AP on Crypto Hearing

[jya@pipeline.com (John Young)]

   7-25-96. The Associated Press: 
 
   Computer Codes May Aid Crime   
 
 
   Washington -- FBI Director Louis Freeh warned Congress on 
   Thursday that allowing uncontrolled export of U.S. computer 
   security codes may help international criminals and 
   terrorists hide their activities from law enforcement. 
 
 
   "Encryption products used unchecked by criminals and 
   terrorists for their illegal activities pose an extremely 
   serious and, I believe, unacceptable threat," Freeh told 
   the Senate Commerce, Science and Transportation Committee. 
 
 
   Legislation pending in the Senate would permit U.S. 
   companies to export high-tech encryption devices that 
   ensure greater privacy for computer files, electronic mail 
   messages and systems such as stock exchange transactions. 
 
   Sponsors said the bill would "help America maintain our 
   superiority in software development" and guard against 
   unwarranted government intrusion. 
 
 
   "It is irrelevant that we can make a better product if we 
   cannot sell it," said Sen. John Ashcroft, R-Mo., one of the 
   sponsors. 
 
 
   The Clinton administration has proposed that encryption 
   exports be allowed only if a decoding "key" for the devices 
   is left with a third party -- such as a bank or insurance 
   company -- so that law enforcement personnel with a court 
   order could break the code, if necessary. 
 
 
   Freeh said such an arrangement would safely open profitable 
   foreign markets for U.S. software companies. The Internet, 
   he said, "was never intended as a place without police 
   officers. We need cops there, as we do elsewhere, to 
   protect people, to guard their rights." 
 
  
   The encryption codes available today are so powerful, Freeh 
   said, that it would take the FBI more than a year to decode 
   a single message in some cases. Ramzi Yousef, on trial in 
   New York on charges of plotting to bomb a dozen U.S. 
   airliners, used a laptop computer containing files the FBI 
   still hasn't been able to decode, he added. 
 
 
   Sponsors and industry officials noted, however, that many 
   of these devices are already available abroad, and anyone 
   can download them free from the Internet. They can also be 
   sold within the United States at local computer stores. 
 
 
   "The criminal element the administration is trying to 
   prevent from obtaining this technology already has it," 
   said Roel Pieper, president of Tandem Computers Inc. "The 
   only ones who suffer as a result of this policy is the U.S. 
   industry." 
 
  
   Netscape Communications Corp. President Jim Barksdale 
   estimated his company will lose $40 million this year in 
   potential export sales for encryption products. 
 
 
   But a top official at the National Security Agency -- whose 
   job is to break secret codes -- said the encryption "genie 
   is not out of the bottle." NSA Deputy Director William 
   Crowell said encryption won't be widely used until it is 
   marketed and sold, with support to help people use it. 
 
 
   "The administration's proposal is not designed to keep the 
   plug in the bottle, but to help provide a full range of 
   trusted security services," Crowell said. 
 
 
   Industry executives also said use of the decoding keys 
   would be costly and raises questions about government 
   access to private business and personal information, such 
   as bank and medical records. 
 
 
   "Keys can be compromised in many ways. They can be stolen, 
   revealed by disgruntled employees or obtained through 
   bribery, Pieper said. 
 
 
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