HOT TECHNOLOGY ISSUES in the World of E-COMMERCE.

• Author: WILLIAMS, COLLEEN MADONNA FLOOD

From digital signatures to e-checks, technology improves to ensure security.

Most purchases that are made over the Internet today are made with a credit card, user name and password. Merchants need to be aware that these types of transactions do not legally bind consumers in many states to pay for their purchases. Why not? Well, because the consumer has not actually signed anything. A credit card company would have a difficult time proving that a cyber thief didn't make the purchase if the consumer claimed that was the case. Digital signatures, certificates and secure socket layer technology are tools that can help solve this problem.

President Clinton signed the Electronic Signatures in Global and National Commerce (E-SIGN) Act into law in June of 2000. That legislation cleared the way for legally binding digital signatures for everything from auto loans to home mortgages. The federal government is boldly moving even further into the paperless world of e-commerce, in accordance with the Government Paperwork Elimination Act. The act expects federal agencies to offer people the option of submitting data electronically. Agencies are supposed to be able to accept digital signatures and provide appropriate security for electronic information by Oct. 23, 2003.

Digital signatures could prove to be very profitable cyber tools, eliminating time, paper, pens, face-to-face meetings.... But, just what is a digital signature? And how do you know it is really the signature of the person that it claims to represent? Are e-contracts, e-checks, and online accounts safe? Here's what you need to know.

DIGITAL SIGNATURES DEFINED

Digital signatures are created and verified using cryptography. In layman's terms, messages are transformed into codes that appear to be unintelligible and then are turned back into intelligible messages, using digital signature technology. Digital signatures use public key cryptography.

Public key cryptography is the use of an algorithm featuring two different but mathematically related keys. One key creates the signature, or puts the data into its code form. The other key is used to verify the digital signature and decode the message.

The computer equipment and software used to create digital signatures is referred to as an asymmetric cryptosystem. The keys of an asymmetric cryptosystem for digital signatures are often called the private key, which is used by the signer to create the digital signature and encode the message, and the...