American Express Cuts Ties With Processor

Finally at last the major credit card companies (American Express Co., Master Card, and Visa) are taking action against CardSystems Solutions Inc., the Tucson-based company responsible for the largest loss of credit card data in history. It's certainly time for something to happen to this company for putting so many of us at risk for identity theft due to their carelessness.

Let’s hope that this action will send a strong message to all the companies that process our credit cards that the loss of personal data will have major consequences.

But is this really a case of too little too late?

Will the major credit card companies really stick by this decision and not just give a little slap on the wrist to CardSystems Solutions Inc. before going back to business as usual?

Will the credit card companies do what the government so far has been unwilling too do; punish companies that are careless with our personal information?

Well I for one doubt it.

Let’s face it; one of the last of the "Good Old Boy Clubs" is the credit card industry. Most of the companies that process credit cards and collect consumer data are private companies answering to no one. Not to the government due to the lack of laws and regulations and not to the public or stock holders due to their being private businesses.

From the massive amount of lobbying money they throw around in Washington to the ruthless business practices they employ against their competition the big boys in this industry play rough. Worse still they care little about the customers that make them their obscene profits. These guys make Microsoft's business practices look like school boy antics.

So what I predict will really happen is that as soon as the publicity quiets down the major credit card companies will go right back to using CardSystems Solutions Inc. It will be business as usual just as it was before any of this ever happened and their buddies who own CardSystems Solutions Inc. (Including Camden Partners a major private venture capitol company which invested $9.3 million in the Tucson company last year.) will continue to rake it in while leaving us at risk.

Anyway a good article about American Express’s, Master Card’s, and Visa’s action against CardSystems Solutions Inc. can be found here;

American Express Cuts Ties With Processor

Let,s just hope that it's for real and this company is made to pay the price for their carelessness.

Microsoft’s Old Dog “Security” Hasn’t Learned any New Tricks.

Microsoft has never received high marks when it comes to security but things seemed to be getting better. With the advent of security based code writing and the purchase of a company to get an excellent Spyware Adware scanner it seemed that Microsoft had finally decided that their customers deserved security and protection and Microsoft was committed to providing it.

But as the saying goes it’s hard for an “old dog” to lean new tricks. Now it seems that Microsoft’s old dog named “Security” is back at its old ways. Microsoft seems to again be looking at profits before security and customer protection.

The first hints of trouble started recently with the growing rumors of Microsoft’s intent to purchase the software company Claria. I’ll bet you’ve never heard much if anything about this company. It keeps a low profile but it’s well known in security circles.

Claria just happens to be the company that has single handedly produced some of the worst of the Spyware/Adware programs found on the web today. Just look up Gator, Gator Wallet, PrecisionTime, and Weatherscope on Google and you’ll see that these programs have a really, really bad reputation with security experts. (One that is rightly deserved in the opinion of every expert I’ve studied.)

At first I didn’t put much credence in these rumors of a buyout but now it seems that there must be some truth to these rumors after all. If it’s not a buyout something is definitely going on between Microsoft and Claria. It seems that suddenly Microsoft’s much touted Anti-Spyware program is now passing over Gator and some of the other programs that Claria software writes and distributes.

Strange that since by default every single major Spyware/Adware scanning package disables and/or removes all of these Claira programs so it’s not in question if these programs are Spyware/Adware. All of these Claria programs were by default also quarantined by Microsoft’s Anti-Spyware program UNTIL their latest “update”. Now it seems that Microsoft has changed the default setting of it’s scanner to pass over these programs and it allows them to continue to run on systems it’s scanned.

So if Microsoft isn’t trying to buy Claria then why did they make such radical changes to the basic default settings in their Spyware/Adware scanner? It didn’t happen by accident. Microsoft is smelling profit somewhere and it looks like they’re willing to lie down and roll over to make it. It’s too bad that some companies will do anything to make a profit. I was hoping that Microsoft had changed that attitude but it looks like it hasn’t.

Security and data protection have been sold out by Microsoft and unless their Anti-Spyware scanner is changed back to labeling Claria’s software for what it is Microsoft will ultimately be held accountable. I would hope that Microsoft wakes up before it’s too late but I don’t suppose that will happen if the past is any indication.

Microsoft and security still seem to be opposites.

PS If you still want to remove these Claria programs you only have to go to the ignore list and change the setting back to quarantine or remove to solve this problem. I've already be there and done that!!!

You can also find out more details on this matter in two other good articles located at;

eWeek’s home site http://www.eweek.com/article2/0,1895,1834607,00.asp
and on sunbelts blog site http://sunbeltblog.blogspot.com/2005/07/microsoft-sets-claria-to-ignore.html

STUPID IS AS STUPID DOES.

Well the experts are at it again and it’s a real bone headed stunt this time. It seems that I received an email the other day that I just knew was a phishing attempt. My credit card company (one of the largest in the country) had sent me an email explaining their new security feature of providing one time use numbers for on line purchases.

Having a number that was only good one time would make stealing the number worthless. Good idea!! I’m thinking that maybe these guys have it really together. Here’s a simple, cheap to implement, useful answer to stop online credit card number theft from being effective. Steal the numbers, so what, they’re useless.

So far so good I’m thinking as I read on through the very BOOOOOORING letter.

Then suddenly as I read on the alarm bells begin to ring. They (the credit card company) want me to click on an embedded link to go to their site to automatically activate this feature.

“YEAH RIGHT” I’m thinking.

Who do these idiots think they’re dealing with some dumb newbie?

Do they really think that I’m that stupid?

Now being a good net citizen I went straight to the banks site and sent a copy of this email to their “security” contact address. Now I’m I thinking that have nothing to do but sit back and wait to be thanked for reporting this new phishing attack. I just know that the bank will be glad to be able to warn others about it.

Well guess what?

I get a call from the bank the next day telling me that this email is correct and it really is from the bank credit card center.

“WHAT you guys are sending out emails that contain links to be clicked to go to your site.” I said. “Don’t you know that’s the favorite method used by hackers and phishing artists to get us to go to their bogus sites and be ripped off.”

“But this is different, said the agent on the line, we really did sent this email. It really will take you to our site.”

“But how should I know your email from all of the other phishing email that I receive”, I ask?

I get a long silence from the other end before he says that I don’t understand how this works. When I click on the link I will activate the one time use credit card number security feature which will protect me from such things as phishing and credit card number thieft.

“But what if a hacker or phisher gets a copy of this letter and changes the link to take me to a site where they try to get me to reveal my credit card information I ask? If I have any doubts and contact the bank you guys will even tell me it’s ok. Just like your doing now. How could I not be fooled by this copied email from going to a rogue site. You've told me everything is ok.”

“But it is ok the agent says. You don’t have anything to worry about we did send you that email.”

Well as you can guess by this time I’m giving up on this guy so I thank him for his help and ask to talk to his supervisor. When the supervisor comes on the line I let him know that I think I’m going to changing my credit card company and could he just put a hold on the account until I can pay off the balance due.

I bet you know what he said. “Why would you want to do that?”

Well I told him that I would send him an email to explain it to him if he would just give me his email address. While writing this email I was sorely tempted to enclose a clickable link to my blog site so he could read this letter but I resisted.

Besides he wouldn’t get it anyway!!!!

PS another article on the subject can be found here.

http://www.eweek.com/article2/0,1759,1833855,00.asp?kc=EWRSS03129TX1K0000614

PPS Have a safe and sane Fourth Of July everyone. I want to see you back here again so be careful.

Summer Jobs Mean Hidden Opportunities!!!

Well its summer time and your high school (or college) aged kids are getting jobs to earn a little spending money or help with college expenses. It probably doesn’t seem that long ago that the most important thing in their lives was getting their drivers license and that all important first date.

These are events that they (and you) will always remember (Fondly I hope.) as defining the beginning of their change from a child to an adult. These and other such events foreshadow the things to come in their life. College, marriage, that first good job, and of course kids are right around the corner most likely and it’s a busy and hopefully thoughtful time in a young person’s life.

What both you and that new worker are probably missing however is just how big an event that first job and the earned income it provides are to the total picture of your child’s future.

With that job comes a unique opportunity!!!

Silently, quietly, and never to come again has arrived the most opportune time in their life to start saving and planning for their future. It may have more potential for financial security later in life than a college degree or climbing the corporate ladder to a high paying job or profession.

What is this magic moment?

What has changed in their life that you and they may be missing?

What opportunity has occurred that will never happen again?

Well it’s the chance to start a ROTH IRA while they are young.

PLEASE, PLEASE….. DON’T LET THEM MISS THIS OPPORTUNITY.

Get them to set up a Roth IRA as soon as possible.

It’s never too early to start saving and starting a Roth IRA at young age is a guaranteed winner if it’s left alone to grow. Start a Roth by 20 and it has a chance to grow for 40 to 45 years tax free rather than the current average of 25 or 30 years that most retirement plans do.

Time not investing savvy or how much you save is the greatest asset that any investor has in their arsenal. It is the one asset that can’t be made up for as compounding interest requires TIME to work it’s miracle of tremendous growth. While bad returns on investments can be over come and savings amounts can be increased when opportunity allows only time allows compound interest to work it miracle and grow our savings to astronomical levels.

Believe me this is the stuff that investing dreams are made of. The difference those extra 10 to 15 years of growth makes is impossible to realize unless you play with the numbers. But it’s safe to say that on average it will probably DOUBLE and maybe TRIPLE the amount they have at retirement if allowed too.

Remember no less than Albert Einstein when referring to compound interest is quoted as saying:

"It is the greatest mathematical discovery of all time"

If Albert Einstein felt that compound interest was a greater discovery than his other findings like E=MC2 it shows just how powerful it can be for your child’s future financial security. Just think Einstein was saying that compound interest was more powerful than atomic energy and I can’t argue with him when you’re talking about investments.

In my next article we’ll look at the Roth IRA and why it’s one of the greatest investing programs that Congress has ever given us. I’ll cover both the basic rules governing Roth IRA’s and the cautions that you need to keep in mind.

Here’s additional Information on the Research Project Code Named Avalanche.

This original paper filed on Microsoft’s website explains the Avalanche project in detail and should help to put to rest the question of what Microsoft’s plans were and are for Avalanche.
http://research.microsoft.com/~pablo/avalanche.htm

You can also see eWeeks take on this issue of a conspiracy to damage BitTorrent. Check out this article by Steven J. Vaughan-Nichols at for his take on this issue.

http://www.eweek.com/article2/0,1759,1831018,00.asp?kc=EWRSS03129TX1K0000614

What Conspiracy against BitTorrent??

John Dvorak sure opened up a can of worms for me with his strongly worded story about his theory of a “Conspiracy” to ruin BitTorrent by the media and Microsoft. Since his article came out I’ve gotten more email about my article on this subject than I could have ever imagined. (You can read John’s article here if you haven’t read it yet to see what he has to say http://www.pcmag.com/article2/0,1759,1829684,00.asp .) Because of this article and the buzz it’s caused I felt that I should reply to John and the others that are pushing this conspiracy theory.

Come on John look around and see who’s writing these stories. It isn’t a bunch of fools that are writing about the Spyware/Adware problem with BitTorrent. Articles have been in every magazine and blog from eWeek to mine talking about the problem. Do you really think that I have any agenda with BitTorrent? I love and read your stories John but they aren’t always right especially when it comes to Microsoft and your conspiracy theories.

No one I know of is saying the problem is within BitTorrent itself but how it's being used by the Spyware/Adware distributors. BitTorrent is a great program and offers an answer to over loaded servers while providing secure data downloads without the possibility of tampering.

But that isn’t my concern!

The facts as I and others have stated them are as follows.

First Microsoft currently has no plans to challenge BitTorrent and all of the avalanche studies were just that studies. It seems that conspiracy theories are like gossip when it comes to Microsoft hard to stop and impossible to trace to their source. Microsoft is truly the company that people love to hate. Sometimes rightfully so but in this case John Microsoft is innocent and there is no conspiracy except in the mind of those who want to see one.

Microsoft has never had plans to release avalanche now or in the future. That’s right in documents on their web site from long before this argument took place. (Of course if they get enough buzz going on the subject that might change.) It was a research project in the beginning and it is still just a research project. Check it out yourself John if you doubt what I’m saying. Just search their information data base and see for yourself.

Second BitTorrent has definitely become a tool of choice to deliver Spyware/Adware programs and such to an unsuspecting public. I don't have to take someone else's word for this John as I have found Spyware/Adware floating around in BitTorrent downloads myself. When I scan my system before and after a BitTorrent download and find Spyware/Adware programs that weren't there before the download then they came in the BitTorrent download.

End of story!

So that’s the reason and the only reason I've quit using BitTorrent for the time being. Not because of some conspiracy, nor because I’ve bought into any false rumors or stories but because I, myself, found Spyware/Adware programs on my system that came in BitTorrent downloads.

And Third few if any Spyware/Adware detection programs are able to look into BitTorrent packets and see the signatures of any Spyware/Adware they may contain. Once the creodonts that produce Spyware/Adware programs found this out they realized that they had a great opportunity to use BitTorrent to distribute their cr*p. By their using a respected, popular program with good security features an unsuspecting public is allowing Spyware/Adware programs to be downloaded to their computers without even suspecting it.

That’s why I have recommended that people either stop using BitTorrent or use it with great care. I based my decision completely upon what I found was happening not on rumor or speculation. I’ve taken a great deal of flack on my article about BitTorrent after your article John but I stand by my statements in this article and in the original.

My advice to those people using p2p software is as it was before your article; Use BitTorrent if you feel you must use a p2p program. None but BitTorrent meets any standard of security that I trust as being very good. Just remember though that having a secure method of transmitting data that prevents tampering doesn't mean anything if the data is corrupted too begin with.

If you want to use BitTorrent or any other p2p program make a full Spyware/Adware scan before and after downloading anything. That will allow you to trace any problems you have back to the source. And while I have been accused of everything from being a co-conspirator with Microsoft (don’t I wish I was that close to Bill and the boys!!) to being a fool, I’m neither. I’m just an honest writer who feels that BitTorrent should be avoided like all of the other p2p programs as being too dangerous to use because of the Spyware/Adware risk.

So my decision to add BitTorrent to the list of programs that are just too much of a risk to use right now still stands. I download data using methods that allow for scanning for Spyware/Adware programs during the download process and thereby avoid the risk that I might not find them later.

So should YOU not use BitTorrent John?

I’ll leave that up to you and let you decide what risk is acceptable in your case.

Why? Because it is your business what you download to your computer.

Just don’t imply that I’m involved in any conspiracy with Microsoft or anyone else to stop you or anyone who wants too from using BitTorrent. I just prefer to stand on the side of security and safety and I feel that should I tell others of my concerns.
John I have too much at risk to take unnecessary chances and I’m too concerned with others not to express my fears to them! If that’s conspiracy then so be it but I call it being careful and avoiding unnecessary risk while meeting a public responsibility to help with safe computing.

Frank Woodman Jr

Flexible Spending Accounts are going to get better in 2005.

For a long time now flexible spending accounts (FSA’s) have helped taxpayers handle things like child care and medical expenses by allowing employees to pay such expenses with tax free dollars. That has made life a lot easer for many people and resulted in tax savings for a great many Americans. (Especially in the area of medical expenses since not many can take advantage of the Sch A medical deduction due to the high exclusion).

A participant in an FSA is currently able to set aside up to $5,000 toward child care and medical expenses and pay for these expenses out of their FSA account. The down side to this system though has always been that any money not spent within the calendar year it was saved was given back to the employer. So if you saved money to your FSA in 2004 you had to spend it in 2004 or you lost it. This use it or lose it rule in has always made figuring out what to withhold kind of tricky. Save too much and you loose it back to your boss with no benefit to you at all (ouch) save too little and you had to pay the expenses out of your after tax dollars (ouch again).

Well there’s good news for people who use flexible spending accounts regarding this matter.

The have loosened up what they call the grace period and made it a little farer as regards the time you have to spend the money. Beginning in 2005 and there after you will have up to March 15th of the year following the contribution to your FSA to use the money.

That extension of the grace period has only one down side. Your EMPLOYER not you must ask that it be extended as part of their plan provisions. I can’t imagine that any employer would not do so but some might. I suppose if they get back a lot of money because employees are withholding too much it might cost them but other wise it’s of no difference to them. But you do need to check with your benefits, payroll, or HR department, depending on who handles your FSA program, and see what you employer plans on doing.

If they don’t say that it’s in the works and will be available to you for 2005 do a little lobbying. It never hurts to put a little pressure on to be sure such things get done. Kind of like the Roth 401k program I spoke about a while back. Don’t forget to see if your employer is going to start it on Jan 1st as well. You can easily lobby for both changes at the same time since they are going to be administrated by the same department.

Watch Out for Changes to 529 Plans!!

While I’ve always liked and recommended the 529 College plans they may become a little less attractive after 2010. I don’t usually like to speculate on changes in tax law that are to take effect more than a year or two out since they have a bad habit of changing. But since 529 programs are long term commitments and require a lot of lead time to implement I will make an exception in this case. Besides I’ve got a feeling that this is one change that will take effect due to the need to balance the budget while not changing or increasing the taxes.

Currently all gains on 529 plans are tax exempt when use for College under a sunset provision passed as part of the tax reform bill of 2001. That prevision is due to expire at the end of 2010. At that time, unless the 2001 sunset provision is extended, the old rules pertaining to taxes on gains will be restored.

Those rules only allowed for tax exemption for gains in a 529 plan until you draw them out. Much like the rules for IRA’s and 401k plans you would be taxed on any gains as you take money out of the plan whither it’s used for college or not .

Does that mean that I don’t favor 529 programs any more? Not on your life. They still offer one of the best programs for college tuition savings available. Maybe not as attractive as before but good none the less.

So keep the 529 plan but don’t count on the gains being tax deferred even when used for college after 2010.

In the Here We Go Again Department

Now it’s FDIC that’s got egg on its face over poor security. It seems that the security breach of its employee HR records is much worse than first though.

For those of you who haven’t been following the recent rash of security problems in detail I’m sure you missed the FDIC story that came out recently. Briefly it had to do with the loss of employee HR records which was first reported in March of this year (2005) and was though to affect only a small group of current and former employees. At that time the FDIC contacted both the FBI and the employees in question that their personal data had been compromised (stolen).

The employee information stolen included the name, date of birth, salary, Social Security number and other such information contained in their personal HR files. That’s a total breach of personal information for those involved. I can’t imagine anything else that an identity thief would need to ruin you life except maybe a high speed internet connection.

Well now it seems that upon further investigation that not just the few employees contacted back in March were affected but ALL I repeat ALL current and past employees have had their data “compromised” (stolen).

So here we have the agency that is in charge of insuring and protecting our banking system as well as overseeing and notifying banks about how to secure sensitive information having all of their employee HR records stolen.

Worse to me is that it took further investigation to figure out that all employees were affected. You would think that it would be evident when the whole security system was compromised and all of the HR records had been stolen. That wasn’t the case though so for many of those employees who had their data stolen they also lost the help of early notification. The time it took to find out their data was taken is in some ways even more unacceptable than the loss it’s self.

Could you imagine coming home to find your house broken into and not noticing that rather than a few items being taken that the whole house was empty? Well that’s just what the FDIC failed to notice. Everything was taken not just some HR records but all of the HR employee records had been taken.

Why does this not surprise me?

Well again any system is only as good as the people who use it and most government agencies today aren’t any better at security than the private sector.

If you don’t separate digital data across different data bases, encrypt those data bases, provide physical protection to paper records generated, and destroy any old paper copies of information you dispose of then you will at some point lose data to thieves.

That doesn’t take a genius to figure out and it shouldn’t be so hard to do for such a large government organization to understand and implement. But time and time again they fail at it and so does the private sector.

So remember to be vigilant, watch your credit information, and protect your personal data so that you don’t add to the already growing problem of data theft. Just because others are sloppy and risk your data doesn’t mean that you shouldn’t be careful and do a better job.

Hackers Strike Again and 40M Americans Stand to Lose!!!

To see just how bad things are getting with the security of our personal information you only have to read about the most recent case of data lost by Tucson-based CardSystems Solutions Inc., a third-party processor of payment card data.

Somebody gained access to around 40 Million credit card numbers and the related security codes necessary to use them on line. Master card seems to be the biggest loser in the deal with some 13 to 14 million card numbers possibility compromised but all the major companies have been exposed.

Richard Smith at his website ComputerBytesMan.com described it as eligible for “the Guinness Book of World Records.” Wither that’s true or not CardSystems joined the ranks of Lexus, Bank of America Corp, ChoicePoint Inc., Reed and Elsevier, and Motorola as recent major companies having customer information compromised by their lack of security.

This is more than unacceptable it’s just stupid. As major company after major company commits the same childish security blunders you have to wonder why they can’t learn from the mistakes of others in this business. To keep repeating the same dump practices over and over again defies logic.

By their actions these companies are going to force government involvement and then they will all cry bloody murder. Well I can’t feel sorry for them but I know who will bear the cost of all of these new regulations.

You and I will pay for their stupidity. Both by the losses from the theft of the information and the cost to implement any new regulations required to protect us.

There is no good reason for these data bases not to be encrypted so as to be less venerable. It comes down to greed as the companies involved reduce costs by lowering their IT expenses. Encryption software isn’t expensive and using it would at least make the data basically unusable by the thieves.

This case is made so much worse because not just the credit card numbers but also the security numbers required to use them on line were kept TOGETHER in the same data base.

How stupid can you get???

Any first year computer student could come up with a way to store these numbers in a separate data base to make it harder to match up both the credit card number and the security number. If I were designing a system to store that kind of information I would keep the card holder name, the card number, and the security code each in a separate data base. That way if you didn’t know how to combine these separate files you would only have lists of names and numbers that would be worthless. If these separate data bases were also encrypted it would make it almost impossible to compromise this data.

So……… If I can figure that out then why can’t these so called experts?

When are these companies going to be called to task?

When are they going receive the fines and criminal punishment they deserve?

Only when the public wakes up and demands that the government give some teeth to legislation requiring the protection of personal information in the private sector. These large, many times unknown, companies have an obligation to protect the data they gather about us. They owe us at least a modest attempt at having security that is able to protect us and that isn’t happening right now.

Personally I would like to see fines and in cases of real mismanagement criminal punishment handed out. It’s time to put a stop to this and to do it NOW not later.

A good article on the case is also located on eWeek at this URL
http://www.eweek.com/article2/0,1759,1829378,00.asp?kc=EWRSS03129TX1K0000614

Intermix Media Settlement with New York

Check out this eWeek article about the recent settlement against Intermix Media that resulted in a fine and settlement of $7.5 million dollars. At least this company has been brought to justice and it should serve to warn other such companies that retribution may be at hand if you go around spreading Spyware/Adware. You can read the entire article at; http://www.eweek.com/article2/0,1759,1828397,00.asp Let’s hope this sends a loud and strong message to these guys. Stop spreading this filth or else pay the price!!!!

BitTorrent and its Spyware/Adware Problems

Well folks it’s finally became such a problem that it can’t be hidden or over looked any longer. BitTorrent (the darling of tech bandwidth sharing download programs) has become a major spreader of Spyware and Adware. What started as only a small problem has become a real river of filth and trash as BitTorrent becomes only the latest in a long line of p2p software download programs to be taken over by Spyware/Adware distributors.

Let me make one thing clear. BitTorrent isn’t to blame as it’s impossible to stop this stuff and I knew it was only a matter of time before it became a problem for BitTorrent. If you use ANY p2p program not just BitTorrent it’s only a matter of time before you become infected with one or all of the following; Spyware, Adware, a virus, or a Trojan. Let’s just say that BitTorrent took a little longer before it had the problem because of its high tech base.

I first noticed it back in October of last year (2004) when I found that a download of Linspire I had made using BitTorrent was infected with an Adware program (yes even Linux has this problem). It got me to checking into what was going on and what I found was discouraging to say the least. Most of the savvy users of BitTorrent I knew had discovered that it was now spreading more and more Spyware/Adware infected programs.

It’s too bad as I loved BitTorrent and used it quite often to download programs because of its easy handling of large downloads. Even with my high speed cable modem it made many downloads faster and easer by reducing the bandwidth problems for servers downloading large popular programs.

But that is over as I no longer use BitTorrent’s program anymore. The chance of infected downloads is just too great right now. So sadly I bid goodbye to a program that I used and loved. Does this mean that you shouldn’t use BitTorrent? Well I’ll leave that up to you but I don’t think that it’s a good idea if you’re concerned about security.

So a word to the wise avoid BitTorrent unless you have a good compelling reason to use it and be sure to scan and examine anything that you download or you will be opening the door to a lot of security issues.

For additional information about this problem check out this recent article from eWeek;

http://www.eweek.com/article2/0,1759,1828633,00.asp

A Timely Quote from Steve Job's Commencement Address

I received this quote in an email today and felt that I should share it with you. If you follow this advice your life will always be more successful and happier so take it to mind and use it today. You'll see the difference I promise.

Do you know who Steve Jobs is?

If you don't, his success story is legendary.

Put up for adoption at an early age, dropped out of college after 6 months, slept on friends floors, returned coke bottles for 5 cent deposits to buy food, then went on to start Apple Computers and Pixar Animation Studios.

Steve Jobs is one of the most successful entrepreneurs of our generation.

On June 12th 2005, Steve Jobs gave the commencement address at Stanford University and I want to share with you a few clips from his powerful speech.

From Steve Jobs commencement address:

"Sometimes life hits you in the head with a brick. Don't lose faith. I'm convinced that the only thing that kept me going was that I loved what I did. You've got to find what you love. And that is as true for your work as it is for your lovers. Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. If you haven't found it yet, keep looking. Don't settle. As with all matters of the heart, you'll know when you find it. And, like any great relationship, it just gets better and better as the years roll on. So keep looking until you find it. Don't settle.

"When I was 17, I read a quote that went something like: "If you live each day as if it was your last, someday you'll most certainly be right." It made an impression on me, and since then, for the past 33 years, I have looked in the mirror every morning and asked myself: "If today were the last day of my life, would I want to do what I am about to do today?" And whenever the answer has been "No" for too many days in a row, I know I need to change something."

"Remembering that I'll be dead soon is the most important tool I've ever encountered to help me make the big choices in life. Because almost everything all external expectations, all pride, all fear of embarrassment or failure these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart."

"Your time is limited, so don't waste it living someone else's life. Don't be trapped by dogma - which is living with the results of other people's thinking. Don't let the noise of other's opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary."

P.S. This quote is most timely with the recent death of Corey Rudl the internet marketer. He certainly followed it everyday he lived and I'm sure he went just the way he would have wanted. Doing what he loved both in his private life and in his business career. As always the good ones seem to go all too soon from our lives.

Take care and God Bless,
Frank Woodman Jr

On Google vs. MapQuest the Winner is???

Use this URL address;

http://hostingproject.info/Zilos/googlex/

It will take you to a great page where you can chose from all of Google’s web tools. On this page with a click on an icon you can jump to any Google service. It’s not a page that is hosted by Google but it should be as it makes getting around between all of the many Google web services so much easer.

It’s just much quicker than going to google.com and trying to get around.

Anyway go there and click on the map icon to check out the new Google map site. Google is giving all of the other map sites a real run for their money. MapQuest is going to have to work hard to hold on to number one.

Google’s maps and directions look nicer and you can have local search information shown right on a map. Do a search for “pizza parlor” and bingo the map shows flags of all of the pizza parlors that are close to the entered address. One thing for sure Google just doesn’t rest until it puts out a better product in what ever service they are providing.

P.S. Be sure you play with the satellite view feature in Google maps. It’s so cool the way you can jump from map view to satellite view with just a click on the control bar. You can even see your rout in map view or satellite view with just a click to toggle from one to the other. Using the satellite view can help to make the map more understandable and easer to follow.

Any way check it out and see what Google maps are all about if you haven’t already done so.

P.P.S It’s interesting to note that while Google has been busy pushing online map services up a notch both Microsoft and Yahoo have been busy pushing hard to move up a in the fight to dethrone Google as the number one search engine. Google needs to be looking over their shoulder and watching the competition.

Both MSN and Yahoo have undergone some real changes that will up the pressure on Google to add features to their search engine. If you haven’t tried them out recently it’s time you revisited both MSN and Yahoo and checked out their search features again.

You might be surprised to find that both offer some real interesting choices and that for some types of searches they may beat Google. (I never though I would ever say that as Google is something I use constantly!!)

Anyway it’s going to be an interesting year with all of the battles going on in the search engine arena. The winner is yet to be determined but Google still leads the pack as much by momentum as by anything else. Everybody else is playing catch up and Google certainly isn’t going to make it easy for them.

Is There Any Hope for Computer Security or are We Doomed??

Part 1

This article is the first in a series of articles looking at where we stand with computer security today and what we need to be doing in the near future to address this problem. I’m going to look at computer security and present both my security concerns and some answers on how to achieve a reasonable level of security for your system.

The need for this series of articles became evident to me when I started to write the current security measures that I use to protect my computer systems while keeping my personal information and my client’s business data safe.

It soon became evident to me that what I was going to propose to the average computer user was going to seem to be way over the top. I felt that without some explanation most readers would feel that my suggestions were to expensive, require too many programs, and take more time than necessary. It’s my hope that with this series of articles I will show you why all of these measures are both prudent and necessary.

Here a Computer, There a Computer, Everywhere a Computer.

As a society of computer users we have come to depend on our computers for so many things that we’ve become trapped as innocent pawns in the consent and ever changing battle between the thieves, hackers, crackers, and spam ware artists vs. the computer security industry.

Computers are already in our phones, our cars, our TV’s, and surprisingly enough our refrigerators. They control our power girds, clean our water, handle our sewage and even diagnose our medical problems. We are facing a world in which computers are in everything we use and control most of what we do. So computer security will become even more important in the future than anyone can imagine.

That means that on the one hand we can’t exist with out using our computers for everything from our kid’s homework to our online banking. While on the other hand we live in constant fear that we are at risk for everything from identity theft to having our bank accounts cleaned out. It’s the preverbal being caught between a rock and a hard place.

The first thing to note is that currently we’re losing ground in this battle. If we all don’t take major steps to address the current security problems that exist email and many other features we’ve came to rely on are going to become unusable. Our data both business and personal must be protected from loss and misuse if our society is to realize the great promise of our technology. We must win this battle at any cost and we can’t afford to sit on the sideline and hope that things will work out. Like it or not we have been drafted and we’re all in the fight.

So what fuels this war of the geeks and the freaks?

The sad fact of the matter is that for most of the perpetrators it’s really only a game. They are just in it for bragging rights and to feed their massive egos. Like a video game the damage and destruction they cause is of no more concern to them than the vandal writing on a restroom wall. We saw a good example of this with the recent verbal baiting and taunting between virus writers. For this group there is hope that education can eventually help to reduce their numbers.

For the rest it’s just an easy and profitable form of theft. When you find a way to steal large sums of money with only a small chance of getting caught it’s certain to attract the attention of criminals and opportunists. Recent trends and schemes show that even organized crime is getting into the act. Lots of money to be made with little risk sure sounds like a criminals dream. The only thing that this group will understand is quick, harsh punishment but even that won’t completely prevent it.

But whither they are deceiving us with phfishing schemes, stealing our passwords and personal information with key loggers, or just destroying our hard drives with viruses it is becoming harder and harder to stay ahead of those who would attack our computer systems whatever their motivation.

We will only solve the computer security problem by education, legislation, and hard work.

First, we must join in the battle and through education and by staying constantly vigilant we can reduce the risk both to ourselves and everyone else.

Second, we must be willing to devote resources to solving the problem. Yes it does cost money and it will take time to keep our systems clean and protected. But it will be well worth it if we keep the free and open use of out computers without risking our safety and privacy.

Third we must recruit others to the fight. Far too many people feel that this is someone else’s problem. It’s not going to be the computer industry, nor is it going to be the government, but us as computer users that will solve this problem. Remember no legislation or magic software program will take the place education, vigilance, hard work, and common sense.

As the cartoon pogo (sorry if this dates me since it comes from the 60’s) said, “We have met the enemy and they are us!”

So What are the Major Risks to Our Computer Security?

Email and its lack of protection as both a source of Spam and Viruses.
Trojans and key loggers.
Spyware and Adware.
Bot systems and denial of service issues.
Staying alert since NEW risks are always being created.


So join me next in a detailed look at these risks and what we can do to reduce them.

Experts Warn of Growing Trojan Threat

Experts Warn of Growing Trojan Threat

Triple-Barreled Trojan Attack Builds Botnets

Triple-Barreled Trojan Attack Builds Botnets

Security Alert for Netscape 8

Just a quick alert to let you know that the much awaited release of Netscape’s browser (version 8) has some security issues you should be aware of. I mention this because I don’t want the quick patch release they made for other security issues to make you think that all is safe and sound with version 8.

It seems that the trusted site feature is currently allowing some sites that are known Spyware/Adware sites to download software to a user’s computer. Sites are supposed to be checked against a white list/ black list screening system to determine if they are trusted or not.

This scanning should be blocking questionable sites that are known to download Spyware/Adware from being able to download software to a user’s computer. For reasons that aren’t being made clear that isn’t happening.

EWEEK tested and found that the green "trustworthy" symbol was displayed on both hotbar.com’s home page and on ABetterInternet.com’s home page. I checked out the sites of Hotbar and ABetterInternet (two sites that are notorious for their Spyware.) for myself using Netscape 8 and found that both sites did receive the “green” or “trusted site” rating.

Worse still I then verified that both sites had successfully downloaded their nefarious software by scanning with spybot search and destroy and finding the software downloads in place and seemingly functional.

Not what I was hoping but my findings none the less.

In theory since these sites are listed on one of the lists that the trusted site scanning engine is supposed to use (Aluria's list of Spyware/Adware) and they both should have been blocked from making any software downloads and shown as none trusted sites. That certainly wasn’t what I experienced.

Netscape’s use of third party lists and rating systems is part of the problem. Several of the lists being used don’t address Spyware/Adware issues at all. Some are trade associations while others deal with business issues like privacy of customer information. These groups and organizations aren’t the ones to help with detecting Spyware/Adware sites. Netscape should be using only lists and organizations that are known and trusted as experts in the field of Spyware/Adware detection and prevention.

A good example is the use of TRUSTe. Their rating system and therefore the sites bearing their seal of approval don’t address the issue of software downloads, Spyware or other wise. This is according to no less than Fran Maier the executive director at TRUSTe. Their seal of approval only addresses the rated company’s privacy protection policy. Certainly something to know and be aware of but not something that pertains directly to the Spyware/Adware issue.

Anyway until Netscape gets things working as advertised with the trusted site rating system use caution and be sure you keep your Spyware/Adware scanners up to date. Remember safety lies in continuing to scan your computer system often no matter what browser you use.

It is unfortunate that this has to happen just when the Foxfire browsing engine (used in both the Netscape 8 and Foxfire browsers) has been gaining on IE mainly due to better security and more advanced features. But bear in mind that both Netscape 8 and Foxfire for that matter are very good browsers and are a step above IE in security with or without the trusted site feature.

Let’s hope that Netscape cleans up this problem soon like they did with the other security issues that were patched shortly after version 8 was released. We need to have a reliable and secure second choice in internet browsers.

Let’s hope that Netscape and Foxfire keep pushing Microsoft to improve IE or we’ll be stuck with poor security and no improvements in browsers for years to come. It is encouraging to see Microsoft rushing to release the next version of IE much sooner than was expected.

The Truth about the NEWS and What it means.

I’m sitting here reading the newspaper and thinking about some of the recent events that have been in the local news. This has caused me to think about the truth of the “NEWS”. To ponder and think about the many things that make the “News” and the many things that aren't covered is to give though to the truth behind the “NEWS”.

I've always pointed out that it's not news that where I live 300,000 thousand people go home every night, go to bed, sleep undisturbed and get up the next day to do it all over again. When nothing happens to them that isn’t news and their stories aren’t considered as news worthy.

So the news isn’t about reality it’s about a unique and unusual musicale part of reality. It is a microscope seeking out the unusual and unique to show us what’s different and not what is normal or usual.

We don’t see a picture of the hundreds of houses in our neighborhood that are fine and ok we see the one that caught fire. We don’t hear about the hundreds of friendly dogs who play lovingly with their families we hear about the one that bites a kid. It's the three idiot gang members that shoot at each other that gets attention not the hundreds of good kids that go to school everyday and cause no trouble.

So we all need to remember that the news has always distorted and damaged the public’s perception of what's normal and expected. If the public doesn't learn to judge the news and rate it’s importance while remembering that then we will all forever live in fear of the wrong things being while being manipulated by who decides what is being shown and reported as “NEWS”.

Remember if its news it's because it is unique and seldom happens and if it was truly normal it wouldn't be covered or mentioned at all.

So don’t live in fear of the things they are telling us about on the “NEWS” and be on the lookout for the real dangers in your life. Trying to judge the importance of things by their real chance of happening and not some imagined danger to our safety is the real key to our security, piece of mind, and freedom.

Is it a Hoax, maybe a lie, or just a rumor?

Maybe you should find out first before you spread it around.

A friend recently forwarded me an e-mail about StarBucks and how they weren’t supporting out troops in the Middle East and should be boycotted. This is a person I’ve known since college and is a fine man in all regards. He’s that kind of friend that you know you could trust with anything and over the years I have found him to be beyond reproach. He’s someone who would never dream of spreading gossip or stories about someone even if he though they were true.

Yet here on the net he was only all to willing to press the forward button. So what makes such a person so eager to blindly forward an email without even a moment’s though or investigation? That is a question I wish I could answer but somehow I fear that I never will. It is possibility one of the great mysteries of the internet. Certainly not something we’ll answer here today but ……anyway.

I immediately went to StarBucks web site and found the information to refute the email I had received. It took less than 5 minutes to discover that this email was incorrect and should not be circulating. I took a moment and sent a reply to everyone on the mail list including the friend about what the facts were and where they could find out the information to verify what I had written.

I felt good knowing that I had helped to kill an untrue story.
But guess what I found the next morning in my email box. The same email sent by three other people I know. Again I sent them the email that I had sent the night before. But this story only shows how things on the net never die and that even people that I consider reasonable and caring people will forward almost anything they receive in an email without any checking or verifying.

Folks this is something that is against the whole concept of the web. The web is the one place in the world where an almost unlimited amount of information is available. That means correct information should rule but the sad truth is that too many people don’t check things out that they hear or see on the web. They just hit that forward button and keep the junk flowing.

So with the though that in mind that if people knew where to check things out maybe they would do it I am listing my favorite sites for checking out on rumors, stories, hoaxes, and such.

Please check with one or more of these sites BEFORE you send on junk you get in your email box.

http://www.snopes.com
http://urbanlegends.about.com
http://www.scambusters.org/legends.html
http://www.factcheck.org (political content)
http://www.breakthechain.org (chain letters)

Just remember this stuff is as bad as or worse than SPAM so keep that in mind when you consider forwarding anything.

MAKE TIME FOR SAVING THE TRUTH

OR THE LIES WILL END US ALL!!!!

What in the World is FACTA and Why Should I Care?

Starting last December major changes were made in the federal Fair Credit Reporting Act by the passage of FACTA. Since this law has taken effect it hasn’t gotten the attention that it deserves. That’s why I felt that I should discuss it here.

The Fair and Accurate Credit Transactions Act

FACTA for short strengthened the federal Fair Credit Reporting Act which has been in effect for several years. Now numerous rules and provisions are in effect that are going to mean lots of changes for Americans and how their personal data is protected by businesses, professionals, and others. These changes are going to be far reaching and for the most part positive.

While most of the bill and it changes are good for consumers (for a change) there are some parts that aren’t all they could have been. I think that the worst part is where the states are bared from passing any laws that are more restrictive than FACTA. That is another nail in the coffin of states rights on consumer issues. While I think that Federal laws in this area are going to be the best total solution to bring both protection and consistency that doesn’t mean that if the states want to address some of these areas with stronger legislation that a weaker Federal version should take precedence.

Any way the following changes have either take effect or will shortly take effect.

Federal rules and regulations either now or soon will require that credit card receipts and such data not be printed in full to prevent data theft. (Exceptions for hand written embossed receipts are allowed which is unfortunate.)

Businesses that handle medical, financial and other important data in printed form are required to shred documents before they throw them away.

Electronic data must be deleted by a secure method that makes recovery difficult to impossible.

A new alert called the “fraud alert” allows consumers to have credit agencies flag their accounts to alert potential creditors of possible fraud. Once a fraud alert is placed on an account a potential credit provider must call a phone number listed by the consumer to verify the transaction.

Military now have the “active duty” alert to flag their accounts while they are out of the country on active duty. Military personal have been prime targets for identity theft artists since they aren’t going to find out for sometime that their account had been compromised and they are out of the country and unable to actively pursue the matter.

Consumers will in many cases be able to obtain free credit reports after filing a fraud alert and or an active duty alert.

Victims of identity theft will now be able to obtain the records of the transactions or have them sent to any police or federal agency necessary. This goes a long way in helping them to recover from identity theft and restore their credit.

And the list goes on and on covering such things as your rights as a credit consumer, how to dispute inaccurate information, when a notice of negative information is required, how medical information is handled, your right to a free consumer credit report, and it even addresses regulation of agencies besides credit reporting agencies with the section dealing with what are called nationwide specialty consumer reporting agencies.

It is hard to believe that the same Congress and Senate passed both the new Bankruptcy bill with all of its negative impact and the FACTA with it positive protections against identity theft. Go figure sometimes even the Government can do something right!!

You may remember the story about how an unlimited number of monkeys typing away on an unlimited number of typewriters would finally be able to create a great work of literature. Well this bill proves that story has some element of truth. ;-)

Anyway this bill much too long to cover in its entirety here but to see a great review and study of the whole bill and its importance check out this site. It is definitely a bill that you should read and understand.

http://www.privacyrights.org/fs/fs6a-facta.htm

I will also be writing a short article about how this bill will affect you if you have a small business. These new requirements are going to require everything from shredding a lot more paper to having in place better electronic records management.

DON’T LET THIS FLY UNDER THE RADAR AND GET YOU IN TROUBLE.

These new rules require a careful study of your day to day business practices and should be the signal to study all aspects of customer privacy as practiced by your business. Wither your an accountant or an Avon lady you will come under these previsions and you need to be prepared or face strong fines and consequences.


(This site carries a lot of great information on many issues that deal with consumer rights and legislation. Bookmark it and check it out once in a while for lots of good reading.)

The Coming Retirement Funding Crises!! Or Money, Money, Who’s got the Money?

If you think that the only thing you have to worry about regarding your retirement is if Social Security is healthy then you better think again. The scandal taking place in private retirement programs is becoming a much bigger problem and its being largely ignored by the both media and the legislature.

While the questions raised about the future of Social Security benefits has left us looking for a pea of truth under moving shells of deception we are being kept from seeing the much larger picture of private retirement funding problems.

It comes as no surprise that many sectors in the economy are having a hard time today but it is being underplayed just what this means for the future of retirement in America. For example take the recent case of United Airlines and its bankruptcy. On the surface it’s a pretty cut and dried case of a problem sector company (air transportation) filing for business bankruptcy.

But the facts of this bankruptcy go much deeper than that. United Airlines is being allowed by the bankruptcy court to screw its employees out of their pensions. The bankruptcy court ruling in this case has resulted in United Airlines pulling off the biggest default in the history of retirement funds. This ruling is a sad day in American judicial history.

Worse yet with many airlines (not just United), auto manufactures (including GM) and retailers (like Kmart) seeking protection through, sale, reorganization, or bankruptcy we will continue to see huge under funding in employee retirement programs. While the companies involved are allowed to walk away from these obligations the employees and tax payers will be stuck with them.

We have seen the federal Pension Benefit Guaranty Corp. go from a $10 billion surplus to a $23 billion deficit in under 7 years. (The PBGC is the federal agency which insures traditional pension plans.) And while most Americans know even less about the PBGC, which is maintained by corporate premiums, than they know about the Federal Depositors Insurance Corp. (that insures bank security) they will soon be made aware of their precarious situation.

Currently the PBGC has $39 billion in assets while having and estimated $63 billion in long term liabilities. At the same time, the PBGC estimates that the total under-funding in the pension system(that it could be at risk for coverage) has reached a record $450 billion. At this rate the under funding problems of Social Security look puny by comparison.

No insurance program can endure that kind of outflow and of course the tax payer is on the hook for any amount needed to bail out the system. This problem has the potential to make most of the scandals of the last few years ago look small and insignificant by comparison.

It also comes at a time that couldn’t be worse for the American worker. This hemorrhage of red ink is threatening our private retirement system just when it will be needed to help shore up retiree’s incomes during the coming Social Security crises.

So while major corporate salaries are still in the stratosphere and worker salaries are being pummeled by the twin terrors of outsourcing and lowered earnings we watch as corporate thefts of the night busily stealing our retirement funds. There use of corporate bankruptcy laws comes after new legislation that has personal bankruptcy more restrictive and harsher than at any time in recent history.

We are watching corporate America steel our retirements from us while penalizing us by making us pay for it as never before.

What can be done to resolve this problem before it’s too late?

We can start by recognizing the problem and facing the fact that we’re already been ripped off to the tune of Billions of dollars. Companies are failing to pay the funds to employee’s retirement programs that they are obligated too under their existing contracts.

That must be put to a stop!!!!!

We all need to be writing our Congress men and Senators demanding that such events as have happened with United Airlines not be allowed to continue.

We also need a much higher premium for corporations paying into PBGE if we are to end the shortfall that exists with the PBGC while we can still can. Corporations are getting a rate that is much too low for the risk that is being assumed and they must be made to pay up.

We need bankruptcy laws that protect retirement fund payments from forgiveness. It’s time that the employee receives the necessary protection to prevent him from being left holding the bag. Under current law they lose twice; once as the employee and again as the tax payer.

So remember you’ve been warned!

You neglect this problem at your own peril.

Failure to act will doom this next generation of retirees to face the worst conditions of any group of retirees in America since Social Security was instituted.

New Meningitis Shot Ready for Children - Yahoo! News

New Meningitis Shot Ready for Children - Yahoo! News

What are the Differences between Viruses and Spyware?

I guess I should have known that my last blog would bring several questions from readers about what are the differences between viruses and Spyware. I guess I can understand the confusion since there are no definitions that all can agree on when defining these terms.

So here are my answers to the questions I received.

Just bear in mind that they are my answers and I know that not everyone would agree with them but I feel that they generally define the problem and clarify these terms. They are based upon my own experiences and judgments and certainly aren’t intended to be considered as definitive. They are just my perspective based upon my years of working with computers and fighting viruses, Spyware, and other malware.

What is a virus?
It’s any program containing all the code necessary to reproduce itself from a self-contained package that allows it to replicate from computer to computer and network to network without any human intervention. Virus can range from being nesciences to being dangerous threats. All of them cause some damage and some can completely destroy a computer system or network.

How do viruses spread and how do they do it so fast?
Viruses are spread when their code is run on a computer allowing the virus to replicate and make other copies of its self. These copies are then spread to other computers as payload within another program. Often it’s contained in an email but it can be hidden in any program that is downloaded to a computer ranging from an mp3 file to a text document. Since viruses are small self-contained packages that can be copied quickly and are sent as small payloads they can and do spread very fast.

What is Spyware?
Spyware is any program that resides on a computer with the intent of gathering user information and secretly sending it to someone else. Spyware in general doesn’t try to replicate itself but is only interested in residing on the machine it’s installed on and gathering information. Spyware may be as innocent as a program that watches what sites you go to and thus allows for targeted ads or it may gather any and all information typed or located on a computer. Key loggers are a good example of the latter. It is this wide difference in what Spyware does that make it so hard to define, detect, and control.

How do I get Spyware?
Spyware gets on a computer through active content on a web site or by downloading a program that then secretly installs the information gathering portion of the program. The information gathering is then done without the user’s knowledge or informed consent. Often a computer user willingly installs Spyware on their computer by installing a program that purports to do some innocent function but ends up spying on them and reporting back to someone with the information.

(Remember to use caution since many of the screen savers, weather monitors, wallet programs, and other freeware on the web are really marketing Spyware and should be avoided.)

Why is Spyware getting so much of the attention now and not viruses?
Well I’m not sure which is getting the most attention but I know that Spyware is becoming more of a problem than viruses. Spyware is much harder to detect and scan for and it’s much harder to get rid of. Currently most virus detection programs are close to 100% effective at virus detection while Spyware detection is luck to hit an 80 to 85 % detection rate. Worse still is that while it’s easy to define a virus just what is Spyware is much harder to define.

What can I do to prevent Spyware and viruses from getting on my computer and compromising my system?
Well you’ve all heard the standard answers. Be careful and trust no one. Watch what sites you go to and don’t open email that seems to be suspicious. Use a good firewall program, keep your antivirus program up to date, and scan for Spyware with a good Spyware detection program. And I agree that if that’s done with the right tools you will avoid trouble with not only viruses and Spyware but the Trojans and the other malware that’s out there as well.

That leads to the question of; what are the best choices for these programs and how should a person go about using them? I think that this matter is important enough that I will write a second article describing the methods I’ve use for over 5 years to avoid having any major problems with viruses, Spyware, or the other dangers out there on the net. Being in the tax and accounting business I have had to deal with these and other problems so as to protect both my computer systems as well as my client’s data. The method that has evolved has grown over these years becoming more and more involved and using several programs but it’s still easy enough for most people to implement it.

So stay tuned and we’ll discuss my solution to protecting my system in detail. Hopefully it will help you to develop a system for yourself that will work and protect your computer from attack and surveillance.

Is Legislation Ever Going to Address Spyware!!!

The House has finally passed a bill against Spyware that may contain some much needed help against those who write it. Since it’s only passed the house it’s not a law yet but the Senate seems ready to address the issue and should pass something similar this year.

This bill contains some real punishments for Spyware writers with prison sentences of up to 2 years and fines of up to 3 million dollars per violation. And if you use Spyware to perform other acts like identity theft you could have up to 5 additional years added to your sentence. I’m not sure that 2 years in prison is enough but 3 million dollars in fines is a pretty good deterrent.

So if the Senate passes something that is close a bill of some kind could become law this year. It’s hard to believe that something hasn’t managed to get passed with all the pressure being put on to do something about Spyware.

This is one of many times that Congresses and the Senate are definitely responding to slowly on a matter of great importance to protect our technology infrastructure. It seems that they continue to fail to understand the need to protect our technology base from the many existing threats that could destroy it.

However, I predict that unless it's more effective than the can spam act it will have little impact on Spyware. But we can hope that it helps and any legislation is better than none in this matter. So while it remains to be seen just how it will play out anything that may reduce Spyware and make our on line computing safer needs to be done. Just don't hold your breath while you wait for this law to help.

The first problem is that even amount the savviest users no clear definition of what Spyware is has been agreed too. That makes it hard to outlaw something if it can't even be defined by those who will be charged with helping enforce this legislation. Even among the companies that are producing anti-Spyware software you will see that there is little agreement as to what should be considered as Spyware.

Different Spyware programs will find may differences in what they consider safe while all fall short of detecting everything that is truly Spyware. This is something that must change or Spyware will always be with us.

Some of these anti-Spyware programs even contain Spyware themselves. This is the ultimate insult for users who use these programs hoping to solve their Spyware problems. They end up introducing Spyware on their systems while trying to prevent it.

The thugs that promote such fraud should be the first ones dealt with and it should be a hard, swift, punishment. The bill defines such actions as changing your start page, capturing private user information, or changing system files and settings as constituting Spyware. I’m sure that all of these specific actions can be agreed upon as improper functions unless allowed by a fully informed user.

Second; while most Spyware practices are already illegal (under deceptive-business laws) only two Spyware companies have been sued so far. We just aren’t using these laws to bring to justice those who are violating basic business law as it is already written. That means more laws aren’t going to help until we start applying the laws that we already have on the books.

Third; it’s the computer users themselves that cause a lot of the problem. By using available software to clean and protect their systems a user can stop all but the most insidious forms of Spyware now. Yet many users fail to do just that. I still find people and companies that aren’t even using a firewall for gosh sakes.

Worse yet users continue to use programs that contain Spyware willingly and with little regard as to its effect on their systems. That little chance that anything will be solved by laws until users wake up and do a better job of checking out the programs that they install and run on their system. Remember Gator (The Gator Corporation is now Claria Corporation), Gator eWallet, and Bonzi buddy are still out there and still being used on a lot of computer systems even though they are known offenders.

It seems that some users don’t care what the software does as long as they like the features that it provides. That is unfortunate since all of these programs can be replaced by programs that do the same functions while offering features as good or better just minus the Spyware. And fourth; even major companies are using programs that are for all intents and purposes Spyware. It's time that companies that should know better quit using these methods to spy on their customers. Many of the methods of registration and digital rights protection currently being used are just fancy Spyware programs as far as I’m concerned.

Spyware isn’t right for any reason and our technological infrastructure must find a way to provide protection with out infringing on the rights of the user. It's like trying to understand why Yahoo and Google are still using popup screens and ads in certain locations while offering popup blocking software that blocks these very types of ads. It seems the height of gall to get people to pay to have popup ads only to have them blocked by the very companies that they have been paying to run the ads.

Well that’s a matter for another article. Stay tuned and soon we will look at the dark side of popup ads and the blockers that are used to stop them.

You may see a good article on the subject at http://ct.enews.eweek.com/rd/cts?d=186-2059-2-79-357217-233724-0-0-0-1

Part 2 WHAT’S GOING WRONG WITH 401k PROGRAMS?

In part one of this article we discussed the upcoming Roth 401k and the existing standard 401k with the hope of helping you to understand that one of these two programs is most likely your best bet to provide for your retirement.

We looked at the low rate of participation among eligible workers in 401k’s in general and younger workers in particular. Then we considered the risk to the future of retirees in this country in light of the question of the solvency of the Social Security System.

With the failure of far too many workers (especially young ones) to save enough to insure their financial security during retirement and the questions of Social Security Solvency you would think that these problems are the major hurtles to be over come.

But you would be wrong. The real dangers to retirement programs and 401k’s in particular are much more serious and have been around since 401k’s first began. Introducing Roth 401k’s hasn’t solved any of the problems that exist within the 401k program.

These problems have been covered up for years by the employers, plain supervisors, managers, insurance companies, brokers, and Federal legislators who are responsible for protecting the investing public. Just as they allowed for junk bond traders and crooked investment advisors to rob us in the past they are allowing unscrupulous tactics and greedy plan providers to do the same to us today under the 401k program.

While these problems have been just under the radar of most investors and basically ignored by the media they are beginning to draw some attention. You can only hide a rotten apple so long in the barrel before it’s found. Let’s hope these problems are solved before it’s too late.

If they aren’t I predict that the resulting scandals and losses for the investing public will make even the Enron and WorldCom frauds look small.

With that in mind lets take a look at these problems and discuss what if anything can be done about them and what you as a participant in a 401k program need to know to protect your investment.

Current 401k participation, vesting, and employer matching fund rules are designed to favor the employer to the detriment of the worker. Many plans won’t allow a new worker to participate for at least 1 year and they allow the employer to take back their matching funds if the worker leaves before having several years of service. Even worse than the 1 year wait are the plans that don’t allow for any new participants or changes except during a very limited time during the year. I’ve seen plans that only allow you to sign up for a one week period twice a year. That means that many workers effectively have more than a 1 year wait to sign on. This is much of the underlying reason for poor plan participation by younger workers. It’s just too easy to forget and fail to take care of starting a plan under this type of limitation. So while Employers promote their 401k programs as a fringe benefit and point with pride to their matching funds portions they know full well that many will never see any of these benefits. They put matching funds in only to get them back in the future when the employee leaves. That’s good for them but bad for the worker and it undermines the future of our retirement system by lowering participation. 401k programs should have an automatic registration and allow the worker to keep any matching funds paid into their account.


Worse many employers aren’t putting in the matching funds that they are required to under their plan. They simply keep the money and the worker is kept unaware that the program is under funded. This should be treated like the criminal action it is but it is seldom punished and this practice has been going on for far too long. Many of the 401k programs ran by troubled industries are under funded and it’s the workers and tax payers that will pay the price for retirement fund failures in the future.


Currently approximately 75% of the plans charge more, many times much more, that they charge for regular individual accounts. 401k plans should get a lower rate not a higher rate. They get away with it because it’s not fully or fairly disclosed to the plan participants what there rates are. So they do less work for more money while hiding the fact from the investors. There are no standards or rules that require a reasonable rate or service charge for 401k programs. That allows for greedy brokers and agents to charge far more than is justified for their services. While I hate legislation in such matters it is the only thing that will solve this problem. These practices hurt fund performance and undermine future value. A fund that has an investment of 500 dollars a month for 25 years and earns 9% interest will be worth approximately 561,000 dollars. If the same investment only earns 8% it will only be worth approximately 476,000 dollars. That’s a difference of 85,000 dollars over only 25 years. That’s an average of 3,400 dollars a year that’s lost to the investor. The worst offenders for over charging for fund management are the plans that are run by the insurance companies. They might not know how to get a good yield for you but they know how to get one for themselves. The resolution of this problem will require that employers have to be more accountable for the fees they negotiate for their plans. Currently they have no incentive to care what is charged as all of the expenses are paid by the investor and the investor has no say in these negotiations. Not the best arrangement to be sure.


And of course the investment advice that is given to investors in 401k programs is very little and lacking in depth. Worse yet investors are removed from the day to day activities of the fund and their investments. They are only receiving quarterly reports and they usually lack detail. So poor performance is the norm with ROI being less than it should be. To compound the problem a lot of the choices given to the investors are overly expensive mutual funds with little or no diversification. The average plan is heavily invested in the sponsor companies stock and has only two or three different funds being held at any one time. Plans should encourage investors to build around low load mutual funds or stock indexing funds that have little overhead and reasonable management fees. Maybe it’s time that the employers have to pay part of the fees so they would have an incentive to keep costs down.


Lots of plans limit drastically the choices of what mutual funds are available for investment. What chance does an investor have when their choice is between two funds that offer little difference in there costs or the rates of return experienced. To encourage workers to have more input and receive good third party advice would go far to alleviate the problems with ROI while encouraging diversification. As we stated in part 1 too many workers have much too large a share of their money in company stock which can be risky if something happens to you employer.


So does that mean that you should avoid 401k programs? Not at all. 401k’s are still one of the best investment options available to you. It just means that you must be careful and take control to prevent these problems from hurting your investment. It is possible to prevent much of the damage once you know the problems. Knowledge and information are power and they can put a stop to most of these problems. So what are the defenses you should be using?

Well,

Don’t be over eager to borrow against your 401k program. If you have to leave the company they will close out the loan. That will be treated as a withdrawal from your fund and as such will be taxed and possibly penalized as being an early withdrawal. You will have spent the money and now owe taxes and penalties that you don’t have available. Plus you can’t put the money back in so you lose the tax deferred growth that you had under your 401k program. Believe me over the years I’ve seen many people take a real beating because of 401k loans. Just imagine you’ve lost your job, had your 401k fund reduced by the remaining loan amount, and you get to pay taxes and penalties on the amount of the loan repaid, and you’ve already spent the money. That triple hit hurts.

Don’t take the money and run. When you leave a company roll your 401k over to an IRA. Never cash in a 401k early unless you ABSOLUTELY have no choice or you will take a hit in taxes, penalties, and the inability to replace the money. When it gone it’s gone and so are the tax deferred advantages of having that money earning within a 401k program. So how expensive is it to take money out early. With a 10% early withdrawal penalty, a minimum 10% federal tax, and your state tax (if you have one), you will pay 20 to 30% in taxes plus not have the money growing tax deferred. That means that if you took out 10,000 dollars you would take home about 7,000 dollars. It’s worse still if you are in a Federal tax bracket above 10%. That’s one way to go broke in a hurry. You might as well go to a loan shark at those rates.

And last but not least take charge it’s your money.

Demand to know what you are paying in fees and expenses and if they seem high ask if they can be lowered. Ask questions and don’t stop until you understand the answers as to what your investment choices are. Talk to other workers who are in the plain with you and seek safety in numbers. The more of you involved the more you can fight back against unreasonable charges.

Study your statements and be sure that they are correct. They make mistakes too and you need to watch them. Don’t be one of those people that I get at tax time that hasn’t even opened their statements and couldn’t understand them if they did. If you’re confused or don’t understand seek out an advisor to help you find answers.

Your financial health is much like your physical health. Get a second opinion on anything you don’t understand. Your tax preparer or accountant is a good place to start. They should be willing to take a look and help you with simple questions for little or no cost.

While your 401k is a long term investment don’t get over sold on buy and hold as your method of investment. It’s ok to buy something and sit back and wait just keep watch and bail out if it ends up not working out. Even long term investments need management and no amount of time makes up for sitting for years in a low yield stock or mutual fund just because you think that you aren’t suppose to do anything but buy and hold. Fortunes are lost using that formula.

I watched a person who worked at AT&T buy AT&T stock for years as it climbed higher and higher and split numerous times. The problem was that I then watched as AT&T began its long slide down with the investor holding on all the way. When it was over they didn’t get back their original investment. Stock that at one time was worth almost 200,000 dollars ended up brining only 23,000 dollars. They had invested almost 26,000 dollars so they lost 3000 dollars and because it was in a 401k all of the 23,000 dollars they took out was taxable while the 3,000 dollar lost wasn’t deductible. I just couldn’t ever convenience them that AT&T wasn’t going to come back. They had been so conditioned by the buy and hold philosophy that they just wouldn’t sell. That’s one client that I’ve always felt that I failed even though I preached to them every year when I did their taxes. I still feel that I should have been able to get them to bail out but I never could. I just wish I had another chance at doing that. I don’t know what I could have done that I didn’t do but I’d like the chance anyway.

But that’s a story of another article on another day.

WHAT’S GOING WRONG WITH 401k PROGRAMS?
Part 1

While 401k programs are one of the best choices for American workers to use when preparing for retirement there are troubling developments and warning signs of more on the horizon.

The study by the large global human resources company Hewitt Associates called "How Well Are Employees Saving and Investing in 401k Plans, 2005 Hewitt Universe Benchmarks," provides a detailed look at the first problem with 401k programs today, lack of employee participation.

While most employers (especially the larger ones) are seeking to educate their employees to the benefits of investing in 401k programs employees aren’t paying attention. The numbers of employees who precipitate in 401k programs has largely remained constant for the last few years.

After studying almost 3 million employees who could participate in employee sponsored 401k programs Hewitt found that the number of workers involved in such plans only increase by about 2% last year. That increase brings participation to only about 70% of all eligible employees with available 401k programs. So 30% (approx) of employees who could be participating in a 401k program have chosen not to do so.

That’s a disturbing figure and a worrisome trend at a time when it is becoming all the more important for workers to save more for their retirement not less. We face a time of uncertainly about Social Security in this country. What, if any, benefits will be available for future retirees under the Social Security System remains to be seen. So we need to increase participation in our retirement savings programs like 401k’s if we want to be assured of avoiding a financial crisis in the future.

We also face an uncertain time as to what will happen regarding inflation. While it’s been modest for awhile energy and energy related costs seem set to explode over the next few years. That could mean inflation will be much worse than current projections predict. If inflation rears its ugly head it could be the final piece in the puzzle that spells hard times for any future retirees that aren’t properly prepared. We may yet see retirees having it worse than any time since Social Security was implemented.

When you look at the best group in the study (those above 30) they only had an average balance of approximately 69,000 dollars in their 401k accounts. That’s much better than the under 30 group but that’s not nearly enough when you consider how long they’ve been saving. They need to do much better than that or they’ll be at the mercy of Social Security a time when it may not be there.

Of workers less than 30 Hewitt found that only about 46 percent participated in a 401k program. And worse yet one in four of this group had an average balance of less than 5,000 dollars saved in their 401k account. That’s certainly not going to provide much security in their retirement. This is the very group who can least afford to not be saving more for their retirement. It’s only by starting to save at a young age that most of us will ever manage to have any meaningful accumulation in our retirement accounts. It’s the magic of compounding interest over time that creates the necessary return on investment to provide us with financial security.

So participation in a 401k or something like it is critical and the younger we start the better. This study showed however that this isn’t what’s happening. We are starting later and trying to catch up by saving more as we get older. The wise course would be to reverse this and save while we’re younger and let compounding interest do the heavy lifting. The younger we start the less we have to save to have the same amount later on.

Employees also aren’t doing any better at diversification or developing balance in their 401k funds than they are about saving enough. They need to take responsibility and educate themselves so they can do a better job of seeking to keep funds invested in securities and financial products fitting their age and risk tolerance. It isn’t hard to lean enough to keep your funds spread among a group of securities to protect capitol, keep your risks manageable, and still make a good ROI.

Add to that the fact that far too many employees are keeping too large a percentage of their 401k accounts invested in the company that employees them. Just ask the former employees of Enron and WorldCom about the wisdom of not diversifying your portfolio beyond the company that you work for. A very large number of Enron and WorldCom workers learned about diversification too late to ever recover from making that mistake. Not keeping all of your eggs in one basket is still very sound investment advice.

And last but not least is the fact that Hewitt found that while almost 80 percent of employees who were in a 401k plan contributed enough to receive some company match in 2004 only one in three (31 percent) contributed enough to obtain the full company match. As many as one in five employees (22 percent) failed to contribute enough to obtain the full 401k company match. That’s giving money away by default and is just plain silly. If I ran an ad tomorrow saying that if you came and deposited money in your bank savings account I would match some portion of it I’d have people lined up for miles. Yet that’s just what your employer is promising to do and he has a hard time finding takers. So contribute enough that they give you all the money you can get through matching funds.


Well this brings part one to a close. We can wrap up what we learned in part one about 401k’s with this simply list;

1. Start saving as young as possible.
2. Take advantage of a 401k program if you have the chance.
3. Keep your holdings diversified for your protection.
4. Educate yourself so you can take responsibility for and manage your portfolio.
5. Give at least enough to get the ENTIRE employer match available.

Just remember financial security and peace of mind can be yours! It’s more a matter of discipline than anything else.

In Part 2 we’ll finish up our look at 401k programs and what else we have to worry about while investing in them.

(The entire study this article was based on “How Well Are Employees Saving and Investing in 401k Plans” is Available for $350 by contacting the Hewitt Information Desk at (847) 771-2500 or infodesk@hewitt.com.)

JANUARY 1ST 2005 IS A BIG DAY FOR 401K PROGRAMS.

Yes January 1, 2005 is rapidly approaching and with it the new Roth 401k will finally be available.

It offers to the 401k investor the advantages of escaping taxes on the growth of their 401k contributions just like the Roth IRA program has for individual IRA investors. I predict it will soon grow to be a major factor in many investors’ retirement plans. The growth of individual Roth IRA investor programs will pale beside what the Roth 401k’s are going to do. Finally we have a good investment vehicle that offers tax advantages as well as allows for decent contributions and it’s available to many if not most workers. It’s going to take off as soon as the investors realize what an opportunity it is.

Remember there’s going to be a lot of pressure on individual investors over the next two or three years to find their own security with Social Security benefits being placed in jeopardy. Doubt, Social Security, and retirement planning don’t go well together. (By the way stay tuned for an article coming soon on this blog that will discuss the Social Security issue in depth.)

Remember there’s no indication that any “private accounts” that end up being created under Social Security will escape taxes or experience good grow so stake out your claim on the future and contribute as much as possible to any IRA and 401k programs that you have available. (More coming soon on how to tell if your 401k is a good one and the danger that it is being under funded by your employer.)

Also remember only about 1/3 of the employers now offering 401k programs are signed on to offer Roth 401k’s on the January 1st start date.

If your employer isn’t one of them now is the time to start asking “Where’s my Roth 401k. Show me my Roth 401k.” You need to have the option to be able to make either Roth 401k contributions or standard 401k contributions based on your needs. Even if the Roth isn’t best for you right now that may change in the future so keep your options available!

Remember you need check out the new Roth 401k investment opportunity and see if it’s not something you should be investing in BEFORE January 1 so you have time to act as soon as it’s available too you.

BANKRUPTCY LAW CHANGES REQUIRE IMMEDIATE ACTION

Attention: All of you out there who are in a position to be thinking about filing for bankruptcy need to act quickly or risk losing the opportunity to file under the old bankruptcy laws.

It may already be too late in some areas due to filing delays and over loaded courts. So….. PLEASE….. If you have any thoughts on filing for personal bankruptcy yesterday was too late and there may not be a tomorrow.

The new bankruptcy laws as passed by Congress and signed into effect by President Bush are the most sweeping in years. Maybe the most profound changes for the average filer since the bankruptcy laws were first written are to take effect very shortly.

It will take away many if not most of the basic protections that have existed for those wanting to file Chapter 7 bankruptcy and force them into the much less desirable Chapter 13 bankruptcy repayment procedure.

I’m not going to bore you with the complete list of changes but this bill must have been written by the banks and credit card companies and given to the legislators who sponsored it.

Using the pretense of stopping bankruptcy fraud and misuse Congress has passed and the president has signed into law the worst piece of legislative skullduggery I’ve seen since tea pot dome.

The financial industry has finally gotten their way and the average bankruptcy filer will be the loser. This bill is more to enrich the financial industry than prevent fraud and misuse. What ever the banks and credit card companies spent on buying Congress off on this bill it was a bargain.

Basically the changes that will have the most negative impact are;

No longer will you get as much protection for your vehicles, your home, or other personal property. The protection left under the new law is a gutted version of what it was.

And worse yet are the new rules on how you figure you’re living expenses. Now you will use the IRS amounts allowed under the tax code not your ACTUAL expenses. This results in a much lower allowance for expenses. In many areas of the country the results are so low as to be ridiculous.

That one change alone will result in many filers being kept from Chapter 7 bankruptcy all together by distorting how much a filer has to use for repayment of debt.


That leaves filing for Chapter 13’s bankruptcy repayment their only option. Worse still using these low monthly expense amounts will require much larger monthly payments to pay off the filers obligations. You may be forced out of being able to file under Chapter 7 bankruptcy and then made to pay more under Chapter 13 bankruptcy.

Not fair but be that as it may it’s now the law so be prepared for the worst when you talk to your lawyer.

So now you know. File now or risk being forced to repay at greatly increased monthly payments.

I intend to write more on the new bankruptcy and what it means in a later article but I felt obligated to get this one out ASAP since time is running out for files to avoid this new law.