National Conference of CIRC On

Corporate laws-
Ghaziabad , 20th & 21st Dec 2008

Cybercrimes and legal enforcement in

India…
Karnika Seth
Cyber-lawyer & IP Expert

Partner,
SETH ASSOCIATES
ADVOCATES AND LEGAL CONSULTANTS © copyrighted Seth Associates Dec 2008
Introduction to Cyber Crime

 Computer Crime, E-Crime, Hi-

Tech Crime or Electronic Crime
is where a computer is the target
of a crime or is the means adopted
to commit a crime.
 Most of these crimes are not new.
Criminals simply devise different
ways to undertake standard
criminal activities such as fraud,
theft, blackmail, forgery, and
embezzlement using the new
medium, often involving the
Internet
Computer vulnerability
 Computers store huge amounts of data in small spaces
 Ease of access
 Complexity of technology
 Human error
 One of the key elements that keeps most members of any society honest is fear of being caught
— the deterrence factor. Cyberspace changes two of those rules. First, it offers the criminal an
opportunity of attacking his victims from the remoteness of a different continent and secondly, the
results of the crime are not immediately apparent.
 Need new laws and upgraded technology to combat cyber crimes
Different Types of Cybercrimes

Cyber crimes
Web jacking

Denial of Trojan
Information E-mail Salami Service
Hacking attacks
Theft bombing attacks attacks
Types of Cyber crimes
 Credit card frauds
 Cyber pornography
 Sale of illegal articles-narcotics, weapons, Crime against Government
wildlife
 Online gambling
 Intellectual Property crimes- software
piracy, copyright infringement, trademarks
violations, theft of computer source code Crime against property
 Email spoofing
 Forgery
 Defamation
 Cyber stalking (section 509 IPC)
 Phising Crime against persons
 Cyber terrorism
 TYPES OF CYBER CRIMES
E-Mail bombing: Email bombing refers to sending a large amount of e-mails
to the victim resulting in interruption in the victims’ e-mail account or mail
servers.

Data diddling: This kind of an attack involves altering the raw data just before
it is processed by a computer and then changing it back after the processing
is completed.

Salami attacks: These attacks are used for the commission of financial
crimes. The key here is to make the alteration so insignificant that in a single
case it would go completely unnoticed e.g. A bank employee inserts a
program into bank’s servers, that deducts a small amount from the account of
every customer

Denial of Service: This involves flooding computer resources with more

requests than it can handle. This causes the resources to crash thereby
denying authorized users the service offered by the resources.
Some common cybercrimes…
 Phishing, the mass distribution of “spoofed” e-mail messages,
which appear to come from banks, insurance agencies, retailers or
credit card companies and are designed to fool recipients into divulging
personal data such as account names, passwords, or credit card
numbers.

 “Carding,” which entails using stolen credentials (and can include

package reshipping, money moving, and identity theft schemes)

 Compromised servers or “bots,” which may be launching cyber attacks

or sending Spam
Cyber Crime Data In Regional
Context
 Carding:-
Carding is a serious threat to India, as it
does not require a high degree of
sophistication and is considered
particularly pernicious by international
financial institutions and e-commerce
providers.
 Bots:-
Bots, compromised servers that may be
launching cyber attacks or sending Spam,
were detected in the India IP space,
including servers with the domain name.
 Phishing:-
ISPs were able to point to a few
examples of phishing capture sites being
located on their servers, one targeting
eBay (a frequent attack point for
phishers).
Computer Viruses
 Viruses

 A computer virus is a computer program that can infect other

computer programs by modifying them in such a way as to
include a (possibly evolved) copy of it. Note that a program
does not have to perform outright damage (such as deleting or
corrupting files) in order to be called a "virus".

 A computer virus is a program that can copy itself and infect a

computer without permission or knowledge of the user.
Why Do people Create These
Viruses?
 To distribute political message.

 To attack the products of specific companies.

 Some consider their creations to be works of art, and see as a

creative hobby.

 Financial gain from identity theft

Types of Viruses

Types of viruses

Armored virus Companion virus Polymorphic virus

Macro virus Boot sector virus Stealth virus

Logic bomb Sparse infector Network viruses

Cyber Threats
Cyber Threats

 Cyber threats to a control system refer to persons who attempt

unauthorised access to a control system device and network
using a data communications pathway.

 Main threats to cyber crime is Hacking.

Hacking involves gaining unauthorised access to a computer
and altering the system in such a way as to permit continued
access, along with changing the configuration, purpose, or
operation of the target machine, all without the knowledge or
approval of the systems owners.
New Internet Threats
 All computers need internet security
Home users can lose valuable personal data with one click to the wrong website. Children
trading games also exchange viruses unknowingly. You receive an email requesting an
update to your payment details, and a hacker gains access to your bank account. A
backdoor is installed on your machine, and your PC becomes a zombie, spewing out
spam.

 New technologies - new anti-malware solutions

As cyber threats have evolved, so has software to deflect such threats. Sophisticated
antispyware and antivirus solutions capable of detecting the most complex new viruses
are now available.
What Is Spam
 Spam is the equivalent of physical junk mail and unsolicited telemarketing phone calls. It
has become one of the largest nuisances to computer users for both home and business
users.

 There are two main types of spam, and they have different effects on Internet
users.Cancellable Usenet spam is a single message sent to 20 or more Usenet
newsgroups. (Through long experience, Usenet users have found that any message
posted to so many newsgroups is often not relevant to most or all of them.) Usenet spam
is aimed at "lurkers", people who read newsgroups but rarely or never post and give their
address away. Usenet spam robs users of the utility of the newsgroups by overwhelming
them with a barrage of advertising or other irrelevant posts. Furthermore, Usenet spam
subverts the ability of system administrators and owners to manage the topics they accept
on their systems.

 Email spam targets individual users with direct mail messages. Email spam lists are often
created by scanning Usenet postings, stealing Internet mailing lists, or searching the Web
for addresses. Email spams typically cost users money out-of-pocket to receive. Many
people - anyone with measured phone service - read or receive their mail while the meter
is running, so to speak. Spam costs them additional money. On top of that, it costs money
for ISPs and online services to transmit spam, and these costs are transmitted directly to
subscribers.
Frequency of incidents of Cyber
crimes in India
Denial of Service: Section 43
Virus: Section: 66, 43
Data Alteration: Sec. 66
U/A Access: Section 43
Email Abuse: Sec. 67,
500, Other IPC Sections
Data Theft: Sec 66, 65

Source: Survey conducted by ASCL

Frequency of reporting Cyber
crimes in India

 During the year 2005, 179 cases were registered

under IT Act as compared to 68 cases during 2004
21.2% cases reported from Karnataka, followed by
Maharashtra(26) , Tamil Nadu(22) and
Chhattisgarh and Rajasthan (18 each) out of 179
cases, 50% were related to Section 67 IT Act.,125
persons were arrested. 74 cases of hacking were
reported wherein 41 were arrested.
Combating cyber crimes
 Technological measures- Public
key cryptography, Digital
signatures ,Firewalls, honey pots
 Cyber investigation- Computer
forensics is the process of
identifying, preserving, analyzing
and presenting digital evidence in a
manner that is legally acceptable in
courts of law.
 These rules of evidence include
admissibility (in courts), authenticity
(relation to incident), completeness,
reliability and believability.
 Legal framework-laws &
enforcement
Combating Cyber crime-Indian legal
framework
 Information Technology Act, 2000-came into force on 17 October 2000.
Information technology Act 2000 consists of 94 sections segregated into 13
chapters. Four schedules form part of the Act.

 Extends to whole of India and also applies to any offence or contravention

there under committed outside India by any person {section 1 (2)} read with
Section 75- Act applies to offence or contravention committed outside India
by any person irrespective of his nationality, if such act involves a
computer, computer system or network located in India

 Section 2 (1) (a) –”Access” means gaining entry into ,instructing or

communicating with the logical, arithmetic or memory function resources of
a computer, computer resource or network

 IT Act confers legal recognition to electronic records and digital signatures

(section 4,5 of the IT Act,2000)
 Civil Wrongs under IT Act
 Chapter IX of IT Act, Section 43
 Whoever without permission of owner of the computer
 Secures access (mere U/A access)
 Not necessarily through a network

 Downloads, copies, extracts any data

 Introduces or causes to be introduced any viruses or
contaminant
 Damages or causes to be damaged any computer resource
 Destroy, alter, delete, add, modify or rearrange

 Change the format of a file

 Disrupts or causes disruption of any computer resource

 Preventing normal continuance of computer
Civil Wrongs under IT Act
(Contd.)
 Denies or causes denial of access by any means
 Denial of service attacks
 Assists any person to do any thing above
 Rogue Websites, Search Engines, Insiders providing
vulnerabilities
 Charges the services availed by a person to the account of
another person by tampering or manipulating any computer
resource
 Credit card frauds, Internet time thefts
 Liable to pay damages not exceeding Rs. One crore to the
affected party
 Investigation by
 ADJUDICATING OFFICER
 Powers of a civil court
 Data diddling: changing data
prior or during input into a
computer
 Section 66 and 43(d) of the I.T. Act covers the offence of data
diddling
 Penalty: Not exceeding Rs. 1 crore
Case in point :
NDMC Electricity Billing Fraud Case: A private contractor
who was to deal with receipt and accounting of electricity bills
by the NDMC, Delhi. Collection of money, computerized
accounting, record maintenance and remittance in his bank
who misappropriated huge amount of funds by manipulating
data files to show less receipt and bank remittance.
 Section 46 IT Act
 Section 46 of the IT Act states that an adjudicating officer
shall be adjudging whether a person has committed a
contravention of any of the provisions of the said Act, by holding
an inquiry. Principles of Audi alterum partum and natural justice
are enshrined in the said section which stipulates that a
reasonable opportunity of making a representation shall be
granted to the concerned person who is alleged to have
violated the provisions of the IT Act. The said Act stipulates that
the inquiry will be carried out in the manner as prescribed by the
Central Government

 All proceedings before him are deemed to be judicial proceedings,

every Adjudicating Officer has all powers conferred on civil courts

 Appeal to cyber Appellate Tribunal- from decision of Controller,

Adjudicating Officer {section 57 IT act}
 Section 47, IT Act
 Section 47 of the Act lays down that while adjudging the
quantum of compensation under this Act, the adjudicating
officer shall have due regard to the following factors, namely-

 (a) the amount of gain of unfair advantage, wherever

quantifiable, made as a result of the default;

 (b) the amount of loss caused to any person as a result of the

default;

 (c) the repetitive nature of the default

 Cybercrime provisions
under IT Act,2000

Offence Relevant Section

under IT Act

Tampering with Computer source documents Sec.65

Hacking with Computer systems, Data alteration Sec.66
Publishing obscene information Sec.67
Un-authorized access to protected system Sec.70

Breach of Confidentiality and Privacy Sec.72

Publishing false digital signature certificates Sec.73
Section 65: Source Code

 Most important asset of software companies

 “Computer Source Code" means the listing of
programmes, computer commands, design and layout
 Ingredients
 Knowledge or intention
 Concealment, destruction, alteration
 computer source code required to be kept or
maintained by law
 Punishment
 imprisonment up to three years and / or
 fine up to Rs. 2 lakh
 Section 66: Hacking
• Ingredients
Intention or Knowledge to cause wrongful loss
–
or damage to the public or any person
– Destruction, deletion, alteration, diminishing
value or utility or injuriously affecting
information residing in a computer resource

• Punishment
– imprisonment up to three years, and / or
– fine up to Rs. 2 lakh
• Cognizable, Non Bailable,
Section 66 covers data theft aswell as data alteration
 Sec. 67. Pornography
 Ingredients
 Publishing or transmitting or causing to be published
 in the electronic form,
 Obscene material
 Punishment
 On first conviction
 imprisonment of either description up to five years and

 fine up to Rs. 1 lakh

 On subsequent conviction
 imprisonment of either description up to ten years and

 fine up to Rs. 2 lakh

 Section covers
 Internet Service Providers,
 Search engines,
 Pornographic websites
 Cognizable, Non-Bailable, JMIC/ Court of Sessions
Computer Related Crimes under IPC and
Special Laws

Sending threatening messages by email Sec 503 IPC

Sending defamatory messages by email Sec 499, 500 IPC

Forgery of electronic records Sec 463, 470, 471 IPC

Bogus websites, cyber frauds Sec 420 IPC

Email spoofing Sec 416, 417, 463 IPC

Online sale of Drugs NDPS Act

Web - Jacking Sec. 383 IPC

Online sale of Arms Arms Act

Some more offences dealt with
under IPC…
 Criminal breach of trust/Fraud- Sec.
405,406,408,409 IPC
 Destruction of electronic evidence-
Sec.204,477 IPC
 False electronic evidence-Sec.193 IPC
 Offences by or against public servant-
Sec.167,172,173,175 IPC
Email spoofing:
 Pranab Mitra , former executive of Gujarat Ambuja Cement posed
as a woman, Rita Basu, and created a fake e-mail ID through which
he contacted one V.R. Ninawe an Abu Dhabi businessmen . After
long cyber relationship and emotional massages Mitra sent an e-
mail that ‘‘she would commit suicide’’ if Ninawe ended the
relationship. He also gave him ‘‘another friend Ruchira Sengupta’s’’
e-mail ID which was in fact his second bogus address. When
Ninawe mailed at the other ID he was shocked to learn that Mitra
had died and police is searching Ninawe. Mitra extorted few lacs
Rupees as advocate fees etc. Mitra even sent e-mails as high court
and police officials to extort more money. Ninawe finally came down
to Mumbai to lodge a police case.
Legal provisions to counter
identity theft
 The IT Act 2000 in its present form does not have any specific provision to
deal with identity theft. However, the Expert Committee on Amendments to
the IT Act 2000 (whose report is presently under consideration by the
government for adoption) has recommended amending the Indian Penal
Code (IPC) by inserting in it two new sections:

 section 417A which prescribes punishment of up to 3 years imprisonment

and fine for 'cheating by using any unique identification feature of any other
person'; and

 section 419A that prescribes punishment of up to 5 years imprisonment and

fine for 'cheating by impersonation' using a network or computer resource.
Forgery
 Andhra Pradesh Tax Case
In the explanation of the Rs. 22 Crore which was
recovered from the house of the owner of a plastic firm
by the sleuths of vigilance department, the accused
person submitted 6000 vouchers to legitimize the
amount recovered, but after careful scrutiny of vouchers
and contents of his computers it revealed that all of them
were made after the raids were conducted . All vouchers
were fake computerized vouchers.
Cyber stalking
 Ritu Kohli (first lady to register the cyber stalking
case) is a victim of cyber-stalking. A friend of
her husband gave her phone number and name
on a chat site for immoral purposes. A computer
expert, Kohli was able to trace the culprit. Now,
the latter is being tried for "outraging the
modesty of a woman", under Section 509 of IPC.
Cyber defamation
 SMC Pneumatics (India) Pvt. Ltd. v. Jogesh Kwatra: India’s first case
of cyber defamation was reported when a company’s employee
(defendant) started sending derogatory, defamatory and obscene e-
mails about its Managing Director. The e-mails were anonymous
and frequent, and were sent to many of their business associates to
tarnish the image and goodwill of the plaintiff company.

The plaintiff was able to identify the defendant with the help of a
private computer expert and moved the Delhi High Court. The court
granted an ad-interim injunction and restrained the employee from
sending, publishing and transmitting e-mails, which are defamatory
or derogatory to the plaintiffs.
Online gambling: virtual casinos,
Cases of money laundering
 Cyber lotto case: In Andhra Pradesh one Kola
Mohan created a website and an email address on the
Internet with the address 'eurolottery@usa.net.' which
shows his own name as beneficiary of 12.5 million
pound in Euro lottery. After getting confirmation with the
email address a telgu newspaper published this as news.
He gathered huge sums from the public as well as from
some banks. The fraud came to light only when a
cheque amounting Rs 1.73 million discounted by him
with Andhra bank got dishonored.
FIR NO 76/02 PS PARLIAMENT
STREET
 Mrs. SONIA GANDHI RECEIVED THREATING
E-MAILS
 E- MAIL FROM
 missonrevenge84@khalsa.com
 missionrevenge84@hotmail.com
 THE CASE WAS REFERRED
 ACCUSED PERSON LOST HIS PARENTS
DURING 1984 RIOTS
Cyber Crime Online Challenges

Brand exploitation

Unauthorized use of trademarks

Increased difficulty in managing

online distribution channel

Sale of counterfeit goods

Current online Environment

 Easy to “hide in plain sight”

 Easy to confuse customers due to the high

quality of digital copies

 Difficult to track infringements

 Easy to establish a professional-looking

website
Common Forms of Online Threats

Trademark and Brand Infringement

Domain Name

 Commercial sites (e.g., offensive content or competing companies)

 Domain name monetization (e.g., click-through advertising)
 Unhappy consumer sites (e.g., xxx-sucks. COM) (generally, protected)
 Sale of Counterfeit Goods in Auction Sites
 Logo, Text, and Meta Tag Use in Commercial Sites
 Stopping unauthorized parties from using your trademarks
 Managing partners use of logos and trademarks
 Protecting against “Google bombing”
Domain theft
 Domain theft is an aggressive form of domain hijacking
that usually involves an illegal act. In most cases, identity
theft is used to trick the domain registrar into allowing the
hijacker to change the registration information to steal
control of a domain from the legitimate owner.
 Some registrars are quick to set things right when these
cases are discovered. However, it is well documented
that some registrars will admit no fault in accepting the
forged credentials and will refuse to correct the record
until forced by legal action. In many of these cases,
justice is not done and the hijacker retains control of the
domain.
Challenges of Cyber Security
The Environment

 Explosion of computer and broadband internet availability (over a

billion internet users today).

 Low priority of security for software developers.

 Challenge of timely patching vulnerabilities on all systems.

 Graphical user interface (GUI) based tools that exploit known software
vulnerabilities.
Electronic World
 Electronic document produced by a
computer. Stored in digital form, and
cannot be perceived without using a
computer
 It can be deleted, modified and rewritten
without leaving a mark
 Integrity of an electronic document is
“genetically” impossible to verify
 A copy is indistinguishable from the original
 It can’t be sealed in the traditional way,
where the author affixes his signature
 The functions of identification, declaration,
proof of electronic documents carried out
using a digital signature based on
cryptography.
Electronic World
 Digital signatures created and verified using
cryptography
 Public key System based on Asymmetric keys
 An algorithm generates two different and related keys
 Public key
 Private Key
 Private key used to digitally sign.
 Public key used to verify.
Public Key Infrastructure
 Allow parties to have free access to the signer’s
public key
 This assures that the public key corresponds to
the signer’s private key
 Trust between parties as if they know one another
 Parties with no trading partner agreements,
operating on open networks, need to have
highest level of trust in one another
Role of the Government

 Government has to provide the definition of

 the structure of PKI
 the number of levels of authority and their juridical
form (public or private certification)
 which authorities are allowed to issue key pairs
 the extent to which the use of cryptography should be
authorised for confidentiality purposes
 whether the Central Authority should have access to
the encrypted information; when and how
 the key length, its security standard and its time
validity
Section 3 Defines Digital
Signatures
 The authentication to be affected by use of
asymmetric crypto system and hash
function
 The private key and the public key are
unique to the subscriber and constitute
functioning key pair
 Verification of electronic record possible
Secure digital signature-S.15
 If by application of a security procedure agreed to by the parties
concerned, it can be verified that a digital signature, at the time it
was affixed, was:
(a)     unique to the subscriber affixing it;
(b)     capable of identifying such subscriber;
(c)  created in a manner or using a means under the exclusive
control of the subscriber and is linked to the electronic record to
which it relates in such a manner that if the electronic record was
altered the digital signature would be invalidated,
then such digital signature shall be deemed to be a secure digital
signature
IT Act –overview of other relevant
provisions
 Section 16- Central Government to prescribe
security procedures
 Sec 17 to 34- Appointment and Regulation of
Controller and certifying authority
 Sec 35 to 39- Obtaining DSC
 Sec 40 to 42- Duties of Subscriber of DSC-
exercise due care to retain the private key
Threats to cyber security- Methods
Used To Penetrate Victim Machines
 Trojan droppers and downloaders injected into
pirate software which is distributed via file sharing
p2p networks (kazaa, eDonkey etc.)

 Exploiting vulnerabilities in MS Windows and

popular applications such as IE & Outlook.

 Email worms
Password Authentication protocol

 Password authentication protocol, sometimes

abbreviated PAP, is a simple authentication protocol
used to a network access server used for example
by internet service provider. PAP is used by point to
point protocol. Authentication is a process of
validating a user before allowing them access to
server resources. Almost all network operating
system remote servers support PAP.
10 Ways To Wireless Security
 Use encryption - chances are bad guys won’t bother breaking it.

 Use strong encryption - in case they are trying to break it, make
it harder for them.

 Change the default admin password - avoid using ‘password as

the password.

 Turn off SSID broadcasting - don’t ’shout’ to everybody in the

neighborhood "come and try me."

 Turn off WAP when not in use - do you leave your TV on

running when you are not at home?
10 Ways To Wireless Security
 Change your default SSID - yes, there are at least 50 other ‘linksys’
stations around, and they are easier to find.

 Use MAC filtering - you give keys to your home only to trusted people
- do the same with the wireless network.

 Isolate the wireless LAN from the rest of the network - why did you
think Titanic sank? Create levels of protection.

 Control the wireless signal - unless you want to power the whole city,
there is no need to use signal amplifiers.

 Transmit on a different frequency - this is why we haven’t intercepted

the aliens yet
Protection of Personal
Information
 Identifying Purposes:- The purposes for which personal information
is collected shall be identified by the organization at or before the time
the information is collected.
 Accuracy:- Personal information shall be as accurate, complete, and
up-to-date as is necessary for the purposes for which it is to be used.
 Safeguards:- Personal information shall be protected by security
safeguards appropriate to the sensitivity of the information.
 Accountability:- An organization is responsible for personal
information under its control and shall designate an individual or
individuals who are accountable for the organization’s compliance
with the following principles.
 Openness:- An organization shall make readily available to
individuals specific information about its policies and practices
relating to the management of personal information.
Recommended cyber safety tips

 Use antivirus softwares

 change passwords frequently
 insert firewalls
 Adopt regular scanning against spyware
 install software patches
 uninstall unnecessary software
 separate user accounts
 maintain backup
 check security settings
 Perform IT audits
In case you have any queries …please feel
free to write in at
Karnika@sethassociates.com

SETH ASSOCIATES
ADVOCATES AND LEGAL CONSULTANTS

Corporate Law Office:

B-10, Sector 40, NOIDA-201301, N.C.R, India
Tel: +91 (120) 4352846, +91 9810155766
Fax: +91 (120) 4331304
E-mail: mail@sethassociates.com