[council] FTC Statement as presented at the GAC/GNSO meeting - Monday 26 June 2006

Bruce Tonkin Bruce.Tonkin at melbourneit.com.au
Tue Jun 27 18:11:03 UTC 2006

Hello All,

Attached is a copy of the presentation from Jon Leibowitz in the
GAC/GNSO session on WHOIS on Monday 26 June 2006.

I have attempted to provide a plain text version below.  Note I have not
included the footnotes.


Prepared Statement of the Federal Trade Commission
before the 
Internet Corporation for Assigned Names and Numbers ("ICANN") 

Meeting Concerning Whois Databases 
Marrakech, Morocco
June 2006

I. Introduction 

Good morning. I am pleased to have this opportunity to speak here today
about Whois 
databases. I am Jon Leibowitz, one of five Commissioners of the United
States Federal Trade 
Commission ("FTC" or "Commission") in Washington, D.C. The FTC is an
federal agency of the United States government, the lead agency charged
with protecting 
Americans' privacy, and the only agency in the United States empowered
to enforce both 
competition and consumer protection laws. 

The FTC believes that the Whois databases, despite their limitations,
are nevertheless 
critical to the agency's consumer protection mission, to other law
enforcement agencies around 
the world, and to consumers. The use of these databases to protect
consumers is at risk as a 
result of the Generic Names Supporting Organization's ("GNSO") recent
vote to define the 
purpose of Whois data as technical only. The FTC is concerned that any
attempt to limit Whois 
to this narrow purpose will put its ability to protect consumers and
their privacy in peril. 

The principal consumer protection statute that the FTC enforces is the
FTC Act, which 
prohibits "unfair or deceptive acts or practices." The FTC Act
authorizes the FTC to stop 
businesses engaged in such practices. The FTC also can seek monetary
redress and other 
equitable remedies for consumers injured by these illegal practices. The
FTC is a civil law 
enforcement agency without criminal authority. 

The FTC has used its authority against "unfair or deceptive acts or
practices" to take 
action against a wide variety of Internet-related threats, including
Internet auction fraud, 
Internet-based pyramid schemes, websites making deceptive health claims,
and websites 
promoting "get rich quick" schemes. More recently, the Commission has
focused its actions 
against deceptive claims delivered through spam, "phishing" schemes, and
spyware. In many 
of these cases, the FTC has worked cooperatively with its consumer
protection counterparts 
across the globe. The FTC's goal in bringing these cases has been to
help ensure that consumers 
are free from deceptive practices that undermine the promise of the

In addition, the FTC has made a high priority of protecting consumers'
privacy and 
improving the security of their sensitive personal information, both
online and offline. The FTC 
has brought several law enforcement actions targeting unfair and
deceptive practices that involve 
the failure to protect consumers' personal information. Indeed, the FTC
recently created a new 
Division of Privacy and Identity Protection to address specifically the
need to protect consumer 
privacy and the security of consumers' personal information. 

The FTC also promotes consumer welfare in the electronic marketplace
education, outreach, and advocacy. For example, FTC staff provides
guidance to businesses 
advertising and marketing on the Internet. FTC staff educates consumers
about what they 
should look for before making purchases and providing information
online. The Commission 
also advocates before legislative bodies; on several recent occasions,
for example, the 
Commission has testified before Congress on protecting consumer privacy
and data security.

This statement addresses the importance of public Whois databases in
consumer protection laws and in empowering consumers. It describes how
the FTC uses Whois 
databases for its law enforcement purposes, discusses the importance of
consumer access to 
Whois data about commercial websites and other legitimate uses of Whois
data, addresses the 
privacy concerns that some stakeholders have raised about public access
to Whois databases, and 
concludes with some of the FTC's recommendations on how to move forward.

II. How the FTC Uses Whois Databases

FTC investigators and attorneys have used Whois databases for the past
decade in 
multiple Internet investigations. Whois databases often are one of the
first tools FTC 
investigators use to identify wrongdoers. Indeed, it is difficult to
overstate the importance of 
quickly accessible Whois data to FTC investigations. 

For example, in the FTC's first spyware case, FTC v. Seismic
Entertainment, the 
Commission alleged that the defendants exploited a known vulnerability
in the Internet Explorer 
browser to download spyware to users' computers without their knowledge.
The FTC alleged 
that the defendants' software hijacked consumers' home pages, resulted
in an incessant stream of 
pop-up ads, allowed the secret installation of additional software
programs, and caused 
computers to slow down severely or crash. The software in this case was
installed using so-
called "drive-by" tactics - exploiting vulnerabilities to install
software onto users' computers 
without any notice. Using Whois data, the FTC found the defendants,
stopped their illegal 
conduct, and obtained a judgment for millions of dollars in consumer
redress. It is uncertain 
whether the FTC would have been able to locate the defendants without
the Whois data. 

In another matter, the FTC cracked down on companies that illegally
exposed unwitting 
consumers to graphic sexual content without warning. The Commission
charged seven entities 
with violating federal laws that require warning labels on e-mail
containing sexually-explicit 
content. In these cases, accurate Whois information helped the FTC to
identify the operators of 
websites that were promoted by the illegal spam messages. 

Information in Whois databases is most useful when it is accurate.
Indeed, the 
Commission has advocated that stakeholders work to improve the accuracy
of such information, 
because inaccurate data has posed significant obstacles in FTC

In some instances, though, even inaccurate Whois information can be
useful in tracking 
down Internet fraud operators. One of the FTC's recent spyware cases
involved defendants that 
used free lyric files, browser upgrades, and ring tones to trick
consumers into downloading 
spyware on their computers.18 Rather than receiving what they opted to
download, consumers 
instead received spyware with code that tracked their activities on the
Internet. In this particular 
investigation, several of the defendants' websites were registered to a
non-existent company 
located at a non-existent address. Despite the registrant's use of false
information, FTC staff 
was able to link the websites to each other because all of the
registrations listed the same phony 
name as the administrative contact in the Whois databases. Of course,
with a "narrow purpose" 
Whois, not even such inaccurate registration information would be

Having "real-time" access to Whois data is particularly important for a
civil law 
enforcement agency like the FTC. Where a registrar is located in a
foreign jurisdiction, the FTC 
often has no other way to obtain the information it needs. The FTC
cannot, in most cases, 
readily require a foreign entity to provide us with information. Thus,
particularly in cross-border 
cases, Whois databases are often the primary source of information
available to the FTC about 
fraudulent domain name registrants.

In short, if ICANN restricts the use of Whois data to technical purposes
only, it will 
greatly impair the FTC's ability to identify Internet malefactors
quickly - and ultimately stop 
perpetrators of fraud, spam, and spyware from infecting consumers'
III. How Consumers Use Whois Databases 

Consumers also benefit from access to Whois data for commercial
websites. Where a 
website does not contain contact information, consumers can go to the
Whois databases and find 
out who is operating the website. This can help consumers resolve
problems with online 
merchants directly, without the intervention of law enforcement

Consumers do in fact regularly rely on Whois databases to identify the
entities behind 
websites. FTC staff recently searched the FTC's database of consumer
complaints, and found a 
significant number of references to the term "Whois." These results
indicate that when 
consumers encounter problems online, the Whois databases are a valuable
initial tool they use to 
identify with whom they are dealing. Consumer access to Whois also helps
the FTC because it 
allows consumers to gather valuable contact information that they can
pass on to the FTC - 
information that might no longer be available by the time the agency
initiates an investigation 
because the website operators have moved on to different scams. 

The Organization for Economic Cooperation and Development ("OECD") has 
recognized that consumer access to Whois data about commercial websites
serves an important 
public policy interest. In 2003, the OECD Committee on Consumer Policy
issued a paper 
unequivocally stating that "[f]or commercial registrants, all contact
data should be accurate and 
publicly available via WHOIS." In support of this conclusion, the paper

"Easy identification of online businesses is a key element for building
trust in the electronic marketplace. Because a Web site has no obvious
presence, consumers are deprived of many of the usual identifying
that help instil trust in a traditional retailer . . . While the most
obvious location 
for an online business to provide contact details is on the Web site
itself, domain 
name registration information can serve as a useful compliment [sic]."

This OECD paper represents an international consensus about the
importance of Whois 
data for consumers. 

IV. Other Legitimate Uses of Whois Data 

There are other legitimate private users of Whois databases whose views
and concerns 
should be reflected in the Whois policy development process at ICANN.
These are businesses, 
financial institutions, non-governmental organizations, and intellectual
property rights owners, 
all of which heavily rely on access to accurate Whois data. Although the
FTC does not represent 
these entities' interests in the Whois debate, their use of Whois
databases can help consumers. 
For example, a trademark owner concerned about the misuse of its name by
"spoofing" its 
website is not only protecting its own business interests but is
protecting its customers from 
being "phished." 

The Red Cross recently explained how it used Whois data to shut down
websites that mimicked its website after Hurricane Katrina in connection
with donation scams. 
The simple yet crucial point is this: many legitimate uses of Whois data
by the business 
community and other non-governmental organizations have an important,
and often ignored, 
consumer protection dimension. 

V. Whois Databases and Privacy 

Concerns about the privacy of domain name registrants have driven much
of the Whois 
debate. The FTC, as the primary enforcement agency for U.S. consumer
privacy and data 
security laws, is very concerned about protecting consumers' privacy.
Thus, the Commission 
has always recognized that non-commercial registrants may require some
privacy protection 
from public access to their contact information, without compromising
appropriate real-time 
access by law enforcement agencies. The FTC supports the further study
of how this goal 
could be achieved. In the meantime, however, at the very least, ICANN
should preserve the 
status quo and reject limiting the Whois databases to technical uses. 

Restricting public access to Whois data for commercial websites and
depriving the public 
of the ability to find information about such websites would contravene
well-settled international 
principles. The 1999 OECD Guidelines on Electronic Commerce state that
consumers should 
have information about commercial websites "sufficient to allow, at a
minimum, identification of 
the business. . . [and] prompt, easy and effective consumer
communication with the business."
Thus, commercial website operators have no legitimate claim for privacy,
and the public should 
continue to have access to their Whois data. 

Moreover, the existing availability of Whois databases can actually help
agencies find out who is violating privacy laws and, consequently, help
prevent the misuse of 
consumers' personal information. For example, Whois databases were
invaluable in FTC 
investigations in phishing cases where the defendants sought to steal
sensitive personal and 
financial information from consumers. In addition, the spyware cases
discussed earlier also 
involve serious threats to consumer privacy, as spyware can monitor
consumers' Internet habits 
and can even retrieve sensitive consumer information, including
financial information, by 
logging keystrokes. Whois data has helped the FTC to stop these privacy
violations and, 
hopefully, will continue to do so. 

VI. Recommendations 

Based on the foregoing discussion of the FTC's consumer protection and
enforcement experience, the FTC respectfully makes the following
recommendations. First, the 
GNSO should reconsider and reverse its position that the Whois databases
should be used for 
technical purposes only. If this narrow purpose is adopted, the FTC,
other law enforcement 
agencies, businesses, and consumers will not be able to use the Whois
databases for their 
legitimate needs. This would hurt consumers around the world and could
allow Internet 
malefactors to violate consumer privacy with impunity. The FTC
recommends that the GNSO 
reverse its position at this stage and before the Whois task force
considers other outstanding 
Whois issues in light of this narrow definition. 

Second, the FTC has found it immensely helpful in developing its
position to reach out to 
consumer protection and law enforcement partners in the United States
and overseas. The FTC 
is particularly pleased to be joined today by consumer protection
enforcement colleagues from 
other countries who will share their views. The FTC is confident that
such outreach between 
ICANN's Governmental Advisory Committee ("GAC") representatives and
their consumer 
protection and law enforcement colleagues will reinforce the serious law
enforcement and 
consumer protection implications of losing access to Whois databases.
Certainly, the current 
direction of the Whois debate will seriously impair efforts of criminal
and civil law enforcement 
agencies to stop online fraud and other illegal conduct. 

Third, the FTC recommends carefully considering improvements in Whois
For example, as the OECD statements referenced above make clear, there
is simply no reason to 
prevent access to contact information for a commercial website. The FTC
urges ICANN to 
consider additional measures to improve the accuracy and completeness of
domain name 
registration information. The FTC is also interested in exploring the
viability of "tiered access" 
as a solution capable of satisfying privacy, consumer, and law
enforcement interests.
Restricting the purpose of the Whois databases does not satisfy any of
these interests and is a 
step in the wrong direction. Maintaining accessibility and enhancing the
Whois databases would 
make great strides toward fulfilling the promise and safety of the

In sum, the FTC believes that improvements need to be made to the
current Whois 
database system and is committed to working with others toward a
solution. In the meantime, 
Whois databases should be kept open, transparent, and accessible so that
agencies like the FTC 
can continue to protect consumers, and consumers can continue to protect
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