advertisement distract attention from the disclosure.
• Whether the advertisement is so lengthy that the disclosure needs to be repeated.
 • Whether disclosures in audio messages are presented in an adequate volume and cadence
and visual disclosures appear for a sufficient duration.
• Whether the language of the disclosure is understandable to the intended audience.
Advertisers must consider all of the factors and evaluate an actual disclosure in the context of an
ad as a whole. Click the image to learn more about disclosures.
Disclosures
While this seems clear-cut, it is important to note technology always outpaces laws. For
example, what about “Photoshopping” elements of the pictorial representation of the products?
Must the seller disclose that the “super, clean floor done by our steam mop” was touched up?
Was the touch-up just for rendering purposes on the Web or to deceive? Currently (2013), there
is no ruling on these types of issues.
The FTC also has the power to initiate federal district court proceedings to enjoin violations of
the FTC Act. Click on the gavel to learn more about a case.
While the FTC is playing a pivotal role in protecting consumers from deceptive practices,
consumers must be vigilant in monitoring and trying to prevent frauds and unfair practices on the
Internet. For example, most antivirus programs today include a firewall that blocks known
fraudulent websites. This means that it is vitally important that you use an up-to-date antivirus
program with these capabilities.

Unfair Practices on the Internet

A landmark case of unfair practices on the Internet was Federal Trade Commission v.
Seismic Entertainment Productions, Inc., et al., Civil No. 04-377-JD (2004). Here, the
FTC sought an injunction against the defendant, a spyware company, contending that the
defendant's marketing practices constituted unfair practices affecting commerce. The FTC
explained that, without the users' knowledge or consent, the defendant had downloaded a
software program to consumers' computers. The unsolicited program altered the
consumers' home pages and redirected their browsers to websites selected by the
defendant. The consumers complained that their computers were damaged by these
activities, and that they were forced to invest extensive efforts to remove the offending
software downloaded by the defendants. The court ruled in favor of the FTC and issued
temporary injunctive relief. The ruling required the defendants to remove the offending
software script.

When creating online ads you should make sure there is no room for a misinterpretation and/or
misunderstanding by a consumer, and the advertisement is in no way deceiving. Although many
companies advertise online and the number of consumers shopping online is soaring, fraud and
deception have dampened consumer confidence in the e-marketplace. That is why you must
ensure that your company's products and services are described truthfully in online ads -- for the
protection of the consumers, and for your company to support a fair marketplace

Your company established an Employee Internet Privacy Policy; but despite its existence,
several employees have been complaining that their online privacy is invaded because the
management has a list of all Internet passwords and usernames (on the company's network). You
review your company's policy to see how these issues are being addressed, and to find if there
are other possible reasons for privacy-related complaints. In addition, you also decide to review
some of the other company policies. You will study the policies relating to advertising disclosure
as well as online contracting to ensure that they are in line with current regulations.
Consider the following questions and type your answers in the spaces provided.

Cyber Law and White Collar Crime Module 1 Post-Test