Ever since the 1980's, with the dawn of the information era, technological developments have

increased in pace, requiring legislators and regulators to work much faster than they had previously

been required. In some cases, laws became obsolete sometimes even before the legislative process

had finished.

Recent technological developments have dawned a new virtual era, in which one can cause events

to occur all around the world without leaving his room. Moreover, private actors are now able to

encrypt information beyond the reach of the government, and even produce end products, such as

weapons, hidden from the eyes of any regulator.

These changes have brought an added difficulty to the legislative process, changing basic concepts

such as "place" and "possession", entangling even more the basic enforcement process. When

national borders lose their meaning and when money can travel all over the world, without being

connected to an identified person and without leaving a trace - enforcement agencies all over the

world are hitting insurmountable barriers.

In parallel to these events, many technological advances have also brought to the demise of

traditional financial institutions, and the rise of trust based systems. Application such as AirBnB,

Uber and Kiva, which rely upon direct transactions between individuals, based upon documented

reputation have replaced Taxis, Banks, Hotels. Online dispute resolutions (ODRs) are becoming

more common, when people volunteer to partake in online solutions in place of the old judiciary

system.

Will these new trust based systems replace failing enforcement establishments? Should the

government enable public private based cyber enforcement? If so, how far voluntary participation in

enforcement should be enabled. This study will try to differentiate between investigations, judicial

and penal systems. The study will study will examine unique issues which may come up in each

enforcement avenue. Will we allow apps to punish? Can the government control this process if the

ball starts rolling?

In App We Trust

Study Proposal

Introduction

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This study will try and question our response when technology not only hastens the pace of lives,

but also changes fundamental concepts of our legal system – specifically our ability to enforce laws.

First, I will review recent changes and try and show that while the information era brought about

rapid, yearly and sometimes even monthly changes in technology, the virtual era has added another

aspects changing basic conceptions of physical place, physical borders and provided private citizens

with abilities which were once only in the realm of the state.

I believe that this review will show that by itself, law cannot accommodate both for the speed and

for the changes in basic legal concepts – resulting in laws becoming unenforceable, and the

institutions which enforce them becoming obsolete.

The second part of this study will try and analyze whether trust based systems, currently

implemented in business models such as AirBnB and Uber, can substitute traditional enforcement

institutions- investigative, judicial and punitive – and show how these changes may impact our

perception of how law will work in the near future. I will try and discuss the difficulties such

systems may pose, to constitutional basics, to the power of the sovereign over the people, practical

difficulties and more.

I. From Evolution to Revolution

Since the 1980’s with the advent on the information era, technology has been developing in an ever

faster growing pace. This rapid development has required the law to adapt much faster than it used

to1. Legislators, which have always been slow to react, have been struggling to respond2. Numerous

scholars have suggested various ways of assisting bureaucracy of legislation to work faster and

adapt – either by less specific legislation or by transferring regulation to technology-focused

agencies which can adapt quicker3. These studies presume, in my opinion, that technological

advances are a linear upwards process, so if we'll do the same process only faster, we'll have a

solution.4 The problem is that in the past few years, technological evolution has not only increased

in pace, but has also changed basic core interactions between people. People are not really where

they seem to be, money has nothing to do with physical presence, and a person can physically harm

another without even entering a victim’s room.

Living in the Virtual Era

In recent years, we are witnessing the challenges faced by enforcement entities when trying to

enforce the law. These difficulties are the result of simultaneous advances in technologies providing

private actors with abilities which together make enforcement an impossibility:

1 Joel R. Reidenberg, Lex Informatica: The Formulation of Information Policy Rules through Technology , 76 Tex. L. Rev. 553 (1997-1998) Available at: http://ir.lawnet.fordham.edu/faculty_scholarship/42.2 Cameron S. D. Brown, Investigating and Prosecuting Cyber Crime: Forensic Dependencies and Barriers to Justice, International Journal of Cyber Criminology, Vol 9 Issue 1 January – June 2015.3 For example: Lawrence Lessig, Code and Other Laws of Cyberspace (1999). another opinion in Haim Wismonsky, CRIMINAL INVESTIGATION IN CYBERSPACE, (2015), 335-336.4 Lawrence Lessig, The Zones of Cyberspace, 48 STAN. L. REV. 1403 (1996).

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First is the ability of a virtual actor to choose where he operates from, disregarding political borders

and legal physical confinements. Second is the ability to hide your identity from the government

using either advanced encryption or untraceable proxy based systems. Third is the ability to conduct

a substitute economic system, disregarding the classical government regulated systems, allowing for

actors to get payed and buy products without leaving a trace and without a physical identification of

the participant.

Here are some examples:

Nowadays, Israeli scam artists, working from undisclosed offices in the greater Tel Aviv area, have

been targeting French citizens receiving fraudulent funds without leaving their rooms5. Money is

transferred easily to different places around the world, and cashed without a trace. Victims do not

know where their perpetrator came from, authorities have problems investigating, let alone

enforcing violations conducted outside their jurisdictions, and enforcement is lacking since money

cannot be recovered since it was lost during endless transactions.

Another example is encryption capabilities, which were once the realm of clandestine agencies and

superpowers, and now have become house hold products. These days, any user can choose to

encrypt his or her information in such a way that no one will be able to access unless given the

access key.

First consequence of these house hold super-encryptions, has recently come up in the media, after

the FBI was forced to appeal to a Federal District Court to force Apple Inc. to develop a back door

to an encrypted iPhone it had gathered during an investigation6. The iPhone had belonged to a

terrorist who was no longer alive and suspected to contain valuable information. If in the past, the

use of outsider experts was a rare occasion, it seemed that a simple locked iPhone had become an

insurmountable task for one of the world’s strongest agencies – which eventually had to go to the

private sector for help.

Second consequence is ransomware7, which is causing havoc in the business industry. After

inserting ransomware into the target company - the software encrypts all the valuable data rendering

it inaccessible. To open the files, the company must transfer a determined amount within a limited

time. In many cases, the victims don’t even bother going to the police, preferring to just pay the

ransom, instead of losing reputation from even acknowledging that they had been compromised.

In the past, money transfer points were a very efficient way to locate someone for either criminal of

civil enforcement purposes. When trying to withdraw funds, local fiscal systems were built to

identify the subject, and would assist relevant parties. Today, using systems such as bitcoin,

5 http://www.timesofisrael.com/the-wolves-of-tel-aviv-israels-vast-amoral-binary-options-scam-exposed/6 https://assets.documentcloud.org/documents/2714001/SB-Shooter-Order-Compelling-Apple-Asst-iPhone.pdf.7 Luo, Xin, and Qinyu Liao. "Ransomware: A new cyber hijacking threat to enterprises." Handbook of research on information security and assurance (2009): 1-6.

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criminals are able to conduct transactions without ever needing to actually withdraw local currency

in the old fiscal systems - rendering them undiscoverable.

Bitcoin has become such a rising power, that it has even started to challenge the Chinese economy,

with many of its richest citizens using bitcoin to smuggle assets out of the country. This unregulated

export of funds has caused a political threat to local Chinese policy since it enables the rich and

wealthy to conduct business without the consent government oversight.

These examples are of course only few and testify as to the great difficulties the virtual era has

brought to classical enforcement systems.

Law in the Virtual Era

Academics8 and Judges have commented on the difficulties of the legal system to adapt as quickly

as required9. This has been the case in the verdict regarding gambling in Israel, and also verdicts

regarding searches of emails in the United States. The problem is that most of these rulings and

several legal studies premise that if the law advances quickly enough it can catch up eventually10.

I’m not sure that this is the case.

The problems raised by the virtual era go to the very core concepts of criminal and civil

enforcement. Questions such as the definition of “place” and the ability to conduct activities from

anywhere to anywhere, create not only practical enforcement issues, but also conceptual issues

which make applying old legal doctrines problematic.

For instance, let’s hypothesize an Israeli based web-surfer who conducts a sexually oriented

conversation with a 13 year old boy in the Philippines, asking the young child to expose himself

using his web camera. Since the age of consent in the Philippines is 12 years, the required double-

criminality for international enforcement does not apply and the Philippine government cannot help

in the investigation. Even Israeli enforcers will have troubles enforcing - this anonymous web surfer

did at no time actually possess illegal pedophile material, since it was online viewing and did not

control the data at any point.

Let’s say that during the pedophile conversation the web surfer decided to record this conversation,

saving it directly in the “cloud”. Does this make the company holding the video file culprit to the

crime? can the boy (or someone on his behalf) sue? The example shows how the virtual era has

created different statuses for having information - the person who owns the physical server, the

person who has digital rights on the data and the person who can access the data technically. All

new concepts.

8 Dr. Michal Agmon Gonen, “The Internet As A City of Refuge?! Legal Regularization In Light of the Technological Possibilities for Circumvention and the Global Nature of the Net [Hebrew]”, Legal Network: Law and Information Technologies, 207, (Niva Elkin Koren and Michael Birnhak Ed., 2011-5771)9 For example: 8464/14 State of Israel vs. Nir Ezra, 2015, Microsoft v. United States, No. 14-2985 (2d Cir. 2016).10 Kerr, Orin S., Searches and Seizures in a Digital World (2005). 119 Harvard Law Review 531 (2005).; GWU Law School Public Law Research Paper No. 135. Available at SSRN: https://ssrn.com/abstract=697541

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Basic legal doctrines regarding what is “possession”, what is “use” and even the definition of

“thing”, which are required for the enforcement of rules regarding thievery, illegal possession etc.

are no longer valid. This is not only true for the penal code, but also for administrative law - such

was in a case where the Israeli police could not close an online gambling site, since the courts

decided that letters of the law could not be automatically translated to cyberspace where term such

“site” and ‘close” did not mean the same anymore11.

No Enforcement No Law

Even if all these challenges are met by the legal system, which is very unlikely, no sooner than they

are solved will newer problems arise. This means an ever growing problem of a failing state.

Information can flow without regulation, territorial borders have less meaning, financial institutions

become less relevant and even mass production changes face when people can produce end

products using the ever-advancing home 3D printers.

If laws are not enforceable they lose their meaning. If laws are relevant only in a specific society,

other than that in which all actors conduct their business - then they have no existence. The systems

which are in place and depend on those laws also face danger of becoming obsolete. What will

happen next?

II : Why Not Trust Based Enforcement

As most travelers do, when flying abroad, I often use AirBnB to find suitable & cheap

accommodation. By using AirBnB I rely on private people to provide me with a suitable

accommodation - even though I have not previously met them. I chose to do so, because new

technology has been able to facilitate trust based transactions. After consecutives successes, I trust

this system and the information it provides. I have unified standards with other users all over the

world, and I believe that the site/app will provide me with true data.

Many scholars have noticed12, that as public trust in traditional institutions winders, people are

moving more towards trust based, decentralized systems, which facilitate direct transactions

between private players. Different applications around the world such as Lyft, Uber for

transportation, Kiva for private loans and many others - are replacing older models of transactions.

As older, less efficient models become difficult to use, they are being replaced by trust based

models built on the idea that reputation and collaboration can provide an efficient substitute for

traditional models.

Online Dispute Resolution (ODR) systems are the first signs of such trust based enforcement

systems, though only in civil disputes, with some claiming that ODR systems are more efficient

than the conventional judicial systems, offering better solutions, quicker and cheaper comparing

11 AAA 3782/12, Tel Aviv-Jaffa District Commander v. Israel Internet Association12 Rachel Botsman, The Changing Rules of Trust in the Digital Age, Harvard Business Review, 2015, at: https://hbr.org/2015/10/the-changing-rules-of-trust-in-the-digital-age.

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civil procedures in court .Nowadays we buy on Ebay, and pay with PayPal to conduct business with

foreign merchants. We trust eBay to get our money back, and trust PayPal that it will guarantee a

safe transaction partially because Ebay has a dispute resolution system which has gained the trust of

both sellers and buyers.

These changes brings up the question if traditional enforcement is declining, whether trust based

systems will come in its place. Will there comes a day when I rely on an ‘Epolice’ app to help me

locate and even punish a person who has done me wrong?

The Implications of Trust Based Enforcement Systems

At this stage, the questions rising from implementation of trust based enforcement systems are very

rudimentary, and I hope will clarify as I deepen my study into this field.

First, I will try and analyze the different arenas of enforcement in which such systems may try and

influence. I will differentiate between apps allowing people to investigate instead of the police from

allowing and apps which will arbitrate in disputes. Another different enforcement arena which I will

try and analyze will be crowd based penal systems, which if unchecked may formalize mob

mentality.

Following the initial analysis I will try and ask what are the constitutional aspects of having trust

based systems in each arena. I will ask when should the state intervene (if it can) and disrupt the

substitution of the state with trust based apps.

I will try and see when trust based systems actually assist in protecting civil liberties and when do

we risk, in the guise of trust-based systems, allowing for the few to control the many who may

become dependent on a specific application.

I will try and ask if it is correct to even theoretically allow an app to conduct searches and seizure,

or even to virtually imprison, or perhaps virtually execute, a private actor. As the study progresses, I

will hope this questions will formalize into more coherent sub questions.

Goals of the Study:

The first goal of this study will initially try and map the impact the virtual era has on the ability of

enforcement agencies to react to changing technologies. The study will try and see whether the

effects of the virtual era are only pragmatic or are they deeper, and if the effects are only temporary

or are they here to stay.

After mapping the effects of the virtual era, the study will try to see whether law and law

enforcement can accommodate changes in the technological environment thus maintaining efficacy.

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If enforcement institution can accommodate, the study will try and see how can this be done, if the

law needs to change and if institutions need to rearrange.

If the effects of the virtual era are too fundamental to be addressed merely by either legal or

institutional adaptations - the main goal of this study will be to see if trust based systems, a business

model which has seen revival in the business sector - are applicable in replacing failing institutions

and legislation.

In this sense, the final goal of the study will be to try and offer trust based enforcement systems as a

viable substitute for traditional law enforcement institutions. This will be done by trying to show the

added value and map where these types of solutions can work and to what extent. This section of

the study is an academic exercise in trying to asses future possible forms of trust based enforcement

systems and how will each form impact existing legal systems and legal norms.

This study has several unique aspects which differentiate it from others:

Most legal studies until now have focused on what is the required legal changes at any given

moment. This study is first to ask if the law can really catch up, and look at the legal questions from

an institutional point of view.

This study is innovative in offering trust based systems as possible substitutes to enforcement

systems. Until now there has been no study to cross between these two different areas.

This study has a potential added value for further insight as the researcher is a forensic computer

specialist with both legal and technological background. Since the research is interdisciplinary in

nature, knowledge in both areas can help solve questions either from a technological point of view

or from the legal one.

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