The National Attorneys General Training & Research Institute

The National Attorneys General Training & Research Institute The National Attorneys General Training & Research Institute

Cybercrime Newsletter May 2018

The following is a compendium of news reports, case law and legislative actions over the latest bi-monthly period that may be of interest to our AG offices that are dealing with cyber-related issues. Neither the National Association of Attorneys General nor the National Attorneys General Training & Research Institute expresses a view as to the accuracy of news accounts, nor as to the position expounded by the authors of the hyperlinked articles.

Recent Cyber Developments

The Supreme Court dismissed U.S. v. Microsoft Corp. as moot and vacated the Second Circuit judgment under review. At issue was “whether, when the Government has obtained a warrant under 18 U.S.C. §2703, a U.S. provider of e-mail services must disclose to the Government electronic communications within its control even if the provider stores the communications abroad.” The Second Circuit held that this would be “an unauthorized extraterritorial application of §2703” and that Microsoft therefore did not have to provide information it stored in Ireland to comply with a §2703 warrant. After oral argument before the Court, Congress enacted the CLOUD Act, which requires service providers to disclose e-mails within its custody regardless of whether they are “located within or outside the United States.”

The Enforcement Division of the Texas State Securities Board issued a report of widespread fraud in cryptocurrency offerings found during their investigation of investments offered by 32 promoters who appeared to be illegally and fraudulently using online ads. Their investigation resulted in seven actions taken by the Securities Commissioner against such promoters.

The U.S. District Court for the Central District of California entered a default judgment against a man and ordered him to pay $6.45 million in damages after he was accused of spreading revenge porn. David Elam II was sued by his ex-girlfriend, listed as Jane Doe in legal filings, for online impersonation with intent to harm, stalking, copyright infringement and intentional infliction of emotional distress.

Onyekachi Opara, a Nigerian citizen, pled guilty to charges stemming from a global email scam in the U.S. District Court for the Southern District of New York. The scheme involved fraudulent emails sent to employees of various companies, purportedly from their supervisors or third party vendors, directing that funds be transferred to specified bank accounts. Opara was extradited to the U.S. by South African authorities.

The Seventh Circuit upheld the 27-year sentence and $1.67 million restitution order against Nigerian citizen Olayinka Sunmola, who victimized more than 50 women in an online dating scheme. U.S. v. Sunmola.

The U.S. District Court for the Eastern District of New York sentenced Dwayne Hans to three years in prison and ordered him to pay $134,000 in restitution for masterminding a series of online fraud schemes. Hans pleaded guilty to wire fraud and computer intrusion for attempting to defraud DOD and a financial institution.

The Pew Research Center released a study which found that although 88 percent of Americans feel the Internet has benefited them personally, the percentage of those who feel the Internet has been good for society has decreased from 76 percent in 2014 to 70 percent. The study also found that the way Americans access the Internet is changing, with 20 percent now accessing it only via their smartphone, a seven percent increase from 2014.

The Scientific Working Group on Digital Evidence posted four new drafts for public comment: 1) Best practices for computer forensic examination; 2) Best practices for digital evidence collection; 3) Best practices for image authentication; and 4) Vehicle make-model comparison form. All documents have a “View/Add Comments” link or comments may be emailed to secretary@swgde.org.

The European Union (EU) announced it would invest 1.5 billion euros ($1.83 million) in research into the use of artificial intelligence (AI) in transportation, health and other key sectors. The new Communication on Artificial Intelligence will also explore the data protection challenges and risks of AI use.

Financial services firms in the U.K. need to rethink their approach to combating cybercrime and “start thinking like criminals,” according to a new report, "Staying Ahead of Cyber Crime," by KPMG and UK Finance. The report also urged the firms to collaborate with law enforcement agencies and legislators in order to adapt to new threats.

A London high court ruled that Google must delist search results tied to the past criminal convictions of two businessmen that come up when searching for their names, often known as the right to be forgotten. The men had argued the convictions were not closely related to their current work. NT1 v. Google LLC.

State Cases of Interest

In State v. Maranger, an Ohio appellate court found that even assuming defendant’s girlfriend did not have actual authority to consent to the detective entering the residence and removing the computer, there was no error in finding she possessed the actual authority to do so, and the computer’s contents were not searched until after a warrant was obtained.

In State v. Williams, a Tennessee Court of Criminal Appeals affirmed, finding that the stop was supported by reasonable suspicion, so despite any texting by defendant, his substantial rights had not been adversely affected. AAG Andrew Coulam represented the State.

Federal Cases of Interest

In U.S. v. Beal, the 2nd Circuit affirmed defendant’s conviction for distribution, receipt and possession of child pornography because the searches fell within the particularized, authorized scope of the warrant as to the property to be seized and included the search of electronic data.

In U.S. v. Carroll, the 11th Circuit found the evidence proved that hundreds of images and videos of child pornography were manually downloaded and readily accessible while defendant had exclusive control over his computer.

Legislative Update

Kentucky Governor Matt Bevin signed HB 373 into law, which specifies that body- worn camera recordings are governed by the state open records act, and it also provides exceptions as to when a public agency may elect not to disclose such recordings.

Tennessee HB 1480, which prohibits the exclusion from a criminal trial of certain out-of-court statements made by a child under 12 years of age that describe a sexual act or physical violence directed against the child, became law.

Vermont Governor Phil Scott approved H. 615, which prohibits the use of drones near correctional facilities.

Cybercrime Initiatives in the Attorney General Community

Arkansas Attorney General Leslie Rutledge’s Cyber Crimes Unit separately arrested Brik Waggoner and James Hix, each of whom was charged with 30 counts related to online child pornography. Agents also seized multiple electronic devices from each arrestee’s residence.

California Attorney General Xavier Becerra announced that Carl Ferrer, CEO of Backpage.com, entered into a plea agreement in which he agreed to plead guilty to one count of conspiracy and three counts of money laundering; shut down Backpage.com worldwide; and make Backpage.com data available to law enforcement.

Massachusetts Attorney General Maura Healey kicked off the seventh annual National Cybercrime Conference for prosecutors, investigators and law enforcement.

New York Attorney General Eric Schneiderman launched the Virtual Markets Integrity Initiative, an inquiry into the policies and practices of platforms used to trade cryptocurrencies, such as Bitcoin and Ether. His Investor Protection Bureau sent letters to 13 such platforms seeking information in six major areas; the letters were signed by Simon Brandler, Senior Advisor and Special Counsel, and AAG John Castiglione.

South Dakota Attorney General Marty Jackley argued before the Supreme Court in South Dakota v. Wayfair, Inc., the suit filed by his office against three e-commerce companies who refused to comply with the imposition of state taxes on out-of-state purchases.

Wisconsin Attorney General Brad Schimel’s Internet Crimes Against Children Task Force and the Shorewood Police Department arrested Matthew Cullen-Williams, who allegedly created more than 16 fake social media accounts to harass a juvenile victim, forced that victim to have sexual relations and published sexually explicit images of that victim without the victim’s consent.


Hedda Litwin is the Editor of the Cybercrime Newsletter and may be reached at 202-326-6022. The Cybercrime Newsletter is a publication of the National Association of Attorneys General. Any use and/or copies of this newsletter in whole or part must include the customary bibliographic citation. NAAG retains copyright and all other intellectual property rights in the material. For content submissions or to contact the editor directly, please e-mail hlitwin@naag.org.

Faculty Spotlight

NAGTRI's faculty are top-rated experts in their field. Read about them.

Course Schedule

NAGTRI offers high-quality, responsive and innovative trainings.

Research & Newsletters

NAGTRI produces comprehensive research and newsletters on topical legal issues.