“ Testing our Assumptions about ethics in Commerce: What does this cover?”

“Computer Ethics” in “Commerce” can include these areas:
(Adapted from http://courses.ncsu.edu:8020/classes-a/computer_ethics/commerce/)

Anticompetitive

- Antitrust (Microsoft example – finish up last lecture)
-Vaporware

Cybersquatting

Deceptive Advertising (search engines + digital manipulation)

Hacking into databases, web sites, networks, etc. (see Feb. 5 lecture + example of highjacking web sites)

Fraud (various areas)
- Auctions (retail sales online)
- “Nigerian letters”
- “pump and dump” stock schemes

Gambling
Spamming
Taxation
Term Papers ( “downloading your education”)

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Vapourware: software practice of announcing new products well in advance of market availability

- done to persuade competitors to stop their own R and D?
- can affect companies who are waiting for this delayed software vis a vis their own profitability.

Cybersquatting (= online extortion)
The act of registering a popular Internet address (for under 100$)—usually a company name—with the intent of selling it to its rightful owner (for lots of money).
- Compaq apparently had to pay 3.35 million for altavista.com

Deceptive Advertising Practices

1. Search Engines: s.e. companies have used advertising (banners) that don't affect search results
BUT some s.e. have adopted 2 practices which may affect results:
paid-placement
paid inclusion

one way this works: company buys a keyword, and then that guarantees that their website will be displayed (and can be at top of list)...often they don't tell the user that this is their policy....
(see Web of Deception, 2002. pp. 176-77)

2. Using Misleading or Erroneous Information

- example of 1999 New Year's Eve broadcast: CBS erased NBC's logo from the Times Square neon signs - digitally imposed its own logo on top.
Dan Rather (the trusted newscaster): "At the very least we should have pointed out to viewers that we were doing it. I did not grasp the possible ethical implication of this, and that was wrong on my part." (Web of Deception, p. 53)

Criminal hacking: including Highjacking Web sites:

- culprits copied 25 million web pages (including Harvard Law Review, etc.),
- the criminals inserted codes that lead users to their porn sites; once there the “back” and “exit” codes were disabled.

Purpose? Culprits charged high online advertising rates because of the number of hits. (Web of Deception, p. 65)

Fraud
FBI's definition of online fraud:

" any fraudulent scheme in which one or more components of the Internet, such as Web sites, chat rooms, and e-mail, play a significant role in offering nonexistent
goods or services to consumers, communicating false or fraudulent representations about the schemes to consumers, or transmitting victims' funds, access devices, or other items of value to the control of the scheme's perpetrators (identity fraud)."

"… where fraud is concerned, the Internet is the growth area, and the underground economy it has created may be as robust as its legitimate twin." (Web of Deception, p.
114)

National Consumer's League top 5 kinds of fraud
(for 2001 both off and online)

1. Online auctions - 63%
2. General Merchandise sales - 11%
3. Nigerian Money offers - 9%
4. Internet access services - 3%
5. Information about adult services - 3%

online auction fraud - seems to be committed mostly by the seller:
- accepts money for goods he doesn't have OR
- goods delivered are not what was on offer
- seller could pay with stolen credit card, etc.

Market Manipulation Schemes
- stock trader sent out a false news release about the company's low earnings: Lucent Technology took a one-day hit
of 7.1 billion loss in market capitalization. (Web of Deception, p. 54)
- another variation: "pump and dump" inflate the value of the stocks and then dump them…(of course, not just done online!)

Identity Fraud
- someone gains information about you (credit card + SIN + birthdate + mother’s maiden name, etc.) that allows them to impersonate you and commit various crimes in your name: borrow money, get a job, buy a house==in essence take on your identity.

Can be done by “social engineering” requesting information directly from person ( see “The Social Engineering of Internet Fraud” at www.isoc.org/inet99/proceedings/3g/3g_2.htm)
OR
By no involvement of victim: searching dumpsters, hacking into records, etc.

The Nigerian Letter: claims money needs to be sent out of country--send it to your bank account (once you give that info to them, they clean out your account).

How to prevent?
1. don’t judge by initial appearances.
2. be careful about giving our valuable personal information
3. be especially careful about online communications with someone who conceals his true identity.
4. watch out for “advance-fee demands”