Cyber

Crime as a
form of
Economic
Crime
Sherwin A. Cabutija RCrim.

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TABLE OF CONTENTS

I.

INTRODUCTION
a. Definition of terms
Computer crimes
Computers as telecommunication engines and the crime of fraud it constitute
How computer commits crime?
Computer as a transnational crime tool
Computer as a tool of committing crimes of
Computer crimes
Internet crime
b. Local, National, and Global Situation
The love bug virus from the Philippines
The Russian Hackers
Cybercrime Havens
c. Statistics Data
Computer criminals

d. Discussion/Explanation why Cyber Crime considered as an Economic Crime

II.

III.

PROBLEMS ENCOUNTERED BY LAW ENFORCEMENT AGENCIES IN

COMBATING THE CRIME
The International Response
Convention imposes
RECOMMENDATION
Indonesia
Thailand
Malaysia
Philippines

I.

INTRODUCTION

Computer crimes
This research is designed to provide readers an overview and understanding on:
1.
2.
3.
4.

How computer crimes related to economic crime

The internet as an instrument for crime
Cyber as a highway of cybercrime
Philippine Special Laws regulating the use of Electronics and Computers in
Business and Commerce.

In most cases technology is widely used among all countries and it still evolving as time goes
by. Criminologist as well as criminal justice experts are trying to conduct research on the crime
and penalty of this computer crime may pose to the national and personal security. The need to
control computer crimes is fairly obvious, even though cyber crimes and information warfare
have not yet become major security issues in most countries (Speer 2000).
Computers as telecommunication engines and the crime of fraud it constitute
a. Cellular phone cloning;
b. Illegal use of telecommunication frequency;
c. Third number fraud or the act of charging a call to neither the caller nor the called
number, but to a third party without consent;
d. Illegal connection into a telecommunication network;
e. Telecommunication card fraud, including the act of manufacturing, distributing,
selling or using of fake, tampered, stolen or unauthorized telecommunication cards;
f. Payphone fraud;
g. Illegal operation of telecommunication service;
h. Illegal calling scheme;
i. Subscription fraud;
j. Illegal importation o electronic serial number(ESN) readers to people;
k. Conspiracy is committed when two or more telecommunication fraud, and
l. The mere possession of a cloning device or cloned phone is a prima facie evidence of
tele fraud.
How computer commits crime?
1. The transfer on accounts to the perpetrators accounts. This is plain and simple
Estafa or Swindling.
2. When used to retrieve confidential information from the data bank of the
employer. This is the violation of the intellectual property rights, over the property
of his intellect.
3. Introducing a complex program to alter the data already in existence. This
constitutes economic sabotage or treason in political parlance.

DEFINITION OF TERMS
Computer as a transnational crime tool
Transnational crime typically implies cross borders; with the use of computer obviously
has immediate effect to national and continental boundaries. Todays social theorist argues that
todays world is undergoing fundamental and monumental structure changes. These changes
have been defined as globalization which means time and space compression (Harvey 1998).
Interlinked by computers are by their very nature essential components of globalization. Keller,
2002, although their are many uses for the idea of globalization, one involves a worlds capitalist
eliminating the primacy, effectiveness, and even the necessity of the most cherished modern form
of geopolitical organizations- the nation-state. In this perspective, transnational corporation and
organization are eroding and dismantling local structures, traditions and cultures.
Computer as a tool of committing crimes of
1. Financial crimes at one level, money laundering is simple; ones ill gotten money
is converted to a less suspicious, less traceable form of asset. With the advent of
computer involvement in money laundering schemes, even more layer of safety can
be created.
2. Financial fraud this applies to traditional local forms of fraud as well as new form
of cross border fraud. Those engaged in fraud typically prey on people who are
looking to make a better than average return on their investments. The advent of the
internet has allowed chat rooms, e-mail, or websites to be used as vehicles for
conducting fraud.
3. Internet fraud includes also, identity theft, credit card frauds, trademark, copyright
or patent counterfeiting.
4. Scam has committed (EX. The Nigeria scam, dominion of Melchizedek)
a. Nigerian scam it operates as follows; the target receives as unsolicited fax, email, or letter often concerning Nigerian or another African nation containing
either or money laundering or other illegal proposals or you receive a legal and
legitimate proposal by normal means. At some point, the victim is asked to pay
up front, an advance fee of some sort, be it advance fee, transfer tax, performance
bond, or to attend credit grand, CIOD privilege. If the victims pay the fee, there
are many complications which require more advance payments. (The 419
Coalition, 2003)
b. Dominion of Melchizedek a pseudo state jurisdiction or influence over an
increasing number of pacific islands but existing primarily in cyberspace. It
registers insurance companies, bank and other entities for clients who would have
great difficulties in obtaining them. It serves as a king of underground government
which organizes independent entrepreneurial criminals bringing them together
and providing them with connections, pseudo state corporate entities, diplomatic
passport, government positions and laws (Fassen 2002).

Computer crimes its capability and extent; the widespread use of computers to record
business transactions has encourage some people to use them to illegal purposes. Computer
crimes generally fall into one of the five categories.
1. Theft or services, in which the criminal uses the computer for unauthorized purposes
or an unauthorized user, penetrates the computer system. Includes therein this
category is the theft of processing time and services not entitled to an employee.
2. Unauthorized use of computer employed for various types of financial processing
to obtain assets.
3. Use of data in the computer for personal gain.
4. Theft of property by computer for personal use or conversation to profit. For
example, using a computer to illegally copy and sell software.
5. Making the computer itself the subject of the crime for example, when a virus is
place in it to destroy a data.
Internet crime the second form of cybercrime has now become routine. While it is impossible
to list and discuss every element of this newly emerging problem, a few of the most important
areas are described below.
1. Distributing illegal sexual material the internet is ideal venue for selling and
distributing obscene material. One reason is that it is difficult to identify perpetrators
and even if they can be detected, even harder to prosecute. For example, in one well
known case, Landslide Production Incorporated of forth worth, Texas, operated by
highly profitable internet based pornography is ring taking in as much as $1.4 million
in one month. Landslide charge it customer $29.95 per month for a gate away child
pornography website. However, the site originated in Russia and Indonesia and
therefore was off limits to control by US authorities; they had a fee sharing agreement
with Landslide owners.
2. Denial of service attack some internet criminals threatened to or actually flood an
interment site with millions of bogus messages and/or orders so site services will be
tied up and unable to perform as promised. Unless the site operators pays extortion.
The attackers threatened to keep up the interference until real; consumers become
frustrated and abandon the site. The online gambling casino is particularly vulnerable
to attack, especially when the attack coincide with sporting events such as a super
bowl.
3. Illegal copyright infringement in the past decades, group of individuals have been
working together to illegally obtain software and then crack or rip its copyright
protections before posting it on the internet. This is referred to as Warez
4. Internet Securities some criminals used the internet to intentionally manipulate the
security marketplace for profit.
a. Market manipulation- an individual post erroneous and deceptive informations
online to artificially inflate the price of the stock (so they can sell previous
purchased shares) or they post negative rumours, driving down the price of the
stock so they can but it as lower levels.
b. Fraudulent offering of securities some cybercriminals creates websites
specially designed to fraudulent sell securities. To make it on not, cybercrime
presents the most fundamental challenge for law enforcement in 21st century.

LOCAL, NATIONAL, AND GLOBAL SITUATION

The love bug virus from the Philippines
In May 2000, the Love Bug virus raced around the world, shutting down business and
government computers in more than 45 countries and causing billions of dollars in damage. The
FBI quickly traced the virus to the Philippines, where they identified Onel de Guzman as its
likely author. Since the Philippines then had no cybercrime law, disseminating the virus was not
a crime in that country, de Guzman therefore could not be prosecuted in the Philippines, and he
could not be extradited for prosecution in the United States because extradition treaties require
that conduct have been criminalized by the country seeking extradition and the country holding
the suspect. No one was ever prosecuted for the Love Bug. Catch Me if You Can
The Russian Hackers
Also in 2000, US businesses were being victimized by hackers who extorted money by
threatening to release information stolen from the companies' computers. The hackers, Alexei
Ivanov and Vasiliy Gorshkov, made no effort to conceal their identities because they were in
Russia, which did not have a cybercrime extradition treaty with the United States. The FBI used
a sting to lure them to the United States. The Russians were invited, and came at their own
expense, to interview with Invita, a fake computer security company in Seattle. Once there,they
demonstrated their hacking skills using laptops on which the FBI had installed keystroke loggers,
programs that record what is typed on a keyboard. These loggers recorded the usernames and
passwords that the hackers used to access a Russian server that held tools that they needed to
show their prowess. After the loggers captured the usernames and passwords, the FBI arrested
both men and used the captured information to access the Russian server and download data that
became evidence in the prosecution of the hackers. Gorshkov moved to suppress this data,
arguing that it was obtained in violation of the Fourth Amendment because the agents did not
have a search warrant and that the agents had violated Russian law by "hacking" the Russian
computer. The court rejected his Fourth Amendment argument because it found that the search of
and extraction of data from the Russian computer occurred outside the United States; the
Supreme Court has held that the Fourth Amendment does not apply to extraterritorial searches
directed at non-citizens.
The court also found that Russian law did not apply to the actions of the US federal
agents. Gorshkov was convicted, served three years, and went home. The most interesting
development in the case came in 2002, when the Russian Federal Security Service charged FBI
agent Michael Schuler with hacking for his role in accessing the Russian computer. The
Russians said that, while they did not expect the United States to turn Schuler over for
prosecution (which has not happened), they felt that the charges were necessary to assert Russian
sovereignty. The Federal Security Service said that, if the Russian hackers' sentences were based
on information that US agents had obtained by hacking Russian computers, this would open the
door for US investigators to use such "illegal methods" in the future, against suspects in Russia
and in other countries.

Cybercrime Havens
These two cases illustrate the challenges that cybercrime poses for criminal law. Law is at
base territorial; criminal laws are promulgated and enforced by nation states, which use them to
control crime and maintain the baseline of internal order that a society requires to survive.
Criminal law therefore has been purely domestic; external threats to order that came from nationstates were dealt with by the military, not by law enforcement.
Cyberspace erodes the viability of this model. Territorial boundaries become irrelevant as
online crime bleeds across national borders. Law enforcement officers find themselves
confronting attacks that come, or seem to come, from halfway around the world. The crime scene
is no longer local or unitary; it is fragmented into shards that will be scattered through several
continents if the attacker was clever enough to route the attack through servers in different
countries. Domestic law enforcement officers have little, if any, expertise in conducting this kind
of investigation, and even when they do, they can confront obstacles such as the extradition
issues that we saw in the cases discussed earlier.
The Invita scenario illustrates a possibility that generates concern among those charged
with enforcing criminal law: cybercrime havens. In the Love Bug case, the Philippines was an
inadvertent cybercrime haven; its failure to have cybercrime laws was an oversight, one the
country quickly remedied. The Invita case comes closer to the true haven scenario. Russia had
laws criminalizing hacking, but they were only for domestic use; Russia did not have laws in
place to extradite Russians who attacked computers in other countries. The combination creates a
de facto cybercrime haven, a country that outlaws internal cybercrime but tolerates, or even
encourages, external cybercrime. The resulting scenario is analogous to the pirate havens that
flourished in the Caribbean in the 18th century in which outlaws have a sheltering base of
operations from which to generate revenue by preying on outsiders.
STATISTICS DATA
Statistics Data
Computer criminals
Sentencing
date(s)

Name

Handle

Nationality

Conviction(s)

Penalty

Lewys
Martin

sl1nk

United
Kingdom

Pled guilty to five counts of May 16, 2013 Two

`unauthorised acts with intent to
imprisonment
impair
operation
of
or
prevent/hinder access to a
computer, two of `unauthorised
computer access with intent to
commit other offences, one of
`unauthorised computer access
with intent to commit other

years

Name

Handle

Nationality

Sentencing
date(s)

Conviction(s)

Penalty

offences,
and
one
of
'unauthorised
access
to
computer
material'.
Hacking
attempt
on
the
websites of Kent Police,
Cambridge
University
and
Oxford
University.
Former
member of Null Crew and said
to have penetrated the servers
of Department of Defense
(DoD), Pentagon, NASA, NSA,
other UK government websites.

Mark Abene

Phiber
Optik

Misdemeanour theft-of-service
for a free-call scam to a 900
number
1991

35
hours
of
community
service

United States
One

count

of

computer 1993

trespass and one count of

One-year
sentence

jail

computer conspiracy.

Jeanson
James
Ancheta

Gobo

Pled guilty to four federal

charges of violating United
States Code Section 1030,
United States Fraud and Related Activity in May 8, 2006
Connection with Computers,
specifically subsections (a)(5)
(A)(i), 1030 (a)(5)(B) and 1030

Julian Paul Mendax /

Australia
Assange
profff

Adam Botbyl

57 months in prison,
forfeit a 1993 BMW
and
more
than
US$58,000 in profit
Restitution
of
US$15,000 to the
U.S.
federal
government
for
infecting
military
computers

A
recorded
conviction on all
31 charges of hacking and
counts, a reparation
related charges. Pled guilty to 5 December payment of A$2,100
25 charges, the remaining 6 1996
to ANU (to be paid in
were dropped.
3 months time) and
a A$5,000
goodbehaviour bond.[

United States Conspiracy to steal credit card December 16, Two years and two
numbers from the Lowe's chain 2004
months
of home improvement stores
imprisonment,

Name

Handle

Nationality

Sentencing
date(s)

Conviction(s)

Penalty
followed
by
two
years of supervised
release.

unknown

$65
fine.
Discretionary appeal
denied. Direct appeal
to Iowa Supreme
One count simple harassment
Court of three year
for
sending
six
Gmail
suspension by Iowa
messages deemed to be
State
University
United States
November 24,
"annoying" with another Gmail
docket
#12-1371.
(Iowa)
2009
user over the course of six
Issues:
Double
months and discovered in their
Jeopardy, use of the
SPAM folder on July 28, 2009.
word
"annoying"
in Iowa
Code
708.7 is void
for
vagueness, interstate
commerce.

Pled guilty to 56 charges of September

"mischief to data.
12, 2001

Eight months "open

custody,"
by
the
Montreal
Youth
Court, one-year of
probation, restricted
use of the Internet
and a small fine

Mike Calce

MafiaBoy Canada

Chad Davis

Six months in prison,

Intentionally hacking a
US$8,054
in
Mindphasr United States protected computer and wilfully March 1, 2000
restitution and three
causing damage.
years probation.

Nahshon
Phoenix
Even-Chaim

Australia

15
charges
including
trespassing on the University of
Texas
computer
network, 1993
altering data at NASA and the
theft of the ZARDOZ file.

One-year suspended
sentence: A$1,000
good-behaviour bond
and
500
hours
community service
The case is in New
Delhi
Court
and
Hackers are still at
August large. Two Hackers
are arrested till date
with Charge of INR 5
Million
Indian
Rupees.

DarkL00k

DarkL00k India

Charged for Hacking Over a Ecommerce Portal with Approx $

28
1,000,000 USD of total Fraud.
2006
He is charged with his 3 fellow
hackers belong to Indi shell.

Unknown

Trax

Australia

counts

of

hacking

and 20 September (Due to a history of

Name

Handle

Nationality

Conviction(s)

Sentencing
date(s)

Penalty

mental illness) no
recorded conviction
phreaking. Pled guilty to all
and a A$500 threecharges.
20 September
year good-behaviour
1995
bond.
1995

Raphael
Gray

Curador

United
Kingdom

Pled guilty to theft and hacking

offenses which fall under the
Computer Misuse Act and six
charges
of
intentionally
July 6, 2001
accessing
sites
containing
credit card details and using
this information for financial
gain

Three
years
of
psychiatric treatment
after
evidence
emerged that he was
suffering
from
a
mental
condition
which
needed
medical
treatment
rather
than
incarceration

Jerome
Heckenkam MagicFX
p

Admitted the hacking and

United States pleaded guilty to two felonies in 2004
2004.

Sentenced to Time
Served
after
spending 7 months in
prison.

Jonathan
James

Two
counts
United States
delinquency

Six-month
prison
sentence
and
probation until the
age of eighteen.

Richard
Jones

Samy
Kamkar

Cameron
Lacroix

c0mrade

of juvenile September
21, 2000

Electron

Australia

Trespassing on the University

of Texas computer network and 1993
theft of the ZARDOZ file

One year and six

months suspended
sentence, 300 hours
of community service
and
psychiatric
assessment
and
treatment.

Samy

Pled
guilty
to
violating
California Penal Code 502(c)(8)
for creating the "Samy is my
United States
2007
hero" XSS worm that spread
across
the MySpace social
networking site.

Three years of formal

probation, 90 days of
community service,
restitution paid to
MySpace,
restrictions
on
computer use.

cam0

United States Pled guilty to hacking into the September

cell-phone account of celebrity 13, 2005
Paris Hilton and participated in
an attack on data-collection
firm LexisNexis Group
that
exposed personal records of

11 months in a
Massachusetts
juvenile
detention
facility.

Name

Handle

Nationality

Sentencing
date(s)

Conviction(s)

Penalty

more than 300,000 consumers

Adrian Lamo

One-count
of computer
crimes against Microsoft,
United States
July 15, 2004
LexisNexis and The New York
Times.

Six months detention

at his parent's home
plus
two
years
probation
and
roughly US$65,000
in restitution

Kevin
Mitnick

Four counts of wire fraud, two

counts of computer fraud and
August
United States one
count
of
illegally
1999
intercepting
a
wire
communication.

46 months in federal
prison and US$4,125
in restitution

Dennis
Moran

Robert
Tappan
Morris

Condor

Coolio

Rtm

Jeffrey Lee
T33kid
Parson

United States

Misdemeanor
hacking.

charges

Nine months in jail

of
and US$5,000 in
March 9, 2001
restitution to each
victim.

Intentional access of federal

interest
computers
without
authorization
thereby
United States
preventing authorized access
and causing a loss in excess of
US$1,000.

Three
years
probation and 400
hours of community
service in a manner
May 16, 1990
determined by the
Probation Office and
approved by the
Court.

Pled guilty on August 11, 2004

to one count of intentionally
causing or attempting to cause January
United States
damage
to
a
protected 2005
computer via his version of
the Blaster computer worm.
distributing

1,

18 months in prison
and 100 hours of
community service

Chris Pile

The Black United

Baron
Kingdom

Kevin
Poulsen

Kevin
Poulsen

Pled guilty to seven counts of

mail, wire and computer fraud,
United States
June 1, 1994
money
laundering
and
obstruction of justice.

Terminus

Illicit use of proprietary software

(UNIX
3.2 code)
owned
by AT&T. and 2 counts of
One-year
United States computer fraud and three June 12, 1991
sentence
counts
of
interstate
transportation
of
stolen
property.

Leonard
Rose

Writing
and
computer viruses

9,

1995

18 months in prison
51 months in prison
and ordered to pay
US$56,000
in
restitution

jail

Name

David
Smith

L.

Ehud
Tenenbaum

Nationality

Kwyjibo

Pled
guilty
to
knowingly
spreading a computer virus,
United States
May 1, 2002
the Melissa virus, with the
intent to cause damage.

Analyzer

Simon Vallor Gobo

Gerald
Wondra

Jan de Wit

James
Jeffery

Simon
Williamson

Markus
Binder

Conviction(s)

Sentencing
date(s)

Handle

Israel

Admitted to cracking US and

Israeli computers, and pled
guilty to conspiracy, wrongful
June 15, 2001
infiltration
of
computerized
material, disruption of computer
use and destroying evidence.

United
Kingdom

Writing
and
distributing January
three computer viruses.
2003

Penalty
20 months in federal
prison,
US$5,000
fine and 100 hours of
community
service
upon release
Six
months
of
community service,
one-year
of
probation, a two-year
suspended
prison
sentence and fined
about US$18,000

21, Two-year
sentence

Unauthorized
access
to
computers
at
the SloanKettering Cancer Center in New
The 414s United States
May 1, 1983
York and a Los Angeles
bankand two counts of "making
harassing telephone calls"

jail

Two years probation

OnTheFly Netherlands

Spreading data into a computer

network with the intention of September
causing damage as the creator 27, 2001
of the Anna Kournikova virus

Pablo
Escobar

United
Kingdom

Hacked
into
the
British
Pregnancy Advisory Service,
stole patient information and
32
months
April 13, 2012
defaced the webpage. Pled
imprisonment
guilty to 2 counts of computer
misuse.

Australia

Was arrested in 1992 on 38

charges of Telecommunications May 1, 1992
fraud (Phreaking).

Served a three-year
$10,000
good
behavior bond, and
was fined $2000, 150
Community Service
Hours.

Australia

Worked with Ripmax and was

also arrested. He was charged
with
34
charges
of May 1, 1992
Telecommunications
fraud
(Phreaking)

Ripmax

Murf

150
hours
community service

served a three-year
$10,000
good
behavior bond, and
was fined $2000, 150
Community Service
Hours

DISCUSSION/EXPLANATION WHY IT IS CONSIDERED AS ECONOMIC CRIME

The Philippines has rapidly become a key hub of the billion-dollar global child cybersex
industry, with operators aided by widespread poverty and legal loopholes that allow them to
remain anonymous, according to Senior Superintendent Gilbert Sosa, chief of the ant cybercrime
unit of the Philippine National Police (PNP).
Paying subscribers anywhere in the world can log in to sites operated from Manila and
across the archipelago that stream the abuse of Filipino children on the Internet, Sosa told a news
conference Friday.
We are the origin, the source, Sosa said, adding the industry spread rapidly across the
country last year.
Police in Britain, Australia and the Philippines announced on Thursday that they had
jointly dismantled a pedophile ring that streamed live sexual abuse of Filipino children as young
as 6 over the Internet. In some cases, the victims parents were involved.
Among top 10
Fifteen victims aged between 6 and 15 have been rescued in the joint Operation
Endeavour in 12 countries, Britains National Crime Agency (NCA) said on Thursday, adding
that 29 people had been arrested, including 11 in the Philippines.
Three other ongoing investigations have identified 733 suspects, the NCA said.
Sosa said the Philippines was the top 10 purveyor of what he described as a global
cottage industry [worth] billions of dollars.

II.

PROBLEMS ENCOUNTERED BY LAW ENFORCEMENT AGENCIES IN

COMBATING THE CRIME

International efforts to combat cyber-crime are reviewed by evaluating the forms of

mutual legal assistance (MLA) now in place. Findings - Cyber-crime is often traditional crime
(e.g. fraud, identify theft, child pornography) albeit executed swiftly and to vast numbers of
potential victims, as well as unauthorised access, damage and interference to computer systems.
Most detrimental are malicious and exploit codes that interrupt computer operations on a global
scale and along with other cyber-crimes threaten e-commerce. The cross-national nature of most
computer-related crimes have rendered many time-honoured methods of policing both
domestically and in cross-border situations ineffective even in advanced nations, while the
"digital divide" provides "safe havens" for cyber-criminals. In response to the threat of cybercrime there is an urgent need to reform methods of MLA and to develop trans-national policing
capability. Practical implications The international response is briefly outlined in the context of
the United Nations (UN) Transnational Organised Crime Convention (in force from September
2003) and the Council of Europe's innovative Cyber-crime Convention (in force from July 2004).
In addition, the role of the UN, Interpol, other institutions and bi-lateral, regional and other
efforts aimed a creating a seamless web of enforcement against cyber-criminals are described.
Originality/value - The potential for potent global enforcement mechanisms are discussed.
The International Response
How do we deal with the prospect-or the reality-of cybercrime havens? The best
possibility we currently have for a solution is the Council of Europe's Convention on
Cybercrime. It is based on the premise that harmonizing national laws will facilitate cooperation
between law enforcement officers investigating cybercrime and eliminate the haven scenario by
ensuring that cybercriminals can be prosecuted and extradited for prosecution. To that end, it
requires countries that sign and ratify the Convention to outlaw a core of cybercrime offenses, to
ensure that their law lets them assist officers from other countries with cybercrime investigations
and extradite cybercriminals, and to ensure they have jurisdiction to prosecute cybercrimes.
The Council of Europe opened the Convention for signature on November 23, 2001.
Forty-three countries have signed the Convention and 21 have ratified it: Albania, Armenia,
Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Denmark, Estonia, Finland, France,
Hungary, Iceland, Latvia, Lithuania, the Netherlands, Norway, Romania, Slovenia, the former
Yugoslav Republic of Macedonia, Ukraine, and the United States. Any member of the Council of
Europe can sign and ratify the Convention; several non-member states, including the United
States, can do so because they were involved in drafting the Convention. The parties to the
Convention can allow other countries to sign and ratify it as well. How successful will the
Convention be in bringing countries together in the fight against cybercrime? That remains to be
seen. Some may elect not to sign it because they reap certain benefits from cybercrime.
Countries that have little experience with cybercrime may be deterred by the complex legal
obligations that the
Convention imposes

Finally, while cybercrime is a high priority for "victim" countries like the United States, it
is much less of a concern for nations that have yet to become the targets of cybercriminals.
Solutions to this are not an esoteric, academic concern. A lawyer must have at least basic
knowledge in this arena to adequately counsel clients. Remember, Ivanov and Gorshkov were
extorting US businesses during their purely domestic endeavours. What can you actually do for
your client if it becomes the next victim of a cybercriminal? From a practical Perspective, the
first thing to do is make sure that your client's system is operational and as safe as possible.
Once done, the next objective is to determine how you and your client should respond.
Should you contact law enforcement or file a civil suit? "Hacking" and "data theft" are not only
crimes, the acts constituting those actions also may give rise to a private cause of action. If a
thief steals your computer's data, it is not only a crime; it also could give rise to a cause of action
for misappropriation of trade secrets.
If you are able to bring a civil action, there are two factors that must be immediately considered:
1. Do you have the resources to respond without involving law enforcement?
2. Where do you have the best chance of success?
You should realistically discuss with your client whether it actually is able or willing to
devote enough resources to the case to avoid involving law enforcement. The answers will
naturally depend upon whether your client is financially able to hire a consultant to help with the
case, taking into account the importance of the entire matter.
If you proceed with a civil action, you probably will hire computer forensic consultants to
preserve the evidence on your side and stand ready to image whatever evidence the court allows
your opponents to preserve. The lawyer on the case, either you or someone you retain, will then
probably draft a complaint and motion for temporary restraining order and for preliminary
injunction. Sometimes this can be done ex parte, but most of the time, you will have to contact
the other side before any relief will be granted. You will then most likely be forced to file a
motion for expedited discovery. If the judge does not grant immediate relief you will have to
look to the standard civil discovery procedures, which normally means that it will be a few
months before you get into any real discovery. Mere suspicion that the other side may destroy
data is not likely to convince a judge to let you image the digital evidence from the other side.
After you consider the difficulties in these processes, think about how you would obtain evidence
in the possession of third parties. In that event, you could be forced to file a motion for letters
rogatory or to take depositions out of state.
Now compare the alternative of involving law enforcement. In most cybercrimes, law
enforcement has four general methodologies for obtaining evidence: (1) subpoena, (2) "D" order,
(3) general investigation, and (4) search warrant. The subpoena process operates just as in civil
proceedings but is not available as a tool in the initial stages of investigation in all states. For
example, local law enforcement in Pennsylvania may not issue a subpoena prior to filing a case.
The "D" order, also known as a specific and material facts order, allows law enforcement to
compel certain providers of "electronic communications" services and "remote computing"
services to turn over to law enforcement certain electronically stored information held by third

parties. For example, law enforcement could use a "D" order to acquire the identity of the person
who registered a particular nickname used on Yahoo! Of course, the general investigative record
not only creates a document trail but also provides a very reliable, trustworthy third party to
testify at a later date. The search warrant, however, is far and away the most effective tool that
law enforcement may use in a case. By using a search warrant, law enforcement can gain
immediate access to evidence in a quick, well-defined process that generally is not available in
any civil case. Once in possession of the warrant, the officer may then immediately and forcibly
obtain the evidence set forth in the warrant. Moreover, all that is necessary to obtain a warrant is
the officer's demonstration that it is more likely than not, under the totality of the circumstances,
that evidence of the crime or contraband can be found at the place to be searched. This provides
almost immediate access to evidence that would unlikely be obtained in a timely manner, if at all,
through civil process.
You are therefore left with the stark contrast between the two choices. If you do involve
law enforcement, you get access to direct, inexpensive methodologies for obtaining evidence. If
you choose the civil courts, you may still get the evidence, but the procedures are much more
burdensome. Nevertheless, there are still reasons to avoid handing the case directly over to law
enforcement. If you respond to the incident without involving law enforcement, you have much
greater control over the investigation. This point, in and of itself, is reason enough to avoid law
enforcement for some companies. You also may choose the civil lawsuit route to preserve
confidentiality. If a criminal action is filed, it is public. If, for example, you had a non-reportable
data theft, this could hurt your public image. Clearly, it is much better if you involve someone
with exacting knowledge of both criminal and civil procedures for investigating cybercrimes.

III.

RECOMMENDATION

Cyber criminals are turning increasing attention towards South-east Asia. In response,
South-east Asian governments are resorting to national, regional and international solutions to
fight cyber crime. However, they face problems including discrepancies in technical capability
and diverging legal systems. They must also be wary of internal political dissent exacerbating
cyber crime, and other specific regional and by-country vulnerabilities which can attract
potential cyber criminals.
With no boundaries to stop them, cybercriminals may strike anywhere in the world at any
time. While some nation-states may be taking affirmative actions to cooperate in the
investigation and prosecution of cybercrime, voter nations have taken a more lax approach to
prosecution of cybercrime activities outside their boundaries. This creates an immense threat to
businesses that depend upon their cyber-infrastructure for their very existence. You not only
should be aware of this threat but also must be cognizant of the proper way to seek redress of
cybercrime if your client becomes the latest victim.
The greatest common denominator in South-east Asia's vulnerability to cyber crime is the
region's overall lack of preparedness. Moreover, countries do not share parity in cyber crime
defences. Some are constrained by lax or outdated legal frameworks which cannot keep up with
cyber criminals' evolving methods:
Indonesia
Law on cyber crimes lags IT developments. Efforts to respond to cyber crime are focused
on amendments to the 1999 Telecommunications Act, but these can often only be made
retrospectively.
Thailand
Most cyber crime in Thailand is fraud, but increasing problems are intrusion (14%) and
data gathering (11%). The country is modestly defended: the International Security Management
System reports 59 public, state and private enterprises in Thailand have certification for
readiness against cyber attacks. In Japan, this figure is 4,152. Other countries have better
defences, but suffer internal difficulties in fighting cyber crime:
Malaysia
The country has generally effective cyber security systems. Cyber security is a growing
business in Malaysia, with 10% of local IT revenue and 30% of export IT derived from cyber
security products and services. However, the lack of a clear division between the public and
private spheres in cyber defence means government and business have blamed each other for
insufficient preparedness.
Philippines
The legal framework on cyber crime in the Philippines is in flux; in 2012, the Supreme
Court suspended the Cybercrime Prevention Act when legal rights groups claimed it was
unconstitutional because it violated freedom of expression. When the law was first promulgated
earlier that year government websites were heavily hacked in protest. The suspension was
renewed in 2013. In May 2013 the Department of Justice dropped some provisions of the law,
but popular protests against the law continue.

Military concerns. Efforts on civilian side will be bolstered by military initiatives:

Indonesia
The threat to Indonesia's lucrative natural resources sectors has prompted proposals to
include the defence ministry in cyber security. In early 2013 the Ministry of Defence proposed a
"cyber army" (drawn from navy, army and air force) to defend against cyber attacks. At present,
this function remains with the Ministry of Communications.
Philippines
The government has established a cyber crime unit within the Department of National
Defense and integrated this into the broader armed forces reform process. As South-east Asian
militaries become more adept at fighting cyber crime, they will be able to help their governments
to improve their cyber defences individually and in collaboration with other regional powers.

Economic Crimes in the Philippines, Its Causes and Effect

There are different study concerning Economic Crimes because of its wide coverage and
diverse interpretation among countries. Factors like poverty, ignorance, greediness and lack of
good governance are the possible contributors of the increasing issue on Economic crimes.
Economic crime can be an indication of dysfunction in the adaptation systems of the economy. In
other perspective, crimes towards the economy is in its own category is Economic Sabotage and
economic crimes is commonly categorized as White Collar Crime. Under White Collar Crimes
such as Corporate Crimes, environmental crimes and occupational crime can be also categorized
as economic crime. Economic crimes already exist in the middle age before people begun to
realize that it is already the crime. Economic crimes can be defined as any crime affecting the
economy of the country by any illegal means or crimes that involve money to operate illegally.
In the Philippines, diverse reasons and explanations how economic crimes evolve and
most of it states that it is manned by organized crime group and syndicated group. But the above
mentioned causes could also be the factor that we often ignore. I consider improper utilization
of political power relating to irresponsible governance and corrupt politicians influences
the rising problem on Economic crimes.
In 1992 Fidel Ramos was elected president for a 6-year term. He created the Presidential
Commission against Graft and Corruption (PCAGC) in 1994 to investigate violations of the antigraft laws by presidential appointees and appointed Eufemio Domingo as its chairman.
In 1997, Domingo lamented that the system is not working. We are not making it work . .
. We have all the laws, rules and regulations and especially institutions not only to curb, but to
eliminate, corruption. The problem is that these laws, rules and regulations are not being
faithfully implemented. . . . I am afraid that many people are accepting (corruption) as another
part of our way of life. Big-time grafters are lionised in society. They are invited to all sorts of
social events, elected and re-elected to government offices. It is considered an honour in fact a
social distinction to have them as guests in family and community affairs (Balgos, 1998: 267
268).
Another article states that political economy and public administration insight into the
effectiveness and efficiency of the government's efforts to boost production economic goods in
the Philippines. Public goods and policy has greater significance in rice productivity and growth
than inmost other commodities and services. Research and analysis that intensifies attention to
public sector governance as a crucial factor in the attainment of sustainable food security is thus
appropriate. (Tolentino, V Bruce J)
The country needs good political leaders at any aspect for the welfare of its people, not
only in the economic problem but also crime relating to the economy. Now days there are
another issue rising in the name of politics. Economic crimes begin when the state is manifested
by poor governance, misused of public funds, inefficient public icons and corrupt politicians.
Lets agree to disagree that poor governance leads to the increasing crime rate in the Philippines
and by mere corruption already constitute economic crime.
The dynamic boost of economy characterized by hastening globalization is another factor
why economic crime not only in the Philippines but also around the world is freely moving.
Globalization is the process of creating transnational markets, politics, and legal systems in order

to develop global economy. Economic globalization has served as a powerful force behind the
disintegrating of state-led economic models. But among developing countries we have not
necessarily seen the emergence of optimal modes of governance, which previously allowed
Newly Industrialized Countries (NICs) such South Korea and Taiwan to leapfrog to developed
world status. More than ever, what we need is a new model of governance, which could allow
emerging economies to progressively climb up the ladder of development. And this requires also
a shift in the mindset of the political leadership.
The connection of globalization to the economic crime is when a particular state is free
from the open trade cause by it; the opportunities for the economic crime may also arise. A
country that has booming economy might have of suffering economic sabotage. Economic
globalization has allowed us to discover development under weak, corrupt regimes, but also
detect the deleterious impact in the market. It supports the organized crime group and syndicated
group trade in the open gate of globalization. They also mention that transnational organization
was considered one of the causes of a serious danger to the countrys economy by means of
insurance fraud, fraud in payment of fuel taxes and corruption (Canadian Security Intelligence
Service).
Economic crime may come in many ways, especially in this modern time that is because
of its characteristic of being dynamic. It may also evolve to a more complex set of economic
crisis. The most commonly seen transnational organized crimes are money laundering; human
smuggling; cyber crime; and trafficking of humans, drugs, weapons, endangered species, body
parts, or nuclear material. And this can only be attained by use of globalization. Illicit activity
was recognized as common activities in transnational because they consider it as easy money.
Research shown that the integration of the European common market carve the path in
the free movement of exchanging goods, persons and services but also open exportation of
illegal items into the black market around the world affecting the economic status of each
country that characterized by a sophisticated modus operandi however their are efforts to
eliminate the elevating problem in transnational crime.
Now the problem arises to the law enforcement agency to prevent and locate the root
causes of this problem because only few were prosecuted. It could be the lapses from
implementing the laws and regulations pertaining to Cyber Crime or the laxity of the law
enforcement agency to provide evidence. Aside from that, the coordination among countries is
weakening by ignorance of each member to enforce the law. The effort of every nation must
intensify to provide enough penalties, proper dissemination of information through out the world
and coordination of treatise among countries in prosecuting suspected criminals. Together with
this, the need for establishing a particular agency in the Philippines in combating this kind of
crime must be required and connected in every region so that the centre of information may
focus only in a single data base.