All the indictees, says the Times, will be charged with four felonies: "Using of false or fraudulent pretenses to obtain confidential information from a public utility, unauthorized access to computer data, identity theft, and conspiracy to commit each of those crimes."

What this means: Investigators that took the Fifth in the Congressional hearing may still have to relinquish evidence of their allegedly fraudulent tactics. This could reveal, as Dunn has claimed, that HP isn't the only major company dabbling in phone fraud. Oh boy, who's next?

It also means the Times needs a new shot of Dunn, because their current one with the bald men knocking heads behind her is getting old.

California to Indict Former Leader of H.P. [NY Times]

Hewlett-Packard Co. chief executive Mark V. Hurd approved an elaborate "sting" operation on a reporter in February in an attempt to plug leaks to the media, according to an e-mail message sent by HP Chairman Patricia C. Dunn.

BusinessWeek (Tuesday):

Chairwoman Patricia Dunn and the company's general counsel [Larry Sonsini] have agreed to testify next week before a House panel investigating the affair.

SF Chronicle:

The House Energy and Commerce Committee on Wednesday gave the chairman of its oversight and investigations subcommittee the power to issue subpoenas in connection with the HP hearing.

And:

On Wednesday, the New York Times reported that HP's investigative team even considered infiltrating the newsrooms of Cnet and the Wall Street Journal by deploying investigators posing as clerical employees and cleaning crews.

Right, so now Hurd, the last good guy left in charge at HP and the board chairman-to-be, is implicated in the scandal that forced his predecessor Dunn to resign. We'll see what he has to say tomorrow in an HP press conference.

HP CEO Allowed 'Sting' of Reporter [Washington Post]
Hewlett-Packard to hold press conference [BusinessWeek]

It's a hard movement to fight — everyone's afraid of being marked "pro-child-porn" — but it would give the government, fraudsters, and determined hackers easy access to every Internet user's history. It's part of Gonzales's effort to control what anyone can see — whether it's library patrons using censored Internet connections or home users unwittingly telling the government whom they e-mailed, called, or Skyped. It's scary as hell and it's succeeding.

Gonzales: ISPs must keep records on users [CNET]

Pretexting is lying. Wikipedia says: "Pretexting is the act of pretending to be someone who you are not by telling an untruth, or creating deception. The practice of pretexting typically involves tricking a telecom carrier into disclosing personal information of a customer, with the scammer pretending to be the customer."

It's common. The Washington Post says: "A security specialist said it has been a 'tradition for decades' for chief executives of big companies to hire private investigators to spy on colleagues, calling it a 'common power play.'"

It's easy. "All you need is the last four digits of a Social Security number and a correct ZIP code," a repossession investigator told the New York Times, and "you can view the bill."

It works. Hewlett-Packard's probe outed board member George Keyworth as the leaker who shared important business information with CNET.

It's unethical. At least according to a former president of a trade group, the National Council of Investigation and Security Services, quoted in the Times.

It's illegal. The Gramm-Leach-Bliley Act outlaws unauthorized attempts to gain personal nonpublic financial information. (Lawyers disagree on whether the ban applies to phone records.) Phone providers view pretexting as illegal and sue those who attempt it. This is why many investigators say they've stopped the practice. A bill in the California State Senate could make the offense a state crime punishable by up to a year in jail.

It got Patricia Dunn and superstar lawyer Larry Sonsini in trouble. As chairwoman of HP, Dunn authorized the leak investigation that included pretexting for phone records. Dunn now says she did not know of or authorize any pretexting. Also, the San Jose Mercury News obtained e-mails in which Larry Sonsini (outside counsel to HP) told former board member Tom Perkins that this investigation was legal.

The phone companies are fighting back. Most notably, Verizon is pushing against pretexters and other dealers in personal phone records. For example, the company settled with a records vendor who agreed to stop selling phone records and to share how they obtained those records.

This isn't the last scandal we'll hear. The president of one security company says that heads of Fortune 500 Companies hire "fly-by-night organizations" to do their dirty investigative work all the time. Now that a pretexting scandal is front-page news, expect investigative journalists to hunt down similar stories.

Pretexting [Wikipedia]
When a Stranger Calls, Beware of The Pretext [Washington Post]
An Industry Is Based on a Simple Masquerade [New York Times]