September 2023 Business Finance Assignment
Read Case 2.1: Hacking into Harvard, located on page 71 in your textbook. As applicants began to defend themselves against the penalties handed out by the business schools, they appealed to both consequentialist and nonconsequentialist criteria to support their actions. Some responded by pointing out that their intentions were never malicious, while others argued they did not think checking their application statuses would cause any real harm. Review the case study and analyze the actions of the students from a Kantian perspective. Consider whether the actions taken by the hackers were permissible according the standard of universal acceptability.
CASE 2.1 Hacking into Harvard EVERYONE WHO HAS EVER APPLIED FOR ADMISSION to a selective college or who has been interviewed for a highly desired job knows the feeling of waiting impatiently to learn the result of one’s application. So it’s not hard to identify with those applicants to some of the nation’s most prestigious MBA programs who thought they had a chance to get an early glimpse at whether their ambition was to be fulfilled. While visiting a Businessweek Online message board, they found instructions, posted by an anonymous hacker, explaining how to find out what admission decision the business schools had made in their case. Doing so wasn’t hard. The universities in question—Harvard, Dartmouth, Duke, Carnegie Mellon, MIT, and Stanford—used the same application software from Apply Yourself, Inc. Essentially, all one had to do was change the very end of the applicant-specific URL to get to the supposedly restricted page containing the verdict on one’s application. In the nine hours it took Apply Yourself programmers to patch the security flaw after it was posted, curiosity got the better of about two hundred applicants, who couldn’t resist the temptation to discover whether they had been admitted.19 Some of them got only blank screens. But others learned that they had been tentatively accepted or tentatively rejected. What they didn’t count on, however, were two things: first, that it wouldn’t take the business schools long to learn what had happened and who had done it and, second, that the schools in question were going to be very unhappy about it. Harvard was perhaps the most outspoken. Kim B. Clark, dean of the business school, said, “This behavior is unethical at best—a serious breach of trust that cannot be countered by rationalization.” In a similar vein, Steve Nelson, the executive director of Harvard’s MBA program, stated, “Hacking into a system in this manner is unethical and also contrary to the behavior we expect of leaders we aspire to develop.” It didn’t take Harvard long to make up its mind what to do about it. It rejected all 119 applicants who had attempted to access the information. In an official statement, Dean Clark wrote that the mission of the Harvard Business School “is to educate principled leaders who make a difference in the world. To achieve that, a person must have many skills and qualities, including the highest standards of integrity, sound judgment and a strong moral compass—an intuitive sense of what is right and wrong. Those who have hacked into this web site have failed to pass that test.” Carnegie Mellon and MIT quickly followed suit. By rejecting the ethically challenged, said Richard L. Schmalensee, dean of MIT’s Sloan School of Management, the schools are trying to “send a message to society as a whole that we are attempting to produce people that when they go out into the world, they will behave ethically.” Duke and Dartmouth, where only a handful of students gained access to their files, said they would take a case-by-case approach and didn’t publicly announce their individualized determinations. But, given the competition for places in their MBA programs, it’s a safe bet that few, if any, offending applicants were sitting in classrooms the following semester. Forty-two applicants attempted to learn their results early at Stanford, which took a different tack. It invited the accused hackers to explain themselves in writing. “In the best case, what has been demonstrated here is a lack of judgment; in the worst case, a lack of integrity,” said Derrick Bolton, Stanford’s director of MBA admissions. “One of the things we try to teach at business schools is making good decisions and taking responsibility for your actions.” Six weeks later, however, the dean of Stanford Business School, Robert Joss, reported, “None of those who gained unauthorized access was able to explain his or her actions to our satisfaction.” He added that he hoped the applicants “might learn from their experience.” Given the public’s concern over the wave of corporate scandals in recent years and its growing interest in corporate social responsibility, business writers and other media commentators warmly welcomed Harvard’s decisive response. But soon there was some sniping at the decision by those claiming that Harvard and the other business schools had overreacted. Although 70 percent of Harvard’s MBA students approved the decision, the undergraduate student newspaper, The Crimson, was skeptical. “HBS [Harvard Business School] has scored a media victory with its hard-line stance,” it said in an editorial. “Americans have been looking for a sign from the business community, particularly its leading educational institutions, that business ethics are a priority. HBS’s false bravado has given them one, leaving 119 victims in angry hands.” As some critics pointed out, Harvard’s stance overlooked the possibility that the hacker might have been a spouse or a parent who had access to the applicant’s password and personal identification number. In fact, one applicant said that this had happened to him. His wife found the instructions at Businessweek Online and tried to check on the success of his application. “I’m really distraught over this,” he said. “My wife is tearing her hair out.” To this, Harvard’s Dean Clark responds, “We expect applicants to be personally responsible for the access to the website, and for the identification and passwords they receive.” Critics also reject the idea that the offending applicants were “hackers.” After all, they used their own personal identification and passwords to log on legitimately; all they did was to modify the URL to go to a different page. They couldn’t change anything in their files or view anyone else’s information. In fact, some critics blamed the business schools and Apply Yourself more than they did the applicants. If those pages were supposed to be restricted, then it shouldn’t have been so easy to find one’s way to them. In an interview, one of the Harvard applicants said that although he now sees that what he did was wrong, he wasn’t thinking about that at the time—he just followed the hacker’s posted instructions out of curiosity. He didn’t consider what he did to be “hacking,” because any novice could have done the same thing. “I’m not an IT person by any stretch of the imagination,” he said. “I’m not even a great typist.” He wrote the university a letter of apology. “I admitted that I got curious and had a lapse in judgment,” he said. “I pointed out that I wasn’t trying to harm anyone and wasn’t trying to get an advantage over anyone.” Another applicant said that he knew he had made a poor judgment but he was offended by having his ethics called into question. “I had no idea that they would have considered this a big deal.” And some of those posting messages at Businessweek Online and other MBA-related sites believe the offending applicants should be applauded. “Exploiting weaknesses is what good business is all about. Why would they ding you?” wrote one anonymous poster. Dean Schmalensee of MIT, however, defends Harvard and MIT’s automatically rejecting everyone who peeked “because it wasn’t an impulsive mistake.” “The instructions are reasonably elaborate,” he said. “You didn’t need a degree in computer science, but this clearly involved effort. You couldn’t do this casually without knowing that you were doing something wrong. We ’ve always taken eth ics seriously, and this is a serious matter.” To those applicants who say that they didn’t do any harm, Schmalensee replies, “Is there nothing wrong with going through files just because you can?” To him and others, seeking unauthorized access to restricted pages is as wrong as snooping through your boss’s desk to see whether you’ve been recommended for a raise. Some commentators, however, suggest there may be a generation gap here. Students who grew up with the Internet, they say, tend to see it as wide-open territory and don’t view this level of web snooping as indicating a character flaw.
Email Hacking Is A Serious Crime
POSTED IN PRIVACY LAW BY LAWYERS.COMSM
Practically everyone has an email account, and they’re used for personal and business reasons. It’s only natural for us to expect a little privacy in our email, and there are all sorts of federal and state laws protecting that privacy.
A case involving former Governor Sarah Palin shows how serious it can be to break these laws and hack into someone else’s email account.
In April 2010, David Kernell went on trial for “hacking” into then-Alaskan Governor Sarah Palin’s personal email account.
In 2008, John McCain was the Republican party’s candidate for president. Sarah Palin was the Governor of Alaska and McCain’s vice-presidential running mate. David Kernell, the son of a Tennessee state lawmaker, was a student at the University of Tennessee.
At this time, it’s claimed Kernell wanted to “derail” Palin’s campaign, and he gained access or “hacked” into Palin’s personal Yahoo email account. He apparently changed the password and posted personal information he found in the emails on a website. He also posted the password so others could access the account.
Kernell was indicted – meaning a grand jury thought there was enough evidence to put him on trial – on several federal charges. A jury convicted him of only two charges. He was sentenced to one year and one day in federal prison.
The jury didn’t buy Kernell’s defense that it was all just a prank.
Kernell’s case shows the types of crimes an email hacker may face. He was charged with four very serious felony crimes:
In simple terms, wire fraud involves using a computer, radio, television, or telephone to get money or property from someone else through trickery or deception. Although taking money is a common example – such as through various internet scams – stealing personal and confidential information qualifies as wire fraud, too.
One of the keys to wire fraud is that the emails, telephone calls, or wire transmissions have to pass between two or more states or countries.
It was claimed that Kernell used an old computer in Tennessee to hack into Palin’s email account, which, presumably, was based in Alaska. Once in, he took personal information, such as email addresses and telephone numbers, and posted them online.
Kernell was not convicted of this crime.
Computer fraud isn’t much different than wire fraud, except this crime applies only to computers, as opposed to telephones and radios, and it also requires some sort of interstate connection. However, the law applies only to computers used:
1. By or for financial institutions, like banks, or the US Government
2. In such a way that the computer impacts interstate or foreign commerce or communication of the US
Presumably, Palin’s connection to the federal election and Senator McCain brought the federal computer fraud law into play. Kernell was convicted of unauthorized access to a protected computer, which falls under computer fraud.
Identity theft is when someone uses fraud, deception, or trickery to get and use another person’s personal information. Usually, the information is used by the thief to make money, but money doesn’t have to be involved.
In Kernell’s case, once Palin selected the email address, “[email protected],” it became her own, unique address and no one else could use it. When Kernell accessed and used that email account he gained access to personal information, such as family email addresses, family pictures, birth dates of Palin and family members and pictures of Palin’s family members.
This information was posted online as part of Kernell’s plot to derail Palin’s vice-presidential bid.
Kernnel was not convicted of this crime.
Obstruction of Justice
Obstruction of justice covers many things, but it typically means interfering with some legal process or investigation. Kernell was charged with this crime because it was claimed he tried to erase evidence of his hacking activities from his computer before federal investigators could retrieve it.
Kennel was convicted of this crime.
Someone in Kernell’s position could face other criminal charges and non-criminal (or “civil”) lawsuits, too. The federal government doesn’t have to get involved, either.
For example, in most states, there are criminal and civil identity theft laws. In addition, in some states, like Virginia, it’s an invasion of privacy to look at someone’s personal information, and it’s a crime. In many states, like Maryland, accessing and telling the world about another person’s personal information is an invasion of privacy that may make the hacker liable for money damages to the victim.
Even if, as it was claimed Kernell’s case, the email hacking was a “prank,” the hacker could still be charged with less serious crimes (called misdemeanors) and face several months in jail, thousands of dollars in fines or both.
Hacking is indeed a serious crime. If you’re thinking about doing it, even as a joke, you should think again.
Questions for Your Attorney
1. What’s the first thing I should do if I think someone has hacked into my email account?
2. Is it a crime if I look at my spouse’s email account without permission?
3. If my child uses my computer to commit a crime, can the authorities take my computer and search anything on it, including my personal files and data?
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