Path: utzoo!telecom-request Date: Tue, 11 Jun 91 10:29:55 -0700 From: Mark Seecof Newsgroups: comp.dcom.telecom Subject: Fighting Phone Hackers in SoCal Message-ID: Organization: TELECOM Digest Sender: Telecom@eecs.nwu.edu Approved: Telecom@eecs.nwu.edu X-Submissions-To: telecom@eecs.nwu.edu X-Administrivia-To: telecom-request@eecs.nwu.edu X-Telecom-Digest: Volume 11, Issue 453, Message 4 of 5 Lines: 121 Moderator's Note: Excerpts from an article published in the {Los Angeles Times} May 17, 1991; page E1. This was sent by Mark Seecof to RISKS, and Jody Kravitz passed ot along to me, to share with TELECOM Digest readers. Thanks Jody! Thanks, Mark! PAT] Edited and submitted to RISKS Digest by Mark Seecof of the L.A. Times Publishing Systems Department. [elisions and bracketed comments mine -- Mark S.] ``Little Phone Company on a Hacker Attack'' By Susan Christian, Times Staff Writer. [Introductory blather...] [...] in the last seven months [small long-distance company] Thrifty Tel's [security chief] has put seven hackers in jail. And she has made 48 others atone for their sins with hard cash and hardware. The case that [security chief] Bigley calls her biggest coup -- involving a 16-year-old Buena Park boy whose alleged theft of computer data cost Thrifty Tel millions of dollars -- is pending in Orange County Superior Court. Thrifty Tel has become one of the most agressive hacker fighters in California, according to Jim Smith, president of the California Assn. of Long Distance Telephone Cos. (Caltel). ``[Bigley] is tough,'' he says. ``I would not want to be a hacker on her network.'' So far, the company has collected more than $200,000 in penalties and reimbursements from hackers. ``We do not have a hacking problem any more because we stood up and punched them in the face,'' Bigley proclaims. ``These kids think that what they're doing is no big deal -- they're not murdering anyone,'' Bigley says. ``They think we're terrible for calling them on it. Their attitude is extremely arrogant. But these are not just kids having some fun. They are using their intellect to devise ways to steal. And these are not kids who need to steal. They come from white-collar families.'' For Thrifty Tel Inc., the battle of wits started a year ago. [...Thrifty Tel is ten years old, went public in '86, and serves 7,000 customers in SoCal.] [...Last year the hackers discovered them. Hackers use computer programs to try many possible code numbers until they find the ones which unlock the system.] ``The first quarter of 1990 we came in with a half-million-dollar net profit, and everything was going great,'' Bigley says. ``Then the next quarter, all of a sudden we were lopsided. We were getting bigger bills from our carriers than we were billing out to our customers.'' With a little investigation, the company pinpointed the culprits: hackers who were eating up telephone time at as much as ten hours a ``conversation.'' Because hackers exchange information and solve secret codes via long-distance modem connections, circumventing expensive telephone charges has become their mainstay. ``It was so frustrating to sit here and watch these hackers burn through our lines,'' says Bigley, a 33-year-old San Fernando Valley resident. She has been vice-president of operations at Thrifty Tel for four years. ``I had technicians out changing customers' codes that they'd just changed a few weeks before.'' But Bigley is not the sort to throw in the towel. [...She is hard-working and persistent.] First, she devoted a couple of months to educating herself about hacking. She monitored Thrifty Tel's computers for unusual activity -- telephone calls coming into the switching facility from non-customers. ``They believe that because they're sitting in a room with a computer they're safe,'' Bigley says. ``The problem is, they're using their telephone; we can watch them in the act. It's a lot easier to catch a hacker than a bank robber.'' Bigley started making a few calls of her own. If the infiltrator seemed major league, like the Buena Park boy, she contacted the Garden Grove Police Department, whose fraud investigators went into homes with search warrants. If the hacker seemed relatively small, however, Bigley took matters into her own hands, telephoned the suspect and presented an ultimatum: Either pay up or face criminal charges. A non-negotiable condition of Bigley's out-of-court settlement provided that the guilty party relinquish his (or, infrequently, her) computer and modem. Thrifty Tel donates the confiscated weapons [computers] to law enforcement agencies. Teen-age hackers tend to be ``very intelligent and somewhat introverted,'' says Garden Grove Police Detective Richard Harrison, a fraud investigator who has arrested many of Thrifty Tel's suspects. Most of the parents he has dealt with were oblivious to their children's secret lives, Harrison says. He suggests that parents educate themselves about their children's computers. ``If a kid is spending a whole bunch of time on his computer and it's hooked up to a modem, he's not just running his software. What is he doing on that computer? Does he really need a modem?'' [ed. note -- this officer may be an expert on fraud but is clearly unqualified to make such sweeping assertions about what (young) people do with computers. Playing rogue can eat up as much time as hacking while the modem remains idle.] Not all hackers are young computer fanatics testing their limits. ``The hacking problem is two-fold,'' says Caltel president Smith, also president of the Sacramento-based long-distance telephone company Execuline. ``First, we have Information Age fraud, which is an outgrowth of the proliferation of computers in households. We have all these kids who want to talk to each other on bulletin boards, and if mom and dad had to pay for all those phone calls, the cost would be prohibitive. Then we have professional fraud -- adults as well as kids who attempt to gain access to our codes for the purpose of selling the codes. They have made a big business out of hacking.'' Smith's company has waged a more low-key defens[e] against hackers than Thrifty Tel. ``I wish I had the time to devote to hacker fraud that she [Bigley] has been able to devote,'' he says. Therein lies the reason that many telephone companies decline to file charges against hackers, says Roy Costello, a fraud investigator for GTE. ``Smaller carriers don't have the time to allow their people to do the investigation and then carry it through the court system,'' he says. [... Stuff about the sticktoitiveness of Thrifty Tel's Bigley and how she thinks that hackers are immoral and wants to defeat them.]