As my wife shut down a Web connection the other day, her screen suddenly displayed a bright blue box with reverse-white lettering, much like the ones we used to see in the old DOS days. It looked like something generated internally by her own computer, alerting her to a problem and offering several options to click.

Before she clicked, however, we read it carefully. Turns out it was just another ad from a software maker desperate to get her to respond — this time by impersonating her own machine.

It’s not news that we’re in the age of the con. There are those get-rich-quick emails from people purporting to need help safeguarding Nigerian funds. There are those important government-looking envelopes with return addresses printed in an IRS-like typeface. In post-inferno California, officials are warning of unlicensed “contractors” sweeping through neighborhoods and promising to rebuild for you immediately — if only you’ll pony up $1,000 to get to the head of the list.

The other day CBS News’s “60 Minutes” aired a look at the latest ploy. It’s called “undercover marketing” or “viral marketing” — from the word virus, which spreads its infection from person to person. Viral marketing works by hiring actors or enlisting underage volunteers to hype products through friendly, informal interchanges at coffee shops, bars, and computer message boards. They never let on that they’re paid marketers. They simply pretend to be customers enthusiastic about a product.

One 13-year-old interviewed by “60 Minutes” promotes a new movie, “Cowboy Bebop,” by deliberately talking it up in teen chat rooms, in return for T-shirts and posters from the producer. “60 Minutes” also reports that Sony, when it released its camera phone, hired 60 actors in 10 cities. They posed as tourists, asking others to snap pictures of them and then falling into calculated conversations with the obliging passersby about this cool new gadget.

It seems that advertisers, having long recognized the power of word-of-mouth promotion, are finding a way to manipulate apparently friendly interchanges among the trendy to create a giddy buzz. As CBS correspondent Morley Safer wryly noted at the end of his piece, “If you think you haven’t run into an undercover marketer yet, well, that’s the point.”

What’s disappointing is that the news stories on these activities seem at a loss to analyze the ethical issues. They do capture a vague public discomfort, though in a tone that sometimes suggests a grudging respect for the inventiveness of the tricksters. But they leave unaddressed the core question: What’s the moral problem here?

Put simply, the problem is one of identity fraud. It consists of claiming to be something you’re not. As such, it inhabits a seamy territory populated by managers who lie on their résumés, journalists who pretend to be prostitutes to get stories, citizens who impersonate officers, denominational proselytizers who pretend to be “just folks interested in spirituality,” and students who exaggerate their exploits to win popularity. Asked why they do it, the more noble cite the benefits to society of having their self, their products, or their convictions better known. The more cynical invoke (perhaps more realistically) a version of caveat emptor: It’s up to the public to be smart enough not to get tricked, so anyone who’s duped deserves to be.

Noble or cynical, the upshot is the same: a degradation of trust. If everybody might be somebody else, nobody’s sure of anybody. The barriers of skepticism go up. The values that lubricate efficient interchange — including reliance, confidence, and expectation — start to erode. In the end, laws creep in where ethics used to tread, legislating our protection from scams but eroding our freedom to befriend.

Is that a worthwhile trade? In the post-9/11 age, we’re more willing to think so. Seeking more safety along the scale that stretches from liberty to lockdown, we grow more used to distrusting others. Ads that pretend not to be ads only exacerbate that distrust. Yet one of the effects of ethics is to engender trust in goodness. Viral marketing, creating distrust in goodness, deserves the disinfectant of a clear moral reasoning about why it’s wrong.

(c)2003 Institute for Global Ethics

“This is a huge victory for common sense. I am delighted with the ruling, delighted with its precision and resolve.”

– Mikhail Fedotov, secretary of Russia’s journalist union, speaking to Moscow Echo radio about last week’s court decision striking down a new media law preventing journalists from “taking positions on candidates and parties, or reporting on their policies,” according to the BBC. The law, which would have barred editorials and analyses of candidates’ past views in the run-up to December’s elections, “can lead to violations of freedom of speech,” the court said. (“Russian Court Rejects Media Law,” BBC, Oct. 30)

BOSTON
Putnam Investments, the nation’s fifth-largest mutual fund company, was hit last week with charges of securities fraud by the U.S. Securities and Exchange Commission (SEC), leading several states to drop their pension-fund holdings in the fund.

The charges are the first to be filed against a mutual fund company since New York attorney general Elliot Spitzer warned in September that he was probing wrongdoing throughout the mutual fund industry, reported the New York Times.

Putnam, which had $272 billion under management at the start of the week, saw its investors start to pull out following the allegations, which include short-term trading violations by some of its executives and wealthiest clients.

Four traders at Putnam have been fired for allegedly making quick in-and-out trades, often after the U.S. markets had closed — transactions known as market timing, which are specifically barred by Putnam’s policies.

The alleged violations at Putnam occurred from 1998 until 2003, and were exacerbated by the company’s reluctance to disclose the wrongdoing, poor detection policies, lax oversight, and an ineffective code of ethics, the SEC charged last week.

The charges, filed by both the SEC and state of Massachusetts, initially were rejected by Putnam, which denied wrongdoing but pledged cooperation, reported the New York Times.

The firm’s response to the government’s strong allegations spooked many state investors, which last week began yanking their funds from Putnam’s portfolios, reported the Reuters news agency.

Following the filing of charges, Massachusetts’ state pension fund dumped Putnam, pulling $1.7 billion in business. Iowa ($586 million) and Rhode Island ($651 million) followed suit; California and Connecticut are considering similar action, according to Reuters.

“There are some 95 million Americans who are invested in mutual funds, representing half the households in this country, and they deserve better,” SEC director of enforcement Stephen Cutler insisted last week. “We’re going to continue to be aggressive in pursuing appropriate enforcement actions where mutual funds abuse the trust of those investors.”

ALBANY, New York
Feeling pressured by the increasing weight put on standardized test results, a growing number of teachers are being caught cheating, according to a report last week from the Associated Press.

The AP piece highlights the situation in New York, where at least 21 cases of teacher cheating have been proven from 1999 to the spring of 2002.

Profiled cases — in New York, Ohio, Virginia, and elsewhere — include teachers reading answers to students during a test, helping students correct wrong answers to problems, using actual tests for practice beforehand, inflating scores, and sneaking peeks at tests in order to teach the answers, reported the AP.

“Teachers care a lot, sometimes they care too much and try to provide too much help,” Dennis Tompkins, spokesman for New York State United Teachers, the state’s largest teachers’ union, told the AP. “I don’t think our members are Machiavellian. I think they are just trying to help the kids do better.”

With standardized-test results increasingly tied to budgets, enrollment, and tenure, “teachers are under a lot of pressure to get good grades,” one cheating teacher told administrators, according to the AP report.

A recent Harvard study found similar problems in Chicago schools, where “cheating increased by 30 to 50 percent because of high-stakes testing,” study co-author Brian Jacobs told the AP.

LONDON
U.K. conglomerate The Co-op last week said it would help fund a network of business schools designed to teach the next generation of corporate leaders about the advantages of being “honest and responsible.”

The Co-op, which owns 1,800 supermarkets and the Co-operative Bank, has pledged nearly $850,000 toward the effort, which will run in seven schools in England, reported the BBC.

The schools will be chosen by the Specialist Schools Trust, the lead body for a controversial government program that aims to improve schools by subsidizing those that aim for excellence in a particular field.

The Co-op’s plan targets schools specializing in business. Seven schools would receive a combined $600,000 at the program’s outset, and nearly $34,000 each over the following two years, according to the BBC.

Co-op Group chairman Keith Darwin says the new program is designed both to further the Co-op’s mission of ethical business and to breed a better generation of business leaders.

“We are in business not simply to make a profit but to do something worthwhile with the profits they make, and we believe young people will benefit from understanding the advantages of doing business in a democratic, honest, and responsible way,” Darwin said last week.

OFENA, Italy
A surprise ruling by a judge in Italy, who ordered a crucifix removed from a classroom, has created a major controversy in the country, drawing strong rebuke from religious leaders and politicians and leaving many upset and confused.

Declaring that “crucifixes show the state’s unequivocal will to place Catholicism at the center of the universe … in public schools, without the slightest regard for the role of other religions in human development,” a judge ordered the removal of the cross from an elementary school in the small Italian town of Ofena.

The case was brought by a local Muslim activist, Adel Smith, whose children attend the school and who expressed concern about equality of religion under the law. Smith told the AP, “I have no fight with the crucifix…. I have simply been granted a constitutional right that religious symbols should not be on display in the classroom where my children study.”

While Catholicism was dropped as the official religion of Italy in 1984, a 1920s law requiring schools to display the crucifix is still technically in effect.

The decision has sparked public outrage among the country’s religious leaders and elected officials. The New York Times reports that Italian president Carlo Azeglio Ciampi responded to the ruling by stating, “The crucifix has always been considered not only a distinctive sign of a particular religious credo, but above all a symbol of the values that are at the base of our Italian identity.”

Labor minister Roberto Maroni told Reuters, “This is an outrageous decision that should be overturned as quickly as possible. It is unacceptable that one judge should cancel out millennia of history.”

Not everyone, however, was displeased with the judge’s decision. Armando Catalano, head of the education branch of Italy’s largest union, CGIL, told the Washington Post, “It’s a courageous, innovative, and modern decision that underlines the lay state. We have to confront the fact that schools have fundamentally changed.”

Similarly, the parent of a primary-school student in Rome told the BBC, “So why have a religious symbol from one religion in every class in every school? I think it should be removed.”

ANNAPOLIS, Maryland
The U.S. Naval Academy last week stripped a history professor of his tenure and $10,000 in annual salary after concluding that he plagiarized dozens of passages in a book about the atomic bomb.

Brian VanDeMark, author of Pandora’s Keepers: Nine Men and the Atomic Bomb, was found to have lifted — verbatim or nearly so — from at least four other authors, reported the Washington Post.

An investigative board at the Naval Academy concluded that VanDeMark had engaged in “sloppy scholarship” that included “improper borrowing and inadequate paraphrasing.”

“These improprieties constituted plagiarism,” the academy said in a statement, wrapping up an investigation launched in June.

While at least two of the plagiarized authors said VanDeMark should be fired, the Naval Academy, citing mitigating factors, said demotion and a pay cut would suffice, reported the local Capital newspaper.

While VanDeMark’s violations were the result of “gross carelessness,” they were not “a deliberate effort to pass off the works of other authors as his own,” the board concluded.

The Naval Academy stripped VanDeMark of his position as tenured associate professor, reclassifying him as an entry-level assistant professor earning $10,000 a year less.

“I reiterate my personal responsibility and accept accountability for my unintentional mistakes,” VanDeMark said last week in a statement. “Pandora’s Keeper was a big undertaking … and I became overconfident about paraphrasing a lot of secondary sources.”

To regain tenure, VanDeMark must satisfy research and publishing requirements, as well as three years of probation. He also must correct Pandora’s Keeper, which has been recalled by publisher Little, Brown and Co., before it is republished, according to the Post.

JERUSALEM
Israel’s military, repeatedly accused of violating the rights of Palestinians, last week deployed a CD-ROM with ethics lessons for its troops.

The CD-ROM, which includes clips from U.S. military-themed movies “Platoon” and “Rules of Engagement,” also contains lessons on legal doctrine and quizzes on ethics, reported the Associated Press.

The Israeli army last week began sending the training tool to field commanders and border police with instructions to share the material with their units. Scenarios on the tape include scenes examining the use of human shields and firing into crowds of demonstrators.

“The pressure in terms of decision making we’re placing on these 19-year-old soldiers is absolutely incredible,” Lt. Col. Amos Guiora, commander of the Army’s School of Military Law, told the AP.

Guiora said the U.S. Army has expressed interest in an English version of the program.

SAN JOSE, California
Moving more quickly than usual, the U.S. Food and Drug Administration (FDA) last week banned the sale and use of a recently synthesized steroid in a move that received widespread praise.

The new steroid, tetrahydrogestrinone, or THG, was discovered by Dr. Don Catlin, head of the Olympic drug testing lab at the University of California in Los Angeles, after an anonymous coach sent in a syringe containing the drug.

Catlin congratulated the FDA on its action, telling the New York Times, “They understood [the severity of the situation], they got the message, and that’s really very, very nice.”

Several sports organizations also quickly fell in line with the ban this week, including the National Football League (NFL), the Olympics, and the International Ski Federation.

Harold Henderson, executive vice president of the NFL management council, announced a ban of the steroid and told the Times, “My position is that it is a steroid and we treat it exactly like we treat steroids,” Henderson said. “They’re banned, they’ve always been banned, we test for them, and whenever we have a test for them, we take action when we find positives.”

The International Olympic Committee also announced that THG is now on the list of banned substances. According to the Associated Press, athletes at the 2004 summer games in Athens, Greece, will be tested for it. According to the Times, the IOC also is looking into the legality of retroactively testing samples from athletes at the 2002 winter games in Salt Lake City, Utah.

THG is manufactured by California-based Bay Area Laboratory Co-Operative (BALCO), which was raided by the IRS and local drug control agents in September. The company is currently the target of a grand jury probe.

Dr. Andrew Pipe, chairman of the Canadian Center for Ethics in Sport, summarized the situation to the AP: “Are we ever going to get rid of doping from sports? No. One of the unfortunate things about sports is that humans participate in them, so we see some of the most sordid elements. What we have is more than a drug problem — it’s a values problem.”

The government also is looking into the problem: Senators Joseph Biden (D-Del.) and Orrin Hatch (R-Utah) last week introduced a bill that would add THG and similar substances to the list of banned drugs under the federal Controlled Substances Act.

WASHINGTON
Twelve states and more than 20 cities joined forces last week to sue the U.S. Environmental Protection Agency (EPA) over relaxed air-pollution laws that they say will harm human health, the environment, and the economy.

The state and local governments are hoping to block the Bush administration’s relaxation of Clinton-era regulations known as new source review (NSR), reported the New York Times.

Those laws required the nation’s older, coal-burning facilities to upgrade their anti-pollution technology when undertaking anything more extensive than routine repairs. The new, relaxed version eliminates that requirement unless the repairs or upgrades cost more than 20 percent of the plant’s value.

Critics contended that the NSR regulations were too costly and confusing, intimidating the nation’s power plants, refineries, and other industrial facilities from making needed repairs. Supporters say the rewritten law essentially guts part of Congress’s Clean Air Act and its anti-pollution mission.

Last week, after the relaxed version of NSR officially became law, Northeastern states filed a flurry of lawsuits, warning that nearly 17,000 older facilities continue to churn out polluted air that descends downwind onto their lands and into their lungs.

“It is clearly in the public interest to challenge” the new NSR regulations, Pennsylvania State Department of Environmental Protection secretary Kathleen McGinty said. “We cannot stand idle while it happens.”

Last week’s lawsuit coincides with a report from the nonpartisan National Academy of Public Administration, which endorsed a study that found the NSR “change could lead to a 1.4-million-ton increase in air pollutants in 12 states,” reported the Pittsburgh Post-Gazette.

The EPA denies that finding, releasing a statement last week that said the new version of NSR “preserves the public health protections” and will not significantly increase emissions, reported the Associated Press.

Plaintiffs in last week’s suits include the states of Connecticut, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New Mexico, New York, Pennsylvania, Rhode Island, Vermont, and Wisconsin, and the cities of New York, San Francisco, and Washington. Also joining the suit are the American Lung Association, the Natural Resources Defense Council, the Sierra Club, and the U.S. Public Interest Research Group, among others.

Special to Newsline from Canadian correspondent Errol P. Mendes

TORONTO
Just a few months after the Rolling Stones came to the rescue of Toronto’s tarnished image following the SARS crisis, major Canadian music stores are boycotting and pulling off the shelves all Rolling Stones products after the rock group signed an exclusive deal with Best Buy Co. Inc. and its subsidiary Future Shop Ltd. stores to sell its latest four-disc DVD set called “Four Flicks.”

Rival store owners say the exclusive deal is unfair because it will give Best Buy a monopoly on what is expected to be one of the hottest products of the Christmas season. The set is due to be released November 11.

The Globe & Mail is reporting that one major Canadian music store, HMV Canada Music Stores Inc., is looking into making a complaint to the federal Competition Bureau arguing that the deal is unfairly impeding competition in the industry.

Other stores are arguing that the rock group is getting greedy and ignoring the fact that the Stones have made a lot of money with music stores across Canada.

However, the Globe & Mail is reporting that Michael Cohl, the music promoter who helped organize the Toronto SARS concert, is defending the group’s exclusive deal by pointing out that the arrangement helps keep the price of the DVD set $15 to $22 lower than it would have been without the exclusive deal.

From The Chronicle of Philanthropy:

“For the first time in a dozen years, contributions to the nation’s largest charities declined in 2002, the result of continuing economic uncertainty among donors and heightened competition for money among charities, according to The Chronicle’s 12th annual Philanthropy 400 survey.

“As a result, many groups have altered their fund-raising approaches, and they are bracing for years of financial challenges. A number of charities have begun to focus on their long-term fund-raising prospects by adding staff members and sponsoring events to try to attract more major and planned gifts. Other groups are stepping up their marketing efforts or working closely with corporate donors to bring in more money.

“As they look forward to better times, many charities are trying to put last year — one of the toughest for fund-raising in memory — behind them. Donations in 2002 declined 1.2 percent, after adjusting for inflation, compared with an average annual gain of 12 percent during the previous five years. Aggregate donations among the groups in this year’s survey totaled $46.9 billion, down from $47.5 billion last year….

“While many big groups struggled, several smaller and midsize organizations made some of the largest gains in cash donations in 2002….

“Money collected in connection with the September 11, 2001, terrorist attacks helped to bolster fund-raising totals for several groups. As a result of the $1.1 billion given to its September 11 fund, the American National Red Cross (No. 1) bumped the Salvation Army (No. 2) from the top ranking for the first time in the survey’s history. Over all, the Red Cross brought in $1.74 billion — a 161-percent increase from the 2001 fiscal year….

“Despite a decline in support in the 2002 fiscal year and continued uncertainty about a turnaround in the economy, many charities remain optimistic that the worst is behind them….”

“The greatest and noblest pleasure which men can have in this world is to discover new truths; and the next is to shake off old prejudices.”

– Frederick the Great (Frederick II, Prussian king, 1712-1786)