The pen is mightier than the electronic signature

By In the Works . Paul Hoffman
Network World, 07/24/00

It's not often that you can get Internet legislation passed nearly unanimously in both Congress and the Senate, then signed with a flourish by the president. To some people, such a law must seem a truly wonderful thing, sure to bring peace and harmony and increased profits through e-commerce. To the rest of us, it's a sure sign the law doesn't do anything useful. Such is the fate of the new Electronic Signatures in Global and National Commerce, dubbed the E-Sign law.

The first tip-off to security experts that this law might be less than it seems is in the title. Notice that it uses the word "electronic" instead of "digital." A quick review of the law shows that, in fact, the new signatures do not have any security associated with them. This means that when you sign a document, you have no assurance that what you are signing is in fact what you think you are signing. Furthermore, the person receiving the signed document has no assurance that it was in fact you who signed the document.

In other words, a contract that is "signed" with an electronic signature is worth less than one on paper. It is approximately as valuable as an oral contract, where either party can later claim to have heard or said something different than what the other party says. If you sign a document by clicking on a button in a Web form, or even by sending e-mail, the receiving party can easily claim that what you clicked on or sent is different than the copy you kept on your hard drive.

Unfortunately, the E-Sign law is probably just another FEFL (full employment for lawyers) action by Congress. They could have easily done the right thing by saying that only digitally signed agreements, using the kind of security Network World readers have been using for many years, were legally binding. Crafting such a law isn't easy, but it's not impossible, either. It is certainly too soon to say "all digital signatures must use Secure Multi-purpose Internet Mail Extensions" or "all digital signatures must use Pretty Good Privacy," but a reasonable law could simply state "all digital signatures must use industry-standard formats and best practice security policies."

The general state of glee among those passing the bill was probably due to the promises of the lobbyists supporting the bill that this will be "good for e-commerce." That's not likely, given that the result will surely be less-than-scrupulous e-commerce sites starting to claim that users "signed" contracts that the users don't remember signing. Of course, these sites will have copies of the Web pages that the user clicked "OK" on, but nothing other than logs to prove the signature. This will end up in the newspapers, and maybe even the courts, and the result will probably be that most of the less-savvy users will trust e-commerce less than they do today.