Everything a Hacker Needs to Know About Getting Busted By The Feds Part 1: Federal Criminal Law

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EVERYTHING A HACKER NEEDS TO KNOW ABOUT GETTING BUSTED BY THE FEDS
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   Written By Agent Steal (From Federal Prison, 1997)
      Internet E-mail, agentsteal@usa.net
      Contributions and editing by Minor Threat and Netta Gilboa
      Special thanks to Evian S. Sim
   
This article may be freely reproduced, in whole or in part, provided
acknowledgments are given to the author. Any reproduction for profit, lame
zines, (that means you t0mmy, el8, you thief) or law enforcement use is
prohibited. The author and contributors to this phile in no way advocate
criminal behavior.


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   CONTENTS
   ----------------
   
   PART I - FEDERAL CRIMINAL LAW
   
   Foreward
   
   Introduction
   
   A. Relevant Conduct
   B. Preparing for Trial
   C. Plea Agreements and Attorneys
   D. Conspiracy
   E. Sentencing
   F. Use of Special Skill
   G. Getting Bail
   H. State v. Federal Charges
   I. Cooperating
   J. Still Thinking About Trial
   K. Search and Seizure
   L. Surveillance
   M. Presentence Investigation
   N. Proceeding Pro Se
   O. Evidentiary Hearing
   P. Return of Property
   Q. Outstanding Warrants
   R. Encryption
   S. Summary PART II - FEDERAL PRISON
   A. State v. Federal
   B. Security Levels
   C. Getting Designated
   D. Ignorant Inmates
   E. Population
   F. Doing Time
   G. Disciplinary Action
   H. Administrative Remedy
   I. Prison Officials
   J. The Hole
   K. Good Time
   L. Halfway House
   M. Supervised Release

FOREWORD
  
Nobody wants to get involved in a criminal case and I’ve yet to meet a
hacker who was fully prepared for it happening to them. There are thousands
of paper and electronic magazines, CD-ROMS, web pages and text files about
hackers and hacking available, yet there is nothing in print until now that
specifically covers what to do when an arrest actually happens to you. Most
hackers do not plan for an arrest by hiding their notes or encrypting their
data, and most of them have some sort of address book seized from them too
(the most famous of which still remains the one seized from The Not So
Humble Babe). Most of them aren’t told the full scope of the investigation
up front, and as the case goes on more comes to light, often only at the
last minute. Invariably, the hacker in question was wiretapped and/or
narced on by someone previously raided who covered up their own raid or
minimized it in order to get off by implicating others. Once one person
goes down it always affects many others later. My own
experience comes from living with a retired hacker arrested ten months after
he had stopped hacking for old crimes because another hacker informed on
him in exchange for being let go himself. What goes around, comes around.
It’s food for thought that the hacker you taunt today will be able to cut a
deal for himself by informing on you later. From what I’ve seen on the
criminal justice system as it relates to hackers, the less enemies you pick
on the better and the less groups you join and people who you i nteract
with the better as well. There’s a lot to be said for being considered a
lamer and having no one really have anything to pin on you when the feds
ask around.
  
I met Agent Steal, ironically, as a result of the hackers who had fun
picking on me at Defcon. I posted the speech I gave there on the Gray Areas
web page (which I had not originally intended to post, but decided to after
it was literally stolen out of my hands so I could not finish it) and
someone sent Agent Steal a copy while he was incarcerated. He wrote me a
letter of support, and while several hackers taunted me that I had no
friends in the community and was not wanted, and one even mailbombed our
CompuServe account causing us to lose the account and our email there, I
laughed knowing that this article was in progress and that of all of the
publications it could have been given to first it was Gray Areas that was
chosen.
  
This article marks the first important attempt at cooperation to inform the
community as a whole (even our individual enemies) about how best to
protect themselves. I know there will be many more hacker cases until
hackers work together instead of attacking each other and making it so easy
for the government to divide them. It’s a sad reality that NAMBLA,
deadheads, adult film stars and bookstores, marijuana users and other
deviant groups are so much more organized than hackers who claim to be so
adept at, and involved with, gathering and using information. Hackers are
simply the easiest targets of any criminal subculture. While Hackerz.org
makes nice T-shirts (which they don’t give free or even discount to hackers
in jail, btw), they simply don’t have the resources to help hackers in
trouble. Neither does the EFF, which lacks lawyers willing to work pro bono
(free) in most of the 50 states. Knight Lightning still owes his attorney
money. So does Bernie S. This is not something that disappears from your
life the day the case is over. 80% or more of prisoners lose their lovers
and/or their families after the arrest. While there are notable exceptions,
this has been true for more hackers than I care to think about. The FBI or
Secret Service will likely visit your lovers and try to turn them against
you. The mainstream media will lie about your charges, the facts of your
case and the outcome. If you’re lucky they’ll remember to use the word
“allegedly.” While most hackers probably think Emmanuel Goldstein and 2600
will help them, I know of many hackers whose cases he ignored totally when
contacted. Although he’s credited for helping Phiber Optik, in reality
Phiber got more jail time for going to trial on Emmanuel’s advice than his
co-defendants who didn’t have Emmanuel help them and pled instead. Bernie
S. got his jaw broken perhaps in part from the government’s anger at
Emmanuel’s publicizing of the case, and despite all the attention Emmanuel
has gotten for Kevin Mitnick it didn’t stop Mitnick’s being put in
solitary confinement or speed up his trial date any. One thing is clear
though. Emmanuel’s sales of 2600 dramatically increased as a result of
covering the above cases to the tune of over 25,000 copies per issue. It
does give pause for thought, if he cares so much about the hackers and not
his own sales and fame, as to why he has no ties to the Hackerz.org defense
fund or why he has not started something useful of his own. Phrack and
other zines historically have merely reposted incorrect newspaper reports
which can cause the hackers covered even more damage. Most of your hacker
friends who you now talk to daily will run from you after your arrest and
will tell other people all sorts of stories to cover up the fact they don’t
know a thing. Remember too that your “friends” are the people most likely
to get you arrested too, as even if your phone isn’t wiretapped now theirs
may be, and the popular voice bridges and conference calls you talk to them
on surely are.
  
They say information wants to be free, and so here is a gift to the
community (also quite applicable to anyone accused of any federal crime if
one substitutes another crime for the word hacking). Next time you put down
a hacker in jail and laugh about how they are getting raped while you’re on
IRC, remember that someone is probably logging you and if you stay active
it’s a good bet your day will come too. You won’t be laughing then, and I
hope you’ll have paid good attention when you’re suddenly in jai l with no
bail granted and every last word you read here turns out to be true. Those
of us who have been there before wish you good luck in advance. Remember
the next time you put them down that ironically it’s them you’ll have to
turn to for advice shoul d it happen to you. Your lawyer isn’t likely to
know a thing about computer crimes and it’s the cases of the hackers who
were arrested before you which, like it or not, will provide the legal
precedents for your own conviction.
  
Netta “grayarea” Gilboa
  
INTRODUCTION
  
The likelihood of getting arrested for computer hacking has increased to an
unprecedented level. No matter how precautionary or sage you are, you’re
bound to make mistakes. And the fact of the matter is if you have trusted
anyone else with the know ledge of what you are involved in, you have made
your first mistake.
  
For anyone active in hacking I cannot begin to stress the importance of the
information contained in this file. To those who have just been arrested by
the Feds, reading this file could mean the difference between a three-year
or a one-year sentence. To those who have never been busted, reading this
file will likely change the way you hack, or stop you from hacking altogether.
  
I realize my previous statements are somewhat lofty, but in the 35 months I
spent incarcerated I’ve heard countless inmates say it: “If I knew then
what I know now.” I doubt that anyone would disagree: The criminal justice
system is a game to be played, both by prosecution and defense. And if you
have to be a player, you would be wise to learn the rules of engagement.
The writer and contributors of this file have learned the hard way. As a
result we turned our hacking skills during the times of our incarceration
towards the study of criminal law and, ultimately, survival. Having filed
our own motions, written our own briefs and endured life in prison, we now
pass this
knowledge back to the hacker community. Learn from our experiences… and
our mistakes.
  
Agent Steal
  
  PART I – FEDERAL CRIMINAL LAW
  
  A. THE BOTTOM LINE – RELEVANT CONDUCT
  
For those of you with a short G-phile attention span I’m going to cover the
single most important topic first. This is probably the most substantial
misunderstanding of the present criminal justice system. The subject I am
talking about is referred to in legal circles as “relevant conduct.” It’s a
bit complex and I will get into this. However, I have to make his crystal
clear so that it will stick in your heads. It boils down to two concepts:
  
  I. ONCE YOU ARE FOUND GUILTY OF EVEN ONE COUNT, EVERY COUNT WILL BE USED
TO CALCULATE YOUR SENTENCE
  
Regardless of whether you plea bargain to one count or 100, your sentence
will be the same. This is assuming we are talking about hacking, code
abuse, carding, computer trespass, property theft, etc. All of these are
treated the same. Other crimes you committed (but were not charged with)
will also be used to calculate your sentence. You do not have to be proven
guilty of every act. As long as it appears that you were responsible, or
someone says you were, then it can be used against you. I know this sounds
insane , but it’s true; it’s the preponderance of evidence standard for
relevant conduct. This practice includes using illegally seized evidence
and acquittals as information in increasing the length of your sentence.
  
  II. YOUR SENTENCE WILL BE BASED ON THE TOTAL MONETARY LOSS
  
The Feds use a sentencing table to calculate your sentence. It’s simple;
More Money = More Time. It doesn’t matter if you tried to break in 10 times
or 10,000 times. Each one could be a count but it’s the loss that matters.
And an unsuccessful attempt is treated the same as a completed crime. It
also doesn’t matter if you tried to break into one company’s computer or
10. The government will quite simply add all of the estimated loss figures
up, and then refer to the sentencing table.
  
  B. PREPARING FOR TRIAL
  
I’ve been trying to be overly simplistic with my explanation. The United
States Sentencing Guidelines (U.S.S.G.), are in fact quite complex. So much
so that special law firms are forming that deal only with sentencing. If
you get busted, I would highly recommend hiring one. In some cases it might
be wise to avoid hiring a trial attorney and go straight to one of these
“Post Conviction Specialists.” Save your money, plead out, do your time.
This may sound a little harsh, but considering the fact that the U.S.
Attorney’s Office has a 95% conviction rate, it may be sage advice.
However, I don’t want to gloss over the importance of a ready for trial
posturing. If you have a strong trial attorney, and have a strong case, it
will go a long way towards good plea bargain negotiations.
  
  C. PLEA AGREEMENTS AND ATTORNEYS

Your attorney can be your worst foe or your finest advocate. Finding the
proper one can be a difficult task. Costs will vary and typically the
attorney asks you how much cash you can raise and then says, “that amount
will be fine”. In actuality a simple plea and sentencing should run you
around $15,000. Trial fees can easily soar into the 6 figure category. And
finally, a post conviction specialist will charge $5000 to $15,000 to
handle your sentencing presentation with final arguments.
  
You may however, find yourself at the mercy of The Public Defenders Office.
Usually they are worthless, occasionally you’ll find one that will fight
for you. Essentially it’s a crap shoot. All I can say is if you don’t like
the one you have, fire them and hope you get appointed a better one. If
you can scrape together $5000 for a sentencing (post conviction) specialist
to work with your public defender I would highly recommend it. This
specialist will make certain the judge sees the whole picture and will
argue in the most effective manner for a light or reasonable sentence. Do
not rely on your public defender to thoroughly present your case. Your
sentencing hearing is going to flash by so fast you’ll walk out of the
court room dizzy. You and your defense team need to go into that hearing
fully prepared, having already filed a sentencing memorandum.
  
The plea agreement you sign is going to affect you and your case well after
you are sentenced. Plea agreements can be tricky business and if you are
not careful or are in a bad defense position (the case against you is
strong), your agreement may get the best of you. There are many issues in a
plea to negotiate over. But essentially my advice would be to avoid signing
away your right to appeal. Once you get to a real prison with real
jailhouse lawyers you will find out how bad you got screwed. That issue
notwithstanding, you are most likely going to want to appeal. This being
the case you need to remember two things: bring all your appealable issues
up at sentencing and file a notice of appeal within 10 days of your
sentencing. Snooze and loose.

 

I should however, mention that you can appeal some issues even though you
signed away your rights to appeal. For example, you can not sign away your
right to appeal an illegal sentence. If the judge orders something that is
not permissible by statute, you then have a constitutional right to appeal
your sentence.
  
I will close this subpart with a prison joke. Q: How can you tell when your
attorney is lying? A: You can see his lips moving.
  
  D. CONSPIRACY
  
Whatever happened to getting off on a technicality? I’m sorry to say those
days are gone, left only to the movies. The courts generally dismiss many
arguments as “harmless error” or “the government acted in good faith”. The
most alarming trend, and surely the root of the prosecutions success, are
the liberally worded conspiracy laws. Quite simply, if two or more people
plan to do something illegal, then one of them does something in
furtherance of the objective (even something legal), then it’s a crime.
Yes, it’s true. In America it’s illegal to simply talk about committing a
crime. Paging Mr. Orwell. Hello?
  
Here’s a hypothetical example to clarify this. Bill G. and Marc A. are
hackers (can you imagine?) Bill and Marc are talking on the phone and
unbeknownst to them the FBI is recording the call. They talk about hacking
into Apple’s mainframe and erasing the prototype of the new Apple Web
Browser. Later that day, Marc does some legitimate research to find out
what type of mainframe and operating system Apple uses. The next morning,
the Feds raid Marc’s house and seize everything that has wires. Bill and
Marc go to trial and spend millions to defend themselves. They are both
found guilty of conspiracy to commit unauthorized access to a computer system.
  
  E. SENTENCING
  
At this point it is up to the probation department to prepare a report for
the court. It is their responsibility to calculate the loss and identify
any aggravating or mitigating circumstances. Apple Computer Corporation
estimates that if Bill and M arc would have been successful it would have
resulted in a loss of $2 million. This is the figure the court will use.
Based on this basic scenario our dynamic duo would receive roughly
three-year sentences.
  
As I mentioned, sentencing is complex and many factors can decrease or
increase a sentence, usually the latter. Let’s say that the FBI also found
a file on Marc’s computer with 50,000 unauthorized account numbers and
passwords to The Microsoft Network. Even if the FBI does not charge him
with this, it could be used to increase his sentence. Generally the
government places a $200-per-account attempted loss on things of this
nature (i.e. credit card numbers and passwords = access devices). This
makes for a $10 million loss. Coupled with the $2 million from Apple, Marc
is going away for about nine years. Fortunately there is a Federal Prison
not too far from Redmond, WA so Bill could come visit him.
  
Some of the other factors to be used in the calculation of a sentence might
include the following: past criminal record, how big your role in the
offense was, mental disabilities, whether or not you were on probation at
the time of the offense, if any weapons were used, if any threats were
used, if your name is Kevin Mitnick (heh), if an elderly person was
victimized, if you took advantage of your employment position, if you are
highly trained and used your special skill, if you cooperated with the
authorities, if you show remorse, if you went to trial, etc.
  
These are just some of the many factors that could either increase or
decrease a sentence. It would be beyond the scope of this article to cover
the U.S.S.G. in complete detail. I do feel that I have skipped over some
significant issues. Neverthele ss, if you remember my two main points in
addition to how the conspiracy law works, you’ll be a long way ahead in
protecting yourself.
  
  F. USE OF A SPECIAL SKILL
  
The only specific “sentencing enhancement” I would like to cover would be
one that I am responsible for setting a precedent with. In U.S. v Petersen,
98 F.3d. 502, 9th Cir., the United States Court of Appeals held that some
computer hackers may qualify for the special skill enhancement. What this
generally means is a 6 to 24 month increase in a sentence. In my case it
added eight months to my 33-month sentence bringing it to 41 months.
Essentially the court stated that since I used my “sophisticated” hacking
skills towards a legitimate end as a computer security consultant, then the
enhancement applies. It’s ironic that if I were to have remained strictly a
criminal hacker then I would have served less time.
  
The moral of the story is that the government will find ways to give you as
much time as they want to. The U.S.S.G. came into effect in 1987 in an
attempt to eliminate disparity in sentencing. Defendants with similar
crimes and similar backgrounds would often receive different sentences.
Unfortunately, this practice still continues. The U.S.S.G. are indeed a
failure.
  
  G. GETTING BAIL

In the past, the Feds might simply have executed their raid and then left
without arresting you. Presently this method will be the exception rather
than the rule and it is more likely that you will be taken into custody at
the time of the raid. Chances are also good that you will not be released
on bail. This is part of the government’s plan to break you down and win
their case. If they can find any reason to deny you bail they will. In
order to qualify for bail, you must meet the following criteri a:
  
  – You must be a resident of the jurisdiction in which you were arrested.
  
  – You must be gainfully employed or have family ties to the area.
  
  – You cannot have a history of failure to appear or escape.
  
  – You cannot be considered a danger or threat to the community.
  
  In addition, your bail can be denied for the following reasons:
  
  – Someone came forward and stated to the court that you said you would
flee if released.
  
  – Your sentence will be long if convicted.
  
  – You have a prior criminal history.
  
  – You have pending charges in another jurisdiction.
  
What results from all this “bail reform” is that only about 20% of persons
arrested make bail. On top of that it takes 1-3 weeks to process your bail
papers when property is involved in securing your bond.
  
Now you’re in jail, more specifically you are either in an administrative
holding facility or a county jail that has a contract with the Feds to hold
their prisoners. Pray that you are in a large enough city to justify its
own Federal Detention Center. County jails are typically the last place you
would want to be.
  
  H. STATE VS. FEDERAL CHARGES
  
In some cases you will be facing state charges with the possibility of the
Feds “picking them up.” You may even be able to nudge the Feds into
indicting you. This is a tough decision. With the state you will do
considerably less time, but will face a tougher crowd and conditions in
prison. Granted Federal Prisons can be violent too, but generally as a
non-violent white collar criminal you will eventually be placed into an
environment with other low security inmates. More on this later.
  
Until you are sentenced, you will remain as a “pretrial inmate” in general
population with other inmates. Some of the other inmates will be
predatorial but the Feds do not tolerate much nonsense. If someone acts up,
they’ll get thrown in the hole. If they continue to pose a threat to the
inmate population, they will be left in segregation (the hole).
Occasionally inmates that are at risk or that have been threatened will be
placed in segregation. This isn’t really to protect the inmate. It is to pr
otect the prison from a lawsuit should the inmate get injured.
 

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