EXISTING LAW - CASE STUDY 2

Case study 2 - Borislav Misic - T1933/98
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Mr Misic arrived from Yugoslavia on 16 April 1998.  On the 17th or 18th of April 1998 he purchased a computer.  On the 18th of April he copied a programme from the Internet which was a programme that enabled him to make thousands of "free" toll calls using the Telecom system and the Internet.

Upon arriving in the country he had five telephone lines installed into his flat.  This enabled him to make 60 hours of calls in any 24 hour period. 

Telephone networks use signals by way of sounds to communicate.  The programme he had obtained from the Internet imitated those sounds and was able to fool some of the third world overseas telephone networks (which were not as sophisticated as New Zealand), to believe that a free line should be made available to the caller.

This type of network fraud is known as "phreaking" where an individual specialises in stealing or manipulating telecommunications networks in order to make free long distance calls.  Apparently, the term "phreaker" originated from the US as typically the type of people likely to do this were teenagers with a passion for computers, who were nerds and therefore called freaks.

In one month Mr Misic made some $21,000 worth (about 88,000 minutes) of free calls from those five lines that he had obtained in his flat.  It was because of the large number of calls that this offending came to the attention of Telecom.

Offences Charged

Mr Misic was charged with:

1 Obtaining a document (the software to commit the offences) with intent to defraud

2 Using a document (using that software) with intent to defraud

3 Reproducing a document with intent to defraud.

This was the first Internet prosecution of its kind in New Zealand and consequently there was considerable argument as to whether a computer programme could be a document.  This case went to the Court of Appeal and the Court ruled that a "document" was a thing which provided evidence or information or served as a record, therefore it did not matter whether it was in the form of written material, a tape recording, videotape or a programme stored on a computer system.  (R v Misic, Court of Appeal, Wellington CA 454/00, 11 April 2001, Anderson J).

He was convicted of all charges and was sentenced to 12 months' imprisonment suspended for two years together with six months periodic detention.