Fraudulent Production, Use, or Trafficking in
Telecommunications Instruments Modified or Altered to Access
Services18 U.S.C. § 1029(a)(5)
This Subsection (a)(5) became effective October 25, 1994, as part
the Communications Assistance for Law Enforcement Act of 1994, Pub. L. No.
103-414, § 206, 108 Stat. 4279. This first Subsection (a)(5) of 18
§ 1029 proscribes the use or possession of altered telecommunications
equipment, with the first Subsection (a)(6) following it proscribing the
possession of the hardware and software needed to alter the equipment.
For Federal jurisdiction, all 18 U.S.C. § 1029(a)(1)-(7) offenses must
"affect interstate or foreign commerce."]|
The Congress enacted this set of Subsections (a)(5) and (a)(6) (see
this Manual at 1026) at 18 U.S.C. § 1029 in
response to the split between the Tenth Circuit decisions in United
McNutt, 908 F.2d 561 (10th Cir. 1990), cert. denied, 498 U.S.
(1991), and United States v. Brady, 13 F.3d 334 (10th Cir. 1993) and
Ninth Circuit decision in United States v. Bailey, 41 F.3d 413 (9th
1994), cert. denied, 115 S.Ct. 2563, 132 L.Ed.2d 815 (1995). The
Circuit in McNutt held that a satellite television descrambler did
fall under the definition of an access device since there was no debit which
resulted to the legitimate viewer's account. The reasoning of the Tenth
in McNutt was that although the satellite television operators did
economic loss, the intent of Congress was to limit the application of the
only to cases of direct monetary loss. This same reasoning was applied by
Tenth Circuit in Brady in 1993. In Brady, the court,
McNutt, held that altered or "tumbled" cellular phone numbers are not
"access devices" under 18 U.S.C. § 1029 since no account is accessed.
Brady, 13 F.3d at 338-40.
The Ninth Circuit in Bailey, disagreeing with the Tenth
Circuit's McNutt and Brady decisions, found that the phrase
"account access" in the statute should be defined to mean "access to the
privileges permitted by virtue of the maintenance of an account."
41 F.3d at 417. The Ninth Circuit held that the existence of an actual
is irrelevant as long as the user of the access device is in any way "able
obtain goods or services from which he would be otherwise excluded.
at 418. Similarly, other circuits had held that both assigned and
account numbers are "access devices" within the meaning of 18 U.S.C.
See, e.g., United States v. Farkas, 935 F.2d 962 (8th Cir.
1991)(assigned); United States v. Taylor, 945 F.2d 1050 (8th Cir.
(unassigned); United States v. Brewer, 835 F.2d 550 (5th Cir.
1987)(unassigned); United States v. Caputo, 808 F.2d 963 (2d Cir.
Subsequent to the 1994 amendments, the Bailey case has been
followed by the Sixth Circuit in United States v. Ashe, 47 F.3d 770
Cir.), cert. denied, sub nom. Doughtery v. United
States, 116 S.Ct. 166, 133 L.Ed.2d 108 (1995), which also involved
of cellular phone numbers. In Ashe, the court specifically relied on
legislative history setting forth the purpose of the amendment
to criminalize the use of cellular phones that are altered or "cloned"
allow free riding on the cellular phone system. Specifically, this section
prohibits the use of an altered telecommunications instrument, or a scanning
receiver, hardware or software, to obtain unauthorized access to
telecommunications services for the purpose of defrauding the carrier. H.R.
No. 827, 103d Cong., 1st Sess., 31.
Id. at 774. Also, the Eleventh Circuit recently held in United
v. Morris, 81 F.3d 131 (11th Cir. 1996), a pre-amendment case, that the
for an account access as in McNutt was still required to obtain
applicability under 18 U.S.C. § 1029. However, the court specifically
indicated that under the amended Section 1029 it would follow the
and Ashe decisions. Morris, 81 F.3d at 134.
[cited in USAM 9-49.000]