Law stretched by computer fraud

Press, 7 June 1983, Page 31

Law stretched by computer fraud

The opportunities for computer fraud and other farms of abuse have increased with the growth of technology and the law was now stretched to the limit of its ability to cope, a seminar on computer crime was told last week. The Wellington seminar, the first of its kind in New Zealand, was organised by International Computers, Ltd, and was attended by senior executives from both the private and public sectors. Mr John Lenart, a lecturer in business law at .Massey University, said revision of the law as it related to computer fraud was a matter of urgent consideration. Fraud could occur at any of the stages of computer operation. The Crimes Act 1961, despite its amendments, was not equipped to cope.

"If you copy somebody's program, you haven’t stolen it ... he’s still got it. How do you prosecute for theft when the owner still has the original? In some cases the owner may not be aware that the program has been copied.” Dr Colin Boswell, director of the computer service centre at Victoria University of Wellington and president of the New Zealand Computer Society, said the United States Chamber of Commerce estimated the annual loss from computer related crime at ?100M, but other experts said it could be higher. While losses from “ordinary” embezzlements were of the order of tens of thousands of dollars, those from computer crimes in the United States were generally 10 times that figure. He said computer crimes were most likely to be com-

mitted by programmers, who stood a better-than-average chance of success because they covered their tracks more successfully. Dr Boswell said high quality audit and controls were required to prevent computer-assisted embezzlement. Controls to prevent the theft of computer resources were easier to implement. Detective-Sergeant Harry Quinn, of the Wellington fraud squad, echoed this call for stricter security and closer supervision. He said that between 40 and 45 per cent of reported crime was fraud related and a high proportion of such offences against companies were committed by trusted employees who had worked for the organisation for years. White-collar crime was making inroads into every level of society and business in New Zealand.