Freeh proposed ban on unbreakable crypto floated as draft bill

Message one: news report on bill
Message two: some excerpts from the proposal
Message three: upcoming schedule in Congress

From owner-cypherpunks@cyberpass.net Fri Sep  5 20:39:58 1997
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Date: Fri, 05 Sep 1997 20:39:58 -0400
To: cypherpunks@toad.com
From: John Young 
Subject: New GAK Bill 
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5 September 1997, MSNBC:


FBI Director Louis Freeh floats a new proposal at a congressional 
hearing to outlaw non-breakable crypto products.

A radical shift in crypto debate

Proposed bill outlaws non-crackable crypto products, restrict imports

By Brock N. Meeks, MSNBC

WASHINGTON -- The White House would likely be very sympathetic to a
controversial new bill that would outlaw all encryption software that 
doesn't allow law enforcement agencies to immediately decode scrambled 
messages, an administration official told MSNBC.

The new bill, still in draft form, is quietly circulating among members 
of the House and Senate. Although the administration hasn't formally 
endorsed any provisions of the bill, MSNBC has learned that the White 
House has been providing what is called technical drafting assistance
to members of Congress writing the bill. William Reinsch, the Commerce 
Department undersecretary for export administration, confirmed the White 
House involvement for MSNBC on Thursday night.

The draft bill was already in the hands of some members of the Senate's 
Subcommittee on Technology, Terrorism and Government Regulation when FBI 
Director Louis Freeh outlined its basic provisions while testifying before
the panel Wednesday. Freeh said "we would recommend" that legislation be 
written requiring all encryption software or services made in or imported 
to the United States to have a feature "which would allow for the immediate, 
lawful decryption" of any scrambled messages used for illegal purposes or 
in a national security matter.
                           
NATION AT RISK?

The White House, FBI and intelligence agencies claim that the proliferation 
of unbreakable encryption products puts the nation at risk. Criminals and 
terrorists are increasingly using unbreakable encryption products, Freeh
testified Wednesday. 

U.S. makers of encryption software claim that any government-mandated decoding 
features would make their products unacceptable to clients in the global 
marketplace. The new proposals outlined by Freeh also drew the ire of civil
liberties groups, which fear that any government controls on encryption 
products raise serious First Amendment and privacy concerns.

Placing such government-mandated controls on the domestic use and manufacture 
of encryption software, as well as on the import of encryption products, 
stands in marked contrast to current White House crypto policies. Currently,
the United States places strict regulations on the export of any encryption 
products that do make decoding keys available to law enforcement agencies. 
However, the administration has steadfastly maintained throughout the often
contentious public debate over encryption policies that it would not place 
any restrictions on the domestic use of encryption software, nor would it
restrict the import of encryption products. 

Despite Freeh's testimony and the draft legislation written with White House 
assistance, Reinsch said the administration's policy on encryption hasn't 
changed. "I want to emphasize that [in providing drafting assistance] we are
responding to committee requests," he said. "And those requests have been 
fairly directive, such as: 'Give us some examples of how we can better 
accommodate law enforcement needs.' " 

Currently, the White House is backing an encryption bill in the Senate called 
the Secure Public Networks Act, also known as S. 909. This bill would 
encourage the use of and set up guidelines for encryption software products 
with decoding keys. Under this plan, all coded messages would spin off a 
decoding key that would be stored with a government-approved third party. 
Law enforcement agencies, foreign or domestic, would be allowed access to 
those keys if they obtained a court-ordered warrant. The bill would not 
restrict or require any encryption software used in the United States, or 
restrict the import of any foreign crypto products. 

However, MSNBC has learned that the draft bill now circulating among members 
of the House and Senate specifically outlaws the "manufacture, distribution 
or import" of any encryption software product or communication device that 
does not "allow the immediate decryption" of all scrambled messages or 
communications "if used for illegal purposes." The bill also targets 
"network services," such as Internet Service Providers, that provide 
encryption capabilities to their clients.
                           
BAN WOULD GO INTO EFFECT IN 1999

Under this proposed bill, if such encryption services are offered by a 
company like ISP, the service provider must build in a provision to allow
for immediate decryption of any scrambled messages, according to several 
sources that have seen the draft language. The software ban would
go into effect in January 1999.

Reinsch told MSNBC he wasn't sure that Freeh's testimony "accurately 
reflected" the language the White House offered in its technica
drafting for congressional committees. However, he indicated the 
administration was interested in Freeh's proposal.

"I'll be blunt about it," Reinsch said. If such a bill were approved by a 
congressional committee, the administration "would look very seriously at 
it and I imagine we would be very sympathetic to it," he said.

Opponents of proposals to require key for all encryption software blanched 
at Freeh's statements. "This proposal crosses a line that hasn't been 
crossed before in the area of domestic controls on crypto," said Alan
Davidson, policy analyst for the Center for Democracy and Technology. 
Davidson said a government mandate to provide immediate decryption 
capabilities would be like "forcing everyone to live in a glass house."
It also "trashes the Fourth Amendment," which guarantees a right to be 
protected from unlawful search and seizure, Davidson said.

Freeh told the Senate panel Wednesday that he isn't looking to expand law 
enforcement's investigative powers. Rather, he said, he is only looking for 
a "Fourth Amendment that works in the Information Age."
                            
------

From owner-fight-censorship-announce@vorlon.mit.edu Fri Sep  5 19:46:55 1997
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Date: Fri, 5 Sep 1997 19:46:55 -0700 (PDT)
From: Declan McCullagh 
To: fight-censorship-announce@vorlon.mit.edu
Subject: FC: Mandatory key escrow bill text, backed by FBI
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All encryption products distributed in or imported into the U.S. after
January 1, 1999 must have a key escrow backdoor for the government,
according to an FBI-backed proposal circulating on Capitol Hill. The
measure would impose a similar requirement on "public network service
providers" that offer data-scrambling services. FBI Director Louis Freeh
talked about this proposal, without disclosing legislation existed, at a
Senate subcommittee haring on Wednesday.

Domestic use and sale of encryption has never been regulated.

Attached is an excerpt from the draft "Secure Public Networks Act" dated
August 28.

-Declan

-------

	SEC. 105. PUBLIC ENCRYPTION PRODUCTS AND SERVICES

	(a) As of January 1, 1999, public network service
	providers offering encryption products or encryption
	services shall ensure that such products or services
	enable the immediate decryption of communications or
	electronic information encrypted by such products or
	services on the public network, upon receipt of a court
	order, warrant, or certification, pursuant to section
	106, without the knowledge or cooperation of the person
	using such encryption products or services.

	(b) As of January 1, 1999, it shall be unlawful for any
	person to manufacture for sale or distribution within
	the U.S., distribute within the U.S., sell within the
	U.S., or import into the U.S., any product that can be
	used to encrypt communications or electronic
	information, unless that product:

  	 (1) includes features, such as key recovery, trusted 
	 third party compatibility or other means, that

	  (A) permit immediate decryption upon receipt of
	  decryption information by an authorized party without
	  the knowledge or cooperation of the person using such
	  encryption product; and

	  (B) is either enabled at the time of manufacture,
	  distribution, sale, or import, or may be enabled by the
	  purchase or end user; or

	 (2) can be used only on systems or networks that include
	 features, such as key recovery, trusted third party
	 compatibility or other means, that permit immediate
	 decryption by an authorized party without the knowledge
	 or cooperation of the person using such encryption
	 product.

	(c) (1) Within 180 days of the enactment of this Act,
	the Attorney General shall publish in the Federal
	Register functional criteria for complying with the
	decryption requirements set forth in this section.

	(2) Within 180 days of the enactment of this Act, the
	Attorney General shall promulgate procedures by which
	data network service providers sand encryption product
	manufacturers, sellers, re-sellers, distributors, and
	importers may obtain advisory opinions as to whether a
	decryption method will meet the requirements of this
	section.

	(3) Nothing in this Act or any other law shall be
	construed as requiring the implementation of any
	particular decryption method in order to satisfy the
	requirements of paragrpahs (a) or (b) of this section.

-------

MSNBC's Brock Meeks on above FBI proposal & White House support:
  http://www.msnbc.com/news/108020.asp

My report on the September 3 "mandatory key escrow" Senate hearing:
  http://jya.com/declan6.htm

Transcript of FBI director Louis Freeh's remarks at Sep 3 hearing:
  http://jya.com/fbi-gak.txt

Reuters' Aaron Pressman on Commerce Dept backing away from FBI:
  http://www.pathfinder.com/net/latest/RB/1997Sep05/248.html

-------



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From owner-cypherpunks@cyberpass.net Sat Sep  6 09:22:58 1997
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Date: Sat, 6 Sep 1997 09:22:58 -0700 (PDT)
From: Declan McCullagh 
To: John Young 
cc: cypherpunks@toad.com
Subject: Re: Crypto Hearings
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In my post "Mandatory key escrow bill text" yesterday evening I included a
URL to a Reuters dispatch about the SAFE hearing on Sep 4. I also
forwarded the article to f-c, not sure about cypherpunks. 

The Sep 4 SAFE hearing seems to have been much more balanced than the
Senate one the day before. I don't have a transcript of it, though. 

Beware the National Security committee markup and vote on SAFE next week.
Mandatory key escrow is only one card the government has to play.

-Declan



On Sat, 6 Sep 1997, John Young wrote:

> Declan, or anyone, are there any transcipts of this SAFE hearing,
> or news reports, or other documents:
> 
> September 4, 1997
> 
> SECURITY AND FREEDOM THROUGH ENCRYPTION ACT
> 
> Committee on Commerce: Subcommittee on Telecommunications, Trade, and 
> Consumer Protection held a hearing on H.R. 695, Security and Freedom 
> Through encryption (SAFE) Act. Testimony was heard from Representatives 
> Goodlatte and Lofgren; William P. Cowell, Deputy Director, NSA, 
> Department of Defense; William A. Reinsch, Under Secretary, Export 
> Administration, Department of Commerce; Robert S. Litt, Deputy 
> Assistant Attorney General, Criminal Division, Department of Justice; 
> and public witnesses.
> 
> -----------------------------------------------------------------------
> 
> And for these of the coming week:
> 
> Congressional Record: September 5, 1997 (Digest):
>  
>                       CONGRESSIONAL PROGRAM AHEAD
> 
>                   Week of September 8 through 13, 1997
> 
> [Excerpts]
>                            House Committees
> 
>   Committee on National Security, September 9, to markup H.R. 695, 
> Security and Freedom Through Encryption (SAFE) Act, 1 p.m., 2118 
> Rayburn.
> 
>   Permanent Select Committee on Intelligence, September 9, 
> executive, hearing on Encryption legislation, 10 a.m., H-405 
> Capitol.
>   September 11, executive, to markup Encryption legislation, 10 
> a.m., H-405 Capitol.
> 
>   Committee on Science, September 10, hearing on Next Generation 
> Internet Initiative, 10 a.m., 2318 Rayburn.
> 
>   September 11, Subcommittee on Courts and Intellectual Property, 
> hearing on H.R. 2265, No Electronic Theft (NET) Act, and also on 
> electronic copyright piracy, 10 a.m., 2237 Rayburn.
> 
>   September 11, Subcommittee on Crime, hearing regarding cellular 
> telephone fraud, 9:30 a.m., 2141 Rayburn.
> 
>                            Senate Committees
> 
>   Select Committee on Intelligence: September 10, to hold a closed 
> briefing on intelligence matters, 2:30 p.m., SH-219.
> 
>   Committee on Labor and Human Resources: September 11, to hold 
> hearings to examine the confidentiality of medical information, 10 
> a.m., SD-430.
> 
> 
> 
> 
> 
>