California's Department of Industrial Relations says it's revamping its database after NBC station KNTV of San Francisco reported over the weekend that hundreds of elevators in the Bay Area are running on expired inspection permits.
The region has only 26 inspectors to inspect about 32,000 elevators every year, the station reported after sifting through the database. More than 20 are in BART facilities alone.
The breakdown comes in scheduling. While the law says the state is supposed to inspect all of the elevators annually, inspectors can't actually start the process until the property owner takes the initiative to schedule the inspection. And once — if at all — that happens, it can be months before the inspections actually take place because of the shortage of inspectors.
The Industrial Relations Department says it hopes to have a fix in place by the end of the year.
By Robert Windrem NBC News Investigative Producer for Special Projects
Senior U.S. officials say they cannot yet ascribe responsibility for Friday's attack on the government building in Oslo.
"What you see is what we know," said a senior administration official, who like the others spoke on condition of anonymity.
However, they and others point to several possible connections that could lead officials to consider whether al-Qaida is behind the attacks.
Norwegian special forces have been fighting in Afghanistan for many years and Ayman al Zawahiri, al-Qaida's new leader after the death of Osama bin Laden, has been threatening Norway since 2003, warning that its participation in the U.S.-led military campaign against radical Islam in Afghanistan would result in an attack on the Norwegian homeland. Norwegian special forces operate in central Afghanistan, near Kabul.
On July 9, 2010, three Norwegians were indicted for planning an attack on targets in Oslo, apparently Chinese targets. Two of the three, a Uighur (Chinese Muslim) and an Uzbeki, were arrested in Norway, while a third, an Iraqi with Norwegian residence, was grabbed in Germany. The detentions were coordinated with arrest in New York of Najibulla Zazi, an Afghan-American man who wanted to blow up New York City subways. The two plots were believed to have been put together by al-Qaida’s central command in Pakistan -- Osama Bin Laden and Zawahiri.
Last week, Mullah Krekhar, founder of Ansar al Islam (the first Iraqi group affiliated with al-Qaida), was indicted in Oslo for threatening Norwegian government officials with death if he were to be deported. Krekhar took refuge in Oslo in early part of the last decade and has been seeking asylum. In comments to various news media, he threatened attacks if he was sent abroad, mainly on opposition figures who have long called for his extradition to the U.S.
In January 2006, the Norwegian government apologized to Muslims worldwide after the publication of 12 cartoons depicting the prophet Muhammad in the Norwegian newspaper Magazinet
By focusing on the situation in Prince George County in Maryland, they were able to cobble together a compelling narrative with solid statistics and real-world anecdotes, something that would have been difficult and time consuming if they had attempted it on a national scope.
And is there any reason to think the situation with foreclosure mediation is markedly better in, say, Nevada or Michigan?
Ron Jeremy is one of more than a dozen adult video stars who talked about the damage piracy can cause in public service announcements published last year by the Free Speech Coalition, the industry's trade association.
It's not fun, but all things considered, John Steele is OK with being a villain.
In recent months, Steele's Chicago law firm has filed almost 100 federal lawsuits seeking to identify thousands of "John Does" who downloaded pornographic videos in violation of their producers' copyright. Federal court records indicate that none of Steele's cases — in fact, no case of this type ever — has ended with a verdict at trial.
Sometimes, the cases run into roadblocks from skeptical judges over jurisdiction or whether the defendants have been appropriately identified. Others end in settlements for a few thousand dollars from defendants who are relieved that they get to remain anonymous.
Internet privacy advocates and technology writers call Steele a "copyright troll" and accuse his firm of scouring the Internet to track down computers that download pornographic videos, then forcing Internet service providers to identify the computer owners so it can shame those people into writing settlement checks.
The incentive to settle is to keep from being named forever in court records as a porno fiend, which "seems to me like it's a good way to make an easy buck," said Julie Samuels, a staff attorney for the Electronic Frontier Foundation, nonprofit advocate for what it calls "freedoms in the networked world."
"These plaintiffs are out to get a quick settlement," she said, because they know defendants — even those who have been wrongly identified — are eager to remain anonymous.
If you look at it as a matter of law, a lot of that is right, said Steele, who's fine with being called names as long as it doesn't cross the line into accusations of malfeasance.
Yes, Steele's firm goes looking for pornographic videos being accessed without permission — the firm developed its own tracking software "to make sure it's done right," he said.
Yes, the goal is to bring in money for pornographers — a letter from Steele's firm explicitly urges defendants to seize the "opportunity to avoid litigation by working out a settlement with us." One of the letters, a copy of which Steele verified, suggests writing a $2,900 check to the firm at its Chicago address.
And yes, one of the goals is to "scare people," he said — not primarily into writing checks, but to stop them from "stealing our clients' content."
That's not a bad thing, Steele said, because piracy today is so easy that "the industry's really on its knees right now."
(The economics of the pornography business are notoriously hard to nail down, but the industry commonly claims that illegal downloads have wiped out as much as 90 percent of producers' income since the advent of videocassettes made porn easy to watch in the privacy of the home.)
Lots of people may think his firm's methods are unfair, but adult entertainment companies are legal businesses with valid claims, and "we believe it's completely ethical and important to recover more money than the cost of the litigation," Steele said.
And as for his critics, he accepted that "you can't control what people say."
"If we were doing anything unethical, after 95 cases I can assure you I wouldn't have a law license," he said.
Studios have strong piracy case Steele's opponents agree with him when he says that most of the anonymous defendants probably did break the law and that adult entertainment producers have a right to protect their interests in court.
Even as he criticized the methods of lawyers like Steele, Adam E. Urbanczyk, an attorney with Saper Law of Chicago — which defends John Does sued by adult studios — stressed that "it's almost incomprehensible the amount of material that's getting ripped off."
And Samuels, of the Electronic Frontier Foundation, said it's "absolutely not the position of EFF that the industry should not be able to sue."
The distaste is with how the suits are filed. And this is where things get pretty technical.
The shorthand description of what plaintiffs' firms like Steele Hansmeier do is scour P2P networks to identify IP addresses that are downloading copyrighted material.
In non-tech, that translates to looking for videos that are being distributed across decentralized peer-to-peer (hence, P2P) file-sharing networks called "torrent sites." Then, using geotracking technology (like the GPS in your car or on your smartphone), investigators harvest the numeric Internet protocol addresses of the computers that are retrieving and sharing them.
That requires sophisticated programming, because the computers linked into the torrent "swarm" go on and offline from second to second — and when they're plugged in, their IP addresses can also change second by second.
Similar cases have sought the addresses of computers that retrieve videos from upload pirated video to so-called tube sites, which are underground YouTube-like operations that stream X-rated videos without permission.
In both instances, the lawsuits are meant to attach real people to the IP addresses. A dozen to a couple of hundred of them are then lumped together in a single lawsuit; this month alone, Steele Hansmeier has filed at least seven such suits seeking the identities of almost 700 John Does in California and Illinois, federal dockets show.
Urbanczyk likened that strategy to "throwing your lure out there" to see what you might catch.
"I wouldn't say bringing these cases is a scam because the claims are absolutely valid," Urbanczyk said. But "the whole situation reeks" because there are better remedies for copyright infringement, he said.
Targeting the pirates, not their customers When mainstream music and movie studios pursued copyright suits against individual users a few years ago, the public backlash was severe. Only a handful of such cases are still being pursued, most notably involving downloads of the Academy Award-winning movie "The Hurt Locker."
But pornography is different, because "we're an industry that people may think is morally questionable, that we may deserve it," said Dominic Ford, a gay adult video performer who operates Porn Guardian, a company that tracks copyrighted material and helps producers pursue video pirates.
Some porn producers prefer Ford's approach: going after the pirates themselves, something other producers and intellectual property experts say is extremely difficult.
Porn Guardian LLC
Services like Porn Guardian, run by adult video performer Dominic Ford, try to attack piracy fro the supply end — the pirates.
Many use Ford's Porn Guardian service, a version of which he offers free to smaller producers. The service helps producers safeguard their material by digitally watermarking it on the front end, gathering evidence of illegal downloading in real time and packaging that evidence for attorneys to file takedown notices against download sites under the Digital Millennium Copyright Act of 1996.
A driving force behind pirate-focused campaigns is a studio called Pink Visual of Van Nuys, Calif., whose president, Allison Vivas, has convened two industry gatherings bringing together producers, performers, distributors and intellectual property experts. Their goal is to develop a "collaborative anti-piracy stratregy" across the industry, said Jessica Pena, the company's corporate counsel.
"This isn't just about lawsuits," said Quentin Boyer, a spokesman for the company.
Boyer said Pink Visual was also putting the final touches on a new way to deliver copyrighted video online called PV Locker, which is designed to prevent piracy at the source. Now in beta, it allows subscribers to pay for whatever they want on demand, but it's available only inside the site. If it works the way Pink Visual intends, pirates can't download the video in the first place.
That's the real key to stopping losses, said Ford, who — using an analogy commonly repeated in interviews with executives of several companies — said cleaning up files on the Internet after they've already been downloaded is "just playing Whack-a-Mole."
"It's not about the 300 people who were illegally downloading it," Ford said, especially because "there's been some bad publicity when lawyers are going after these John Does (who) end up being a 70-year-old grandmother who didn't know the kids next door were feeding off their Wi-Fi."
Could 'false positives' help teach a lesson? Steele acknowledges the "false positives" — industry shorthand for otherwise innocent but technologically naive defendants who don't protect their home networks, leaving them open for anyone to use. Their defense is usually that they had no idea someone else — their teenage son or the college kid next door, for example — was downloading porn over their networks.
Experts disagree whether that's a valid defense, and anyway, it's "a huge P.R. problem," Steele said.
Another P.R. problem is the public perception that lawyers like Steele invade individuals' privacy by sneaking into their computers for a look around. That's not true, Steele said — that really "would be an invasion of privacy."
Instead, Steele Hansmeier's software joins the torrent swarm and monitors traffic to and from ISPs to users' Internet routers, he said.
"There are no entrapment issues because ... we're sitting right outside," much like investigators who legally go through trash bins on the sidewalk, he said. If someone else is piggybacking on your network, the solution is simple: Password-protect it. The hope, he said, is that eventually "people are no longer going to leave their wireless networks open."
Until that happens, Steele said, he really has no choice but to go after home users because pursuing pirates is unlikely to be effective in the long run.
"Why do we sue the end user? Because there's no one else in the piracy chain," he said. The nature of torrent sites — most of which are hosted outside the United States anyway — means "there's absolutely no company we can go after."
"We can't go after middlemen because there aren't any middlemen," he said.
'Piracy starts at a very known place' Pink Visual, with its "content protection retreats," and Dominic Ford, with his nearly 300 Porn Guardian clients, suggest that Steele may be skipping a step: working with them to choke the torrent sites' supply.
"Piracy starts at a very known place: my website," Ford said. "Someone is starting at our website and downloading that content. Those hundreds of copies are all exact duplicates of one file that was downloaded from one site."
The idea is that by targeting that initial downloader, you should be able to intercept the video before it even makes it to a torrent site. Ford's company says 98 percent of the takedown notices it generates are successful.
Often, those downloaders aren't really pirates, he said; they're just people who've been confused by the dominant culture of the Web.
Such people aren't criminals, he said; they just don't make the connection between product and producer.
"There's a common perception in America and perhaps the world that porn companies are all huge and unbelievably wealthy, that because we make movies and the mainstream (movie industry) makes movies, we're as big as they are," he said.
Most porn studios are "mom-and-pop operations like mine, or pop-and-pop, if you will," he said. "They're not these juggernaut companies where a little bit of piracy is not going to affect them."
That's the core conflict, said Urbanczyk, the Chicago lawyer who represents defendants in John Doe cases.
It may be true that "information wants to be free," he said. "But entertainment does not want to be free."
A lawsuit in Florida has cracked open a rare window into the cloistered world of high-level war contracting, as a billionaire oilman defends himself against allegations that his company paid off Jordanian government officials to control supply lines of fuel to U.S. forces in Iraq.
The controversial businessman at the center of the trial that began last week in Palm Beach is Harry Sargeant III, a retired Top Gun pilot and former GOP fundraiser who is denying the lawsuit’s claim that an ex-CIA agent working at his oil company wired a $9 million bribe to the head of Jordan’s intelligence agency in 2007.
Mohammad al-Saleh, the plaintiff in the case first reported by NBC News in May 2008, is a member of Jordan’s royal family. He claims that the payment was a kickback that helped Sargeant perpetuate a monopoly on shipping fuel though Jordan to U.S. bases in neighboring Iraq.
The existence of the monopoly was confirmed by a congressional investigation in 2008 that accused Sargeant’s energy business, the International Oil Trading Co. (IOTC), of gouging the Pentagon in what it called the “worst form of war profiteering.” A Pentagon audit found this year that IOTC was overpaid by as much as $200 million on fuel contracts dating from 2005. The company, however, insists it was underpaid and has sued the U.S. government for $75 million.
The $9 million wire to the Jordanian government has become a focal point in the high-stakes civil trial, in which al-Saleh is seeking $53 million in profits from the Pentagon contracts that he claims were wrongfully denied him when he was unceremoniously dumped as a one-third partner in IOTC by Sargeant and another defendant. Sargeant's counsel has not disputed that al-Saleh was removed from the company, but argues that he was forced out by the Jordanian government without the oilman’s approval.
Circuit CourtJudge Robin Rosenberg, however, has forbidden any mention in court of Sargeant's claim that Jordan’s King Abdullah II, who is al-Saleh's brother-in-law, personally ordered his ouster, or any reference to the wire as a “bribe” – at least until closing statements.
But what happened to the $9 million wire payment remains a mystery.
Sargeant, an imposing figurewith swept-back gray hair who has appeared by turns jocular and nervous during proceedings, testified last week that he wasn’t sure where the $9 million ended up and “didn't ask.” But he denied that it “directly or indirectly” benefited the Jordanian government.
On Thursday, IOTC official Marty Martin, who headed the CIA unit formed to hunt Osama bin Laden during the Bush administration before joining Sargeant’s company in 2007, took the stand to face questions about his role in sending the wire payment. Asked what ultimately happened to the $9 million by a plaintiff attorney, Martin elicited gasps from the courtroom audience when he responded, “I don’t know.”
Internal company correspondence unveiled in court allegedly shows that IOTC endeavored to disqualify competitors from winning the Pentagon fuel contracts, an effort that al-Saleh has linked to the $9 million payment.
To win the contracts, companies had to present the Pentagon with a so-called “letter of authorization” from the Jordanian government that allowed its holder to send fuel-truck convoys through Jordanian territory to U.S. bases in Iraq.
In August 2007, IOTC's contract lawyer, Ron Uscher, advised Sargeant, Martin and other company officials in an email that IOTC would gain an effective monopoly on the fuel contracts and thereby render the bidding process a formality if it managed to be the only company with the letter of authorization.
“Procurement becomes a sole source favoring IOTC,” he wrote. “Others can bid, but without the (letter of authorization), they cannot legally perform the contract in Jordan.”
Uscher then asked for ideas on how to “ensure that IOTC alone has the (letter of authorization).”
Two months later, in October 2007, Martin sent a letter to a representative of the Jordanian spy agency, the General Intelligence Directorate (GID), with which he had formed a close relationship through his covert CIA work in the Middle East. Admitting that the request “may sound self-serving,” he asked for assurances that the Jordanian government would grant no letters of authorization to bidders other than IOTC on “current or future” tenders of Pentagon fuel contracts, and that it would make that intention clear to Washington.
A month later, Martin wired the $9 million. Emails to the same GID representative show that Martin deposited the money in a government account “designated” for the head of the GID – the Jordanian equivalent of the CIA director.
“We are ready for immediate transfer for Basha (the head of the GID),” Martin wrote on Nov. 7, 2007. “In addition to the bank details, we need a name on the account. After 9/11, much harder for numbered account from U.S. banks. :)"
In 2009, according to testimony, IOTC bid on another massive fuel contract and told the U.S. government that it retained its letter of authorization. It won the contract.
Martin insisted that there was no connection between the wire and IOTC's request that the Jordanian government deny letters of authorization to rivals. He and Sargeant testified that the $9 million was supposed to be passed from the government account to the Taurus Trading Co., a firm that worked for IOTC on the ground in Jordan.
But why would a payment to the Taurus Trading Co. be made through a government account, and not sent to the company directly? Asked this question in April by msnbc.com, two of Sargeant’s lawyers, Roger Kobert and Mark Tuohey, replied that Taurus was a “quasi-government entity." Pressed last week during a court recess, however, Kobert admitted that he “may have misspoken.”
“I believe Taurus Trading Company is privately owned,” he said, adding that the money was wired to Taurus through the GID “on the Jordanian government’s request.”
In court on Tuesday, Kobert presented a spreadsheet that purportedly shows payments to Taurus beginning in November 2007 with the $9 million wire.
But IOTC’s chief financial officer, Kevin Kirkeide, testified that the $9 million was the only payment wired to the Jordanian government account. All subsequent payments, totaling nearly $50 million, went to Taurus directly. A company email introduced as evidenceshows that IOTC notified Jordanian intelligence of those subsequent payments.
Speaking to msnbc.comoutside court, Kobert said that IOTC never signed a contract or any written agreement with Taurus, despite having paid it tens of millions of dollars in exchange for purported ground services.
Kobert explained that Taurus was brought in by the Jordanian king and the GID to replace al-Saleh as a “profit-sharing partner” with IOTC. Al-Saleh’s side argued that Taurus was not a legitimate subcontractor: Plaintiff attorney Barry Ostrager alleged during a sidebar with the judge that it "did nothing" but serve as “a vehicle for corrupt payments.”
According to its website, Taurus is a “wholly owned subsidiary” of a larger company, the Commercial and Industrial Co., which has a storied past: In 1969, the British government secretly hired the company to promote arms sales in Jordan because it was believed to be “hand in glove” with the country’s royal family.
The Guardian newspaper, which unearthed the arrangement in 2007, reported based on declassified documents that the company was paid commissions for arms sales that its owner did not “materially assist.” For Sargeant, the civil trial may not be his biggest concern.
As msnbc.com reported last month, the oilman is allegedly facing a Justice Department investigation and could be criminally prosecuted under the Foreign Corrupt Practices Act, which prohibits overseas pay-offs.
By Robert Windrem NBC News Investigative Producer for Special Projects
When a "foreign intelligence service” hacked into the computers of a major defense contractor in March and made off with more than 24,000 Defense Department files, the subsequent report in the New York Times understandably focused on the size of the haul.
A less-obvious but important aspect of the break-in, first reported late Thursday, is what it says about the U.S. intelligence community's increasing ability to distinguish between computer attacks by bored teenage hackers and those launched by sophisticated foreign spy agencies, according to a cyber-espionage expert.
"In general, cyber-attacks carried out by foreign intelligence services are currently easy to distinguish from the work of other groups, because of the scale of effort, the level of capabilities and the nature of the targets," Scott Borg, director of the independent U.S. Cyber Consequences Unit, wrote Friday in an email interview. "Other groups, such as criminal enterprises and ideological militants are not, for the most part, up to mounting these sorts of attacks and wouldn't have reason to commit the necessary resources."
That was not always the case, writes Borg, whose nonprofit advises countries -- including the United States and the European Union -- and major corporations on cyber security.
"We are now past the day when the Department of Defense could mistake an attack by three teenagers for a major effort by a foreign power, as they did with Solar Sunrise in 1998," he explained, referring to an attack on multiple Defense Department computers worldwide, later determined to have been carried out by two teenagers from California and one from Israel.
The attack on the Pentagon contractor reported by the Times, on the other hand, required resources that "only nation-state-backed cyber attack forces currently possess," he said, while allowing that either independent hackers or organized crime groups could eventually develop such capabilities.
The ultimate value in being able to categorize cyber-attacks in a timely manner is being able to determine who carried them out and why, which would in turn help determine how to respond.
Borg's group knows about foreign intelligence services’ abilities to carry out cyber-attacks.
In 2008, he and the US-CCU tracked how the Russian military, mainly using organized crime groups, mounted a "cyber-campaign" that coincided with the Russian invasion of Georgia. The campaign first targeted Georgian media, then government sites -- including the office of the Georgian president -- business associations, educational institutions and the power grid, threatening to cause permanent damage to the country's infrastructure, the CCU reported. When the military campaign ended, so did the cyber-campaign, Borg noted.
Indeed, one of the leading suspects in the March attack is the Russian foreign intelligence service, according to U.S. officials.
By Mike Brunker, Investigations Editor, NBC NewsNBCNews.com
While numerous U.S. officials have said violence along the U.S.-Mexico border fueled by drug trafficking poses an increasing threat to Americans, a review of data from more than 1,600 local and federal law enforcement agencies from California to Texas indicates that the violent crime has been declining for years.
USA Today reported in Thursday's editions that a review of more than a decade of crime data for border communities in the four states that abut Mexico – California, Arizona, New Mexico and Texas -- indicated that violent crime rates have been declining for years – even before the current U.S. security buildup began. The newspaper also found that U.S. border cities were statistically safer on average than other cities in their respective states, and had maintained lower crime rates than the rest of the nation.
Numerous elected and law enforcement officials along the U.S. border have maintained that violence associated with Mexican drug cartels, which has claimed at least 30,000 lives south of the border, is increasingly creeping into the U.S.
Most notably, Arizona Gov. Jan Brewer said in April 2010 that border violence has gotten so bad there have been beheadings out in the Arizona desert – a statement she was later forced to recant.
And Texas Rep. Michael McCaul said during a recent congressional hearing. "It is not secure and it has never been more violent or dangerous than it is today. Anyone who lives down there will tell you that."
Other news reports focusing on specific cities or communities have anecdotally challenged those assertions, but the USA Today analysis is believed to be the first comprehensive review of the crime data along the entire U.S.-Mexico border.
Reporters Alan Gomez, Jack Gillum and Kevin Johnson spent four months reporting the story.
NBC senior investigative correspondent Lisa Myers reports that many third-party companies are burying hidden charges on phone bills -- a practice called "cramming" -- and major phone providers are allowing it to happen.
By Bob Sullivan, Columnist, NBC News
Mysterious fees and services crammed onto phone bills are a “nationwide epidemic” for U.S. consumers, but a reliable source of revenue for some of America's biggest telecommunications companies, a year-long congressional investigation has found.
A report issued Wednesday by Sen. John Rockefeller, D-W.Va., says that three firms -- Verizon, AT&T and CenturyLink/Quest -- earned $650 million as their cut of cramming charges levied by third-parties since 2006.
Cramming charges -- such as unwanted $10-per-month voicemail or Web design services -- have been frustrating phone customers for more than 15 years, thanks in part to ill-considered rules designed to enhance competition in local phone markets. Consumers often don't spot the small monthly fees, but even when they do getting refunds can be a nightmare: The telephone provider that sends the bills often refuses to issue refunds, instead referring consumers to the third-party firms, which are often unresponsive. The Federal Communications Commission estimates that 15 million to 20 million consumers are crammed every year. Rockefeller’s report says cramming could cost U.S. consumers $2 billion annually.
Congress has been unable to fix the problem for more than a decade.
"I think it's embarrassing for the Congress ... but they're big companies. They don't have to make money that way," Rockefeller told NBC News in advance of a hearing on cramming Wednesday. "I think it's reprehensible and … shameful behavior. And don't tell me they don't know about it. They have to know about it."
Crammers are so bold that they have jammed unauthorized charges onto dead people's phone bills, government agencies' telephone lines -- even onto lines owned by AT&T.
"Committee staff has found hundreds of egregious examples of cramming," the report said. "Third-party vendors have enrolled deceased persons in their so-called services and charged family members' telephone bills for it. They have charged telephone lines dedicated to fire alarms, security systems, bank vaults, elevators and 911 systems. Senior citizens' telephones have been enrolled in web-hosting services, even though they have never used. A children‘s hospital was charged for a celebrity tracker e-mail service that provided daily celebrity news feeds, photos, and videos. A national bank‘s telephone lines were charged for credit protection plans."
Perhaps nothing illustrates how out of control cramming has become as well as AT&T's own victimization.
"Committee staff confirmed that third-party vendors associated with one hub company crammed at least 80 of AT&T‘s own telephone lines with charges for services such as voicemail, sometimes for periods as long as 18 months," the report said.
During the hearing by the Senate Commerce Committee, Rockefeller called on Congress to take action against what he called "a scam that has cost telephone customers billions of dollars."
"It’s time for us to take a new look at this problem and find a way to solve it once and for all," he said. "We’ve let the crammers get away with these abuses for far too long. There’s also a cost of cramming that is harder to put a dollar figure on – the countless frustrating hours that families and businesses spend trying to get these charges taken off their phone bills."
Cramming complaints have piled into state consumer offices, the Federal Trade Commission and the FCC since at least 1995, but neither Congress nor the phone companies that collect the money have been able to slow the problem or find the companies behind it.
NBC's Lisa Myers did, however. In an investigative report that aired Wednesday on TODAY, Myers located one company that acts as a clearinghouse for cramming; tracked down dozens of other firms that hide behind the same P.O. boxes; and found that hundreds of firms that have "D" of "F" ratings with the Better Business Bureau. Myers also had no trouble finding consumers hit with outlandish cramming charges on their phone bills: $14.95 for ID theft monitoring; $16 a month for a fax service; $40 a month for voicemail.
"Why are they in business? Probably because they're scamming and cramming and making money off of innocent people," Rockefeller said. "I'm shocked. I'm angry. I'm frustrated that nobody's been able to stop it."
The heat is getting turned up on cramming recently, however. On Tuesday, the FCC proposed new rules that would require more obvious disclosures by third parties on phone bills.
Illinois Attorney General Lisa Madigan wants to go much farther, however, and is calling for an outright ban on third-party billing on phone bills.
"Simply put, these deceptive and sometimes fraudulent solicitations for products that no one wants or agreed to buy have persisted for at least 15 years and show no signs of disappearing," she said. “It is time to put an end to third-party billing on telephone bills by banning them.”
Under current rules, providers are forced to give third-party firms the chance to market services like toll-free numbers or website hosting using the providers' equipment and billing services through an arrangement that has its origins in the original breakup of AT&T’s telephone monopoly. But it's too easy for third parties to attach unwanted items to consumers' bills -- previous investigations have found firms frequently trick consumers into signing up using sweepstakes entries or cashing small checks that also serve asauthorization forms. In other cases, the third-party firms simply lie about getting authorization, a scam called “phantom billing.”
While crammers collect billions of dollars, telecom firms get a percentage of each payment for passing along the charge. Rockefeller said that added up to $650 million for the three big firms in the last five years. Rockefeller’s report says Verizon, for example, collects $1 to $2 per charge.
“It's something the phone companies do know. And they can't not know it -- because -- it's bringing in a lot of money to them,” he said. And it’s bringing them a lot of complaints. The report says more than 500,000 customers have contacted AT&T, CenturyLink/Qwest, and Verizon to complain about cramming in the past five years.
The report also claims that phone companies put pressure on employees to grant shady third-parties access to consumers' accounts for billing purposes.
"Documents reviewed by the committee staff show that some telephone company employees feel financial pressure to approve third-party vendors even though the companies appear to be crammers," it says.
Both Verizon and CenturyLink told NBC News that they do not tolerate cramming, and that they carefully scrutinize outside companies and respond to complaints. Both declined on-camera interviews. AT&T had no comment.
Walter McCormick, CEO of U.S. Telecom Association, said at Wednesday's hearing that telephone firms have made strides while clamping down on bogus third-party charges, and said many consumers find third-party billing to be covenient. He tried to deflect accusations that telecommunication companies use cramming to bolster their bottom lines by saying that third-party billing revenues represent just "one-tenth of one percent" of telecom firm revenue. But he acknowledged that unauthorized charges are a "continuing problem."
"We pledge our industry's good faith and our committment to work with you," on solutions, he said.
Madigan said the first complaints about cramming showed up in her office in 1996. At the time, products such as prepaid calling cards, voice mail service, credit repair services, cell phone warranties, local singles matching services, Web page design, and toll-free numbers were most frequently crammed, she said. More recently, the scams have evolved to include credit repair, identity theft prevention and monitoring, business advice, online photo storage, roadside assistance, online yellow pages listings, and many other services.
They have a common denominator: Consumers pay for them, sometimes for years, but don't want them or use them.
"These low usage rates, less than 1 percent, indicate that consumers did not knowingly sign up for them," she said. "In one case I brought, the vendor had billed over 9,800 Illinois consumers for credit repair services. Although the credit repair services were designed for individuals, the billed consumers include a county coroner’s office, a Steak N Shake restaurant and a public library dial-a-story telephone line."
Many consumers don't understand that their telephone number can be used "just like a credit card," she said.
The deception has evolved since the arrival of the “Do Not Call” list in 2003, she said, with more consumers tricked into third-party telephone services via online Web pages.
Both Madigan and Rockefeller say that telecommunications industry groups, in response to an initial wave of complaints in the late 1990s, promised to clean up cramming through self-regulation -- and failed.
"They originally came up to us and said, 'Look, we understand this is a problem. We don't want to treat our consumers this way, so we want do it on a voluntary basis,” Rockefeller said. “Don't mandate us to do it because...' Then they made a very good case. Stupidly -- we went along with that."
RED TAPE WRESTLING TIPS
Rockefeller says he plans to introduce legislation that would make cramming explicitly illegal, but that kind of consumer protection is still in the future.
In the meantime, the best way for consumers to protect themselves is to call their local phone company and request that it shut off third-party billing services -- many will, for free. Consumers who've been crammed and scammed should call their local phone company and insist on a refund; they should also file a complaint with their state attorney general's office and the FTC. But most important: Scan those phone bills every month for surprise charges and unwanted services. They're easy to miss.
Read statements to NBC News from Verizon, CenturyLink and daData in response to the report about unauthorized charges appearing on phone customers’ bills, a practice called “cramming.”
The FBI plans to play a big role in a controversial immigration program that sifts through local police records to root out illegal immigrants, according to government documents obtained by opponents of the program.
The program, Secure Communities, gives Immigration and Customs Enforcement access to local police records and fingerprints when they are routed through the FBI's database. ICE then uses those records to determine whether someone in a local jail may be in the country illegally.
Publicly, the FBI is supposed to be a passive participant in Secure Communities, or S-Comm, automatically notifying ICE of potential immigration problems whenever one appears in a criminal record requested by a local police agency.
But the new documents — published this week by organizations that contend that S-Comm is a Big Brother weapon to round up and deport all illegal immigrants — describe the program in much broader, cross-agency terms:
Participation by local law enforcement is "inevitable because SC is only the first of a number of biometric interoperability systems being brought online by the FBI 'Next Generation Identification' (NGI) project," according to the key document — a joint FBI/ICE guide to building support for S-Comm. (NGI is the FBI's planned expansion of its fingerprint database to include other identifiers, such as facial recognition.)
S-Comm raised concerns in dozens of states and in Congress after msnbc.com reported last year that although federal authorities were consistently telling local law enforcement agencies that their participation was voluntary, internal ICE and DHS documents made it clear that the agencies always intended it to be a mandatory program.
The DHS inspector general's office opened an investigation in May into how S-Comm has been sold to local authorities.
Bridget Kessler, a lawyer for the Cardozo Law School Immigration Justice Clinic, one of the groups that obtained the documents under the Freedom of Information Act, said the records "provide a fascinating glimpse into the FBI's role in forcing S-Comm on states and localities. The FBI's desire to pave the way for the rest of the NGI project seems to have been a driving force in the policy decision to make S-Comm mandatory."
Many local leaders have sought to suspend their agencies' participation — including New York Gov. Andrew Cuomo last month — but ICE and DHS insist they don't have that prerogative.
In fact, the FBI/ICE guide states explicitly that local "non-participation" measures will have no effect on nationwide deployment of the program.
"Once interoperability is activated in that jurisdiction, the arrestees' fingerprints will in fact be checked against (immigration records) ... and forwarded to the appropriate DRO (Detention and Removal) Field Office for information and action as appropriate," it says.
The guide says it is intended to help federal authorities persuade a "resistant jurisdiction" to sign on to the program now, "instead of just flipping the switch in five years."
It lays out three strategies: "penetrate the jurisdiction" by enlisting all of its neighbor cities and counties in a "ring of interoperability" of enthusiastic municipalities around the reluctant location; bypass local police entirely by going straight to state prisons; and drive home the point that "non-participation does not equate to non-deployment."
Immigration advocates say the program encourages local law enforcement to round up suspected illegal immigrants on other charges so they will fall into the S-Comm net. At the same time, some law enforcement officials criticize the program as a de facto drafting of local resources to enforce federal laws.
Confirming years of warnings from government and private security experts, a top Homeland Security official has acknowledged that computer hardware and software is already being imported to the United States preloaded with spyware and security-sabotaging components.
The remarks by Greg Schaffer, the Department of Homeland Security's acting deputy undersecretary for national protection and programs, came Thursday during a tense exchange at a hearing of the House Oversight and Government Reform Committee. The panel is considering an Obama administration proposal to tighten monitoring and controls on computer equipment imported for critical government and communications infrastructure.
Schaffer didn't say whether the equipment he was talking about included end-user consumer tech like retail laptops, DVDs and media players. If so, his comments, first reported Friday morning by Fast Company, would be the first time the United States has publicly confirmed that foreign consumer technology is arriving in the country already loaded with nasty bugs like key-logging software, botnet components and even software designed to defeat security programs installed on the same machine.
DHS did not respond to requests to clarify Schaffer's remarks.
Schaffer made the statement under questioning from Rep. Jason Chaffetz, R-Utah, who noted that "the issue of software infrastructure (and) hardware built overseas with items embedded in them already by the time they get to the United States ... poses, obviously, security and intellectual property risks."
"A, is this happening, Mr. Schaffer? And, B, what are we going to do to fight back against this?" he asked.
Schaffer began his answer by stating how important the issue is to President Barack Obama. But Chaffetz cut him off and, at Schaffer's request, broadly restated the question to extend it beyond government infrastructure:
"Are you aware of any component software (or) hardware coming to the United States of America that already have security risks embedded into those components?"
Schaffer paused for about 10 seconds before replying:
"I am aware that there have been instances where that has happened."
You can watch the exchange here, beginning at 51:47:
The exchange between Rep. Jason Chaffetz and DHS Deputy Undersecretary Greg Schaffer begins at 51:47.
Ohio journalists are warning that the state is headed toward a "total eclipse" of the public's right to know what government officials are doing after Gov. John Kasich last week signed a measure that significantly limits civil penalties for destroying public documents.
The new law limits fines against a public agency to $10,000 per case and restricts attorney's fees to the same amount. There previously was no limit on damages.
The Columbus Dispatch reported that public agencies frequently reject requests for public records. It said the Kasich administration, for example, rejected its request for three e-mails related to the Ohio State University football scandal because it was "overly broad."
"Similar occurrences are increasing at all levels of Ohio government," the newspaper reported.
State Sen. Bill Seitz, a Republican from Cincinnati who co-sponsored the bill, said the measure was intended to stem abuse of records requests by parties who might request documents they knew didn't exist in hope of a big payday in court. He noted that criminal penalties for such destruction weren't affected.
The Blade of Toledo said Sunday there was "no evidence" of such abuse, reporting that "(s)ince the state's public-records law took effect in 1985, there have been only a few big judgments for official violations."
"It seems at least as likely that some government agencies would regard the meager financial penalties in the bill as an acceptable cost of keeping public business secret, and that some potential plaintiffs would be dissuaded from bringing valid lawsuits because they couldn't afford to pursue them," the newspaper said in an editorial.
The Dispatchagreed in an editorial Sunday that the measure is a big blow for open government:
"In the spirit of our nation celebrating its independence this July 4 weekend, maybe more public officials who believe in transparency could sponsor changes that would make more records open to taxpayers who pay the bills."
What do you think? Do public officials need more protection from records requests? Let us know in the comments.
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