Senator introduces 'phishing' penalties bill

Fraudsters could go to jail for up to five years under the legislation

Fraudsters who create authentic-looking Web sites in an effort to get customers of a legitimate e-commerce site to provide financial or other personal information could go to jail for up to five years under legislation introduced in the U.S. Senate.

The Anti-Phishing Act of 2004, introduced Friday by Sen. Patrick Leahy (D-Vt.), would define the act of "phishing" as a federal crime. The bill would outlaw the act of spoofing a Web site in an attempt to "induce, request, ask or solicit any person to transmit, submit or provide any means of identification to another."

The bill also prohibits the creation of e-mail that represents itself to be from a legitimate business but attempts to induce the victim to divulge personal information with the intent to commit a crime of fraud or identity theft.

In phishing scams, victims receive e-mail that appears to come from a trusted source such as a bank. The e-mail requests personal information and typically includes a URL that appears to take the victim to the trusted source's Web site. That site actually is a spoofed site that collects personal information.

Phishing scams cost U.S. consumers and businesses up to $2 billion in the last year, according to Leahy. "Just imagine the concern we would all have about a series of bank robberies involving that much money," he said on the Senate floor. "In the long run, phishing undermines the Internet itself. If you can't trust where you are on the Web, you are less likely to use it for commerce and communications."

Leahy's bill protects free-speech rights by leaving Web site parodies out of the definition of phishing. The bill outlaws the act of spoofing a Web site for the specific criminal purpose of committing a crime of fraud or identity theft, but not other types of spoofing, according to Leahy's office.

Current laws allow law enforcement authorities to prosecute phishers, but only after someone has been defrauded, Leahy said in his statement. The new bill would allow charges to be made against phishers for attempting to deceive Internet users.

"This is a growing problem," Leahy noted. "Phishing is on the rise. And phishing attacks are increasingly sophisticated. Early phishing attacks were by novices, but there is evidence now that some attacks are backed by organized crime."

Copyright © 2004 IDG Communications, Inc.

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