House Passes Legislation to Combat Spyware

Media Contact: Heather Wong, 202.225.3072

Washington, DC – {The House of Representatives today passed the Internet Spyware (I-SPY) Prevention Act of 2004, H.R. 4661, which was introduced by Representatives Bob Goodlatte (R-VA-06), Zoe Lofgren (D-CA-16) and Lamar Smith (R-TX-21). This bipartisan legislation, which passed 415-0, addresses the most egregious activities that are conducted via spyware and makes those activities criminal offenses.

Spyware has been defined as “software that aids in gathering information about a person or organization without their knowledge and which may send such information to another entity without the consumer’s consent, or asserts control over a computer without the consumer’s knowledge.” In April, the Federal Trade Commission testified before a House Subcommittee that “spyware appears to be a new and rapidly growing practice that poses a risk of serious harm to consumers.”

“I am pleased by the passage of this legislation through the House,” Goodlatte said. “By imposing criminal penalties on these bad actors, this legislation will help deter the use of spyware, and will thus help protect consumers from these aggressive attacks. At the same time, the legislation leaves the door open for innovative technology developments to continue to combat spyware programs.”

The legislation would make the following criminal offenses:

    * Intentionally accessing a computer without authorization, or intentionally exceeding authorized access, by causing a computer program or code to be copied onto the computer and using that program or code to
          o Further another federal criminal offense (punishable by fine or imprisonment for up to 5 years)
          o Intentionally obtain or transmit “personal information” with the intent of injuring or defrauding a person or damaging a computer (punishable by fine or imprisonment for up to 2 years)
          o Intentionally impair the security protections of a computer (punishable by fine or imprisonment for up to 2 years)

The legislation includes language to preempt States from creating civil remedies based on violations of this act.

The legislation also authorizes $10 million to the Department of Justice to combat spyware and phishing scams. “Phishing” scams typically involve the use of fake e-mail messages and websites to lure consumers into providing bank account information, credit card numbers and other personal information. These fake e-mail messages and websites are often indistinguishable from the real ones and often request account information from consumers.

“Spyware is a very real problem that is endangering consumers, damaging businesses, and creating millions of dollars of additional costs.   My colleagues and I worked in a bipartisan way to ensure that this measure identifies the truly unscrupulous acts associated with spyware and subjects them to criminal punishment, and I am thrilled by its passage,” said Rep. Zoe Lofgren. “I am also honored that this bill has the strong support of some of the biggest names in technology, and it is also supported by the US Chamber of Commerce, the Center for Democracy and Technology, and even the Distributed Computing Industry Association, which represents peer-to-peer networks.”

Spyware encompasses several potential risks including the promotion of identity theft, by harvesting personal information from consumers’ computers. Additionally, it can adversely affect businesses, as they are forced to sustain costs to block and remove spyware from employees’ computers, not to mention the potential impact on productivity.

Rep. Lamar Smith commented, "Every day thousands of unsuspecting Americans have their identities hijacked by a new breed of cyber criminals because of spyware. People whose identities have been stolen can spend months or years - and much of their hard-earned money – trying to restore their good name and credit record.   This legislation will help prevent bad things from happening to good names."

There is also a growing concern that persistent computer security vulnerabilities may expose U.S. critical infrastructure and government computer systems to cyber attacks, which would ultimately jeopardize national security and the economy.

“The Center for Democracy and Technology has seen several egregious examples of spyware being used in ways that most Americans would think clearly ought to be criminal. The Goodlatte, Lofgren, and Smith bill will help make sure that there are strong deterrents to using spyware to defraud or injure consumers,” said Ari Schwartz, Associate Director of the Center for Democracy and Technology, part of a broad coalition of consumer groups addressing the spyware problem.