About Cyber Crime

What is Cyber Crime

Cyber crime has a number of definitions that not only includes crime perpetrated over the Internet but also includes any crime in which a piece of computer-based technology is used. From spam to indentity theft, online crimes target the full spectrum of society, including youth, bankers, executives and senior citizens. The more widely recognized examples include:

• Exploitation of Children – Internet child pornography has become a $2.6 billion industry. The latest RCMP estimates indicate there are 60,000 identified IP addresses in Canada accessing child pornography. The National Center for Missing and Exploited Children documented that 85 children were reported missing every hour, totaling more than 750,000 missing during a year. Many cases involved luring schemes facilitated online.
• Identity Crime – An identity theft may involve impersonating a victim to gain access to existing bank accounts, take out bank loans or for other fraudulent purposes.
• Securities Manipulation – False information is widely disseminated across forums and news groups to cause a temporary spike in the trading price of a security from which the manipulator can reap guaranteed profits and cause startling losses to innocent market participants.
• Spam – Spam is any bulk commercial e-mail sent without the consent of the recipients.
• Threats to Critical Infrastructure – It’s estimated that the next threat to national security will either be the disruption of electronic commerce or the creation of an emergency situation.

What’s the Risk

Coordinated efforts, from foreign sources, can threaten various Canadian utilities including defence, telecommunications, pipelines and electrical networks. By exploiting security weaknesses in critical systems, criminals can gain access to these control systems.

Alternatively, hundreds of thousands of compromised personal and business computers can be directed, through denial of service (DoS) attacks, to overwhelm critical data networks. Through DoS attacks, many targets are at risk including mail servers, web servers and network routers. This type of equipment is used, on a daily basis, by business and denial of service attacks can have a serious impact on the economy and, ultimately, consumers.

Although the Canadian government and affiliated organizations have made strides in addressing certain areas of high tech crime, there has yet to be a coordinated effort to collectively investigate and prevent crimes online.

In addition, the threat faced by Canadians from high tech criminals continues to increase in effort and success. With most police services overwhelmed by staffing shortages, budget constraints and work volume, there is little availability for police agencies to engage in strategic, tactical solutions.

Criminals, on the other hand, are the first to develop new ways to expand their criminal empires. Without a comprehensive, united effort, the advantage in the fight against tech crime will remain with the criminals.

Economic Impact

The total economic cost associated with high-tech crime in Canada (or affecting Canadians abroad) is largely unknown. Canada currently does not have a uniform method of collecting statistical data on this new category of criminal activity in either the private or public sector but figures from a variety of sources indicate that the magnitude of the problem is astounding.

• Hacking, Internet fraud, denial of service attacks and high-tech mischief are estimated to cost the world economy more than $1 trillion dollars (US) a year in loss of business revenue and damage to computer equipment and data.
• The Canadian Anti-Fraud Centre reported 7778 cases of identity theft in 2006, resulting in millions of dollars in damages.
• The Canadian Council of Better Business Bureaus has estimated that identity theft may cost Canadian consumers, banks, credit card firms, stores and other businesses more than $2 billion annually.
• 2007 research from the U.S. Cyber Consequences Unit shows that the destruction from a single wave of cyber attacks on critical infrastructures could exceed $700 billion (US) – the equivalent of 50 major hurricanes hitting the U.S. soil at once.

The growth of electronic commerce and the use of the Internet by particularly vulnerable demographic groups such as children and seniors is believed to have accelerated the growth rates of tech crimes in the last few years. There is little reason to expect this rampant growth to slow without a concerted policing, legislative and research effort to rein in high tech criminals and their secretive networks.

Innovative, collaborative responses must be developed to thwart this new breed of sophisticated, savvy criminal. These criminals use world connectivity to thrive in a virtually lawless underworld where they launch malicious cyber activity against individuals, businesses and, in some cases, entire countries.

Cyber Crime Snapshots

ID Theft

Mr. AD, a victim living in Calgary, has spent a lot of time recently, talking to his creditors and the credit bureau. Early this year, his briefcase was stolen from his office and it contained a vast amount of personal information. "Everything that I used on a daily basis or on an occasional basis, who I am, my SIN card, drivers license, birth certificate was in my briefcase. Unfortunately by losing that, I had a tough time proving who I was to try and get it all back. However, it gave somebody full access to my identity." They used it to buy a car, a computer and furniture. They even took out a loan in his name and changed his address. It took a month before this fraud came to light.
– October 2003, Global TV, Calgary

Credit Card/Access Device Fraud

Nine people have been charged in Calgary for rigging drive-by ATM's to obtain financial information. The group allegedly used an electronic "skimmer" hidden behind a fake faceplate and card slot to record data from magnetic strips on ATM cards while a concealed camera provided PIN numbers. Police said they found data belonging to hundreds of potential victims on computers seized. They also found electronic equipment, debit cards manufactured using skimmed information and more than 1,000 blank cards. The group faces more than 50 charges with trial upcoming in the near future.
– November 2003, Calgary Herald

ID Theft to Support Other Crimes

Three people are facing more than 200 charges each after a home search found stolen AHC cards, stolen credit cards, stolen drivers licenses and forged insurance cards totaling more than 194 pieces of ID. Along with this discovery, the police seized computers, counterfeit bills in production stage, a sawed-off shotgun, $2,800 in methamphetamine and bogus cheques. Meth addicts pay for their drugs with white-collar crime such as ID fraud as there is no serious jail time. Bags full of identification is either sold or traded for meth.
– November 2003, Edmonton Journal

Benefit Fraud

A young secretary spent years trying to clear her name after a tax evader got a hold of her SIN card, which the secretary had never received. The thief used the secretary's name and SIN to move from job to job and collect unemployment insurance, health benefits, and maternity benefits – all without paying any taxes. The secretary was constantly harassed by the government to settle her unpaid income taxes. Revenue Canada even garnisheed her bank account and earnings. The victim had to travel to each of the thief's six former employers, pleading for written statements to prove to tax officials that she herself had never worked there.
– November 1992, The Gazette, Montreal