Intro to Cyber Crime and Cyber Laws in the Philippines | Credit Card | Government Information

Cyber Crime

Scope
Illustrative Cases
Prepared by:

Cyber Laws
ARVIN KIM A. ARNILLA, MA
Registered Criminologist Registered Prof. Teacher Website: www.professor-vinz.weebly.com

Cybercrime is one of the fastest growing NON-VIOLENT crimes in the Asian region. takes a great deal of technical expertise and cooperation, both local and foreign, in order to address such problems affects different countries in varying degrees, depending on the extent of the legislative enactment of each country

goes beyond the technical, transnational dimension and involves offenders who deliberately fashion their attacks to exploit the potential weaknesses present in the infrastructure’s transnational nature. threatens the substantial and growing reliance of commerce, governments, and the public upon the information infrastructure to conduct business, carry messages, and process information.

encompasses any criminal act dealing with computers and networks includes perpetration of: hate crimes, telemarketing Internet fraud, identity theft, credit card account thefts

Source: http://www.webopedia.com/TERM/C/cyber_crime.html

HATE CRIMES (bias-motivated crimes) occur when a perpetrator targets a victim because of his or her perceived membership in a certain social group, usually defined by racial group, religion, sexual orientation, disability, class, ethnicity, nationality, age, gender, gender identity, social status or political affiliation

= fraudulent selling conducted over the phone. It most often targets the poor and elderly
Common types include:
Advance fee fraud (typically claiming that the victim will receive a lottery prize, etc) Pyramid schemes; misrepresented investments or business opportunities Overpayment fraud (where the victim is overpaid with a counterfeit check or money order, and asked to wire back some of the excess)

Internet fraud refers to the use of Internet services or software with Internet access to defraud victims or to otherwise take advantage of them

Credit card fraud is a wide-ranging term for theft and fraud committed using a credit card or any similar payment mechanism as a fraudulent source of funds in a transaction. The purpose may be to obtain goods without paying, or to obtain unauthorized funds from an account.

WAYS TO PERPETRATE CREDIT CARD FRAUD
Stolen Cards Compromised Accounts Card not present transaction

Stolen cards
When a credit card is lost or stolen, it remains usable until the holder notifies the issuer that the card is lost. Most issuers have free 24-hour telephone numbers to encourage prompt reporting. Still, it is possible for a thief to make unauthorized purchases on a card until it is canceled. Without other security measures, a thief could potentially purchase thousands of dollars in merchandise or services before the cardholder or the card issuer realize that the card is in the wrong hands.

The only common security measure on all cards is a signature panel, but signatures are relatively easy to forge. Some merchants will demand to see a picture ID, such as a driver's license, to verify the identity of the purchaser, and some credit cards include the holder's picture on the card itself. However, the card holder has a right to refuse to show additional verification, and asking for such verification is usually a violation of the merchant's agreement with the credit card companies. Self-serve payment systems are common targets for stolen cards, as there is no way to verify the card holder's identity.

Compromised accounts

Card account information is stored in a number of formats. Account numbers – formally the Primary Account Number (PAN) – are often embossed or imprinted on the card, and a magnetic stripe on the back contains the data in machine readable format.

Card not present transaction (CNP)
The Internet is major routes for fraud against merchants who sell and ship products, and affects legitimate mail-order and Internet merchants. If the card is not physically present, the merchant must rely on the holder (or someone purporting to be so) presenting the information indirectly, whether by mail, telephone or over the Internet. While there are safeguards to this, it is still more risky than presenting in person, and indeed card issuers tend to charge a greater transaction rate for CNP, because of the greater risk.

Identity theft
Identity theft can be divided into two broad categories:
Application fraud happens when a criminal uses stolen or fake documents to open an account in someone else's name. Criminals may try to steal documents such as utility bills and bank statements to build up useful personal information. Or they may create counterfeit documents. Account takeover happens when a criminal tries to take over another person's account, first by gathering information about the intended victim, and then contacting their card issuer while impersonating the genuine cardholder, and asking for mail to be redirected to a new address. The criminal then reports the card lost and asks for a replacement to be sent.

Ways to Perpetrate Identity Theft Through Account Takeover

SKIMMING CARDING

SKIMMING is the theft of credit card information used in an otherwise legitimate transaction.

Thief procures a victim's credit card number using basic methods such as photocopying receipts or using a small electronic device (skimmer) to swipe and store hundreds credit card numbers while the skimmer has possession of the victim's credit card out of their immediate view. The thief may also use a small keypad to unobtrusively transcribe the 3 or 4 digit Card Security Code which is not present on the magnetic strip.

CARDING is a term used for a process to verify the validity of stolen card data.
Scenario: The thief presents the card information on a website that has real-time transaction processing. If the card is processed successfully, the thief knows that the card is still good. The specific item purchased is immaterial, and the thief does not need to purchase an actual product; a web site subscription or charitable donation would be sufficient. The purchase is usually for a small monetary amount, both to avoid using the card's credit limit, and also to avoid attracting the card issuer's attention.

Illustrative Cases

Onel de Guzman drop – out from AMA Computer College created and unleashed a remarkably dangerous computer virus called “I LOVE YOU” in August 2000 cost several companies, governments, and citizens billions of US dollars in damages

international manhunt was conducted; the investigators traced the origin of the virus to its creator, a programming student in Manila. arrested on 11 May 2000 suspect apologized to the public and said he had no intention of causing such great harm. Government prosecutors filed cases against him, but even at the first stage, the indictment

was dismissed as there was no law penalizing the act at the time (May 2000) in the Philippines

The virus was received in e-mail inboxes in Hong Kong on 4 May, 2000, with subject “I LOVE YOU” and an attachment “LOVELETTER-FOR-YOU.TXT.vbs.”. It erases or blurs the graphics and data in the computer and gets the contact addresses in the computer directory, and sends the same email to all contacts listed in that directory. Once received and opened in another computer, it replicates all that it did previously. The replication went on and on, sweeping all computers where the email was received and opened, from Hong Kong, to Europe, to the United States, infecting and damaging computers and networks of small and big companies, private and government institutions. The damage was about US$ 5.5 billion; some reports say US$ 10 billion.

The Landmark Case: JJ Maria Giner Case
Filipino hacker JJ Maria Giner pleaded guilty on Wednesday to hacking the government portal "gov.ph" and other government websites, making this the first Philippine hacking case to have ended in a conviction, the Department of Justice (DoJ) said. According to Criminal Case No. 419672-CR filed at Branch 14 of the Metropolitan Trial Court of Manila under Judge Rosalyn Mislos-Loja, a copy which was shown to INQ7.net, Giner was sentenced to one to two years of imprisonment and will pay a fine of 100,000 pesos. However, Giner immediately applied for probation, which was eventually granted by the court during Wednesday's arraignment, the DoJ said. The granting of the probation will allow Giner to skip jail time but he will still be required to report to a probationary officer on a regular basis.

Laws of Cybercrime
R.A. No. 8484 Access Devices Regulation Act of 1998 R.A. No. 9775 Anti-Child Pornography Act of 2009

R.A. No. 8792 Electronic Commerce Act of 2000

R.A. No. 9995, Anti-Photo and Video Voyeurism Act of 2009

R.A. No. 9239 Optical Media Act of 2003

R.A. No. 10088 (Anti Camcording Act of 2010)

Prohibited Acts under RA 8484

(a) producing, using, trafficking in one or more counterfeit access devices; (b) trafficking in one or more unauthorized access devices or access devices fraudulently applied for; (c) using, with intent to defraud, an unauthorized access device; more…

(d) using an access device fraudulently applied for; (e) possessing one or more counterfeit access devices or access devices fraudulently applied for;

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(f) producing, trafficking in, having control or custody of, or possessing device-making or altering equipment without being in the business or employment, which lawfully deals with the manufacture, issuance, or distribution of such equipment; (g) inducing, enticing, permitting or in any manner allowing another, for consideration or otherwise to produce, use, traffic in counterfeit access devices, unauthorized access devices or access devices fraudulently applied for;

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(h) multiple imprinting on more than one transaction record, sales slip or similar document, thereby making it appear that the device holder has entered into a transaction other than those which said device holder had lawfully contracted for, or submitting, without being an affiliated merchant, an order to collect from the issuer of the access device, such extra sales slip through an affiliated merchant who connives therewith, or, under false pretenses of being an affiliated merchant, present for collection such sales slips, and similar documents;

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(i) disclosing any information imprinted on the access device, such as, but not limited to, the account number or name or address of the device holder, without the latter's authority or permission;

(j) obtaining money or anything of value through the use of an access device, with intent to defraud or with intent to gain and fleeing thereafter;

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(k) having in one's possession, without authority from the owner of the access device or the access device company, an access device, or any material, such as slips, carbon paper, or any other medium, on which the access device is written, printed, embossed, or otherwise indicated; (l) writing or causing to be written on sales slips, approval numbers from the issuer of the access device of the fact of approval, where in fact no such approval was given, or where, if given, what is written is deliberately different from the approval actually given;

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(m) making any alteration, without the access device holder's authority, of any amount or other information written on the sales slip; (n) effecting transaction, with one or more access devices issued to another person or persons, to receive payment or any other thing of value;

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(o) without the authorization of the issuer of the access device, soliciting a person for the purpose of: 1) offering an access device; or 2) selling information regarding or an application to obtain an access device; or

(p) without the authorization of the credit card system member or its agent, causing or arranging for another person to present to the member or its agent, for payment, one or more evidence or records of transactions made by credit card.

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Conspiracy to commit access device fraud

If two (2) or more persons conspire to commit any of the offenses listed in Section 9 and one or more of such persons does any act to effect the object of the conspiracy, each of the parties to such conspiracy shall be punished as in the case of the doing of the act, the accomplishment of which is the object of such conspiracy.

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Frustrated and attempted access device fraud
Any person who performs all the acts of execution which would produce any of the unlawful acts enumerated in Section 9 of this Act, but which nevertheless does not produce it by reason of causes independent of the will of said person, shall be punished with two-thirds (2/3) of the fine and imprisonment provided for the consummated offenses listed in said section. Any person who commences the commission of any of the unlawful acts enumerated in Section 9 of this Act directly by overt acts and does not perform all the acts of execution which would produce the said acts by reason of some cause or accident other than said person's own spontaneous desistance, shall be punished with one-half (1/2) of the fine and imprisonment provided for the consummated offenses listed in the said section.

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Accessory to access device fraud
Any person who, with intent to gain for himself or for another, buy, receives, possesses, keeps, acquires, conceals, sells, or disposes of, shall buy and sell, or in any manner deal in any article, item, object or anything of value which he knows or should be known to him, to have been acquired through the use of counterfeit access device or an unauthorized access device or an access device known to him to have been fraudulently applied for, shall be considered as an accessory to an access device fraud and shall be punished with onehalf (1/2) of the fine and imprisonment provided for the applicable consummated offenses listed in Section 9 of this Act. Said person shall be prosecuted under this Act or under the Anti-Fencing Law of 1979 (Presidential Decree No. 1612) whichever imposes the longer prison term as penalty for the consummated offense.

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Accessory to access device fraud
Any person who, with intent to gain for himself or for another, buy, receives, possesses, keeps, acquires, conceals, sells, or disposes of, shall buy and sell, or in any manner deal in any article, item, object or anything of value which he knows or should be known to him, to have been acquired through the use of counterfeit access device or an unauthorized access device or an access device known to him to have been fraudulently applied for, shall be considered as an accessory to an access device fraud and shall be punished with onehalf (1/2) of the fine and imprisonment provided for the applicable consummated offenses listed in Section 9 of this Act. Said person shall be prosecuted under this Act or under the Anti-Fencing Law of 1979 (Presidential Decree No. 1612) whichever imposes the longer prison term as penalty for the consummated offense.

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A cardholder who abandons or surreptitiously leaves the place of employment, business or residence stated in his application or credit card, without informing the credit card company of the place where he could actually be found, if at the time of such abandonment or surreptitious leaving, the outstanding and unpaid balance is past due for at least ninety (90) days and is more than Ten thousand pesos, shall be prima facie presumed to have used his credit card with intent to defraud.

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Loss of access devices

In case of loss of an access device, the holder thereof must notify the issuer of the access device of the details and circumstances of such loss upon knowledge of the loss. Full compliance with such procedure would absolve the access device holder of any financial liability from fraudulent use of the access device from the time the loss or theft is reported to the issuer.

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Reporting requirements
All companies engaged in the business of issuing access devices, including banks, financing companies and other financial institutions issuing access devices, shall furnish annually, on or before the 31st of March of the succeeding year, a report to the Credit Card Association of the Philippines regarding access device frauds committed against the holders of such entities in the preceding calendar year, for consolidation and submission to the National Bureau of Investigation. Notwithstanding this requirement, banks, financing companies and other financial institutions, including their subsidiaries and affiliates, issuing access devices shall continue to be regulated and supervised by the Bangko Sentral ng Pilipinas while other companies issuing access devices shall continue to be regulated and supervised by the Securities and Exchange Commission.

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Provides for the admissibility of electronic documents in court cases: Penalizes limited online crime, such as hacking, introduction of viruses and copyright violations of at least Php100,000 and a maximum commensurate to the damage incurred, and imprisonment of six months to three years, among others; Promotes e-commerce in the country, particularly in business-to-business and business-to-consumer transactions whereby business relations are enhanced and facilitated and consumers are able to find and purchase products online; more…

Cont… Aims to reduce graft and corruption in government as it lessens personal interaction between government agents and private individuals.

RA 8792 is considered the landmark law in the history of the Philippines as a legitimate player in the global marketplace. It has placed the Philippines among the countries penalizing cybercrime. last…

Powers and Functions of the Optical Media Board

(a) Formulate and implement such policies and programs as are necessary for the accomplishment of the purposes of this Act; (b) Evaluate the qualifications of any individual, establishment or other entity to engage in the mastering, manufacture or replication of optical media. For this purpose, the OMB shall require such person to substantiate its capability to engage in said activities; more…

(c) Supervise regulate, grant, or renew licenses for specific periods, or deny, suspend, or cancel the same, subject to such conditions as it may impose, for the activities enumerated in Section 13(a), (b) and (c); (d) Conduct inspections, by itself or in coordination with other competence agencies of the government, at anytime, with or without prior notice, of establishments or entities including those within the economic zones engaged in the activities as provided in Section 13(a), (b) and (c) of this Act, and employ reasonable force in the event that the responsible person or persons of such establishment or entity evades, obstructs, or refuses such inspection. For this purpose, the agents of the OMB shall be considered agents in authority;

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(e) Apply for or obtain search warrants from any court of law, or take into preventive custody any optical media and/or material or equipment, including parts, accessories and paraphernalia used for the mastering, manufacture or replication of optical media which are found in any premises if the OMB has reasonable ground to believe or suspect that these are evidence of violation of the provisions of this Act; (f) Act as complainant in the criminal prosecution of violators of this Act;

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(g) Hear and resolve administrative cases against violators of this Act and impose administrative sanctions including, but not limited to, the imposition of fines and penalties; confiscation of optical media; and suspension, non-renewal or cancellation of the license to operate and/or closure of establishments or entities that violate the provisions of this Act. For this purpose, the Board shall have the power to issue subpoena or subpoena duces tecum to compel the attendance of witnesses and production of documents and other effects;

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(h) Call upon law enforcement agencies and the managing authorities in the economic zones for assistance in the implementation and enforcement of its decisions, orders, rules and regulations; (i) To deputize, whenever necessary, provincial governors, city and municipal mayors, and representatives of the national government agencies, organizations representing copyright owners, neighboring rights owners and concerned sectors to help monitor compliance with and report to the OMB any violation of this Act;

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(j) Require persons, establishments and entities engaged in the activities in Section 13 to keep and maintain for a period of at least five (5) years true and complete records of all activities related to the conduct of its business. For this purpose, the Board may, at any time, require the production of such records and samples of optical media from each mastering, manufacturing or replicating line; (k) Levy, assess and collect, and periodically adjust and/or revise the rates of fees and charges for the issuance of licenses granted under this Act;

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(l) Establish support offices as may be necessary;

(m) Create and maintain a database, and regularly publish data containing the list and activities of registered and/or licensed optical media and other related establishments. Any enforcement agency, including the Bureau of Customs, may refer to this database for enforcement and/or seizure;

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(n) Prescribe the internal and operational procedures for the exercise of its powers and functions, the performance of its duties and responsibilities and other related matters; and (o) Exercise such other powers and functions as may be necessary or incidental to the attainment of the purposes and objectives of this Act, and to perform other related duties and responsibilities as may be directed by the President.

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PENAL PROVISIONS
(a) IMPRISONMENT of at least three (3) years but not more than 6 years, and a FINE of not less than Five Hundred thousand pesos but not exceeding 1.5 million pesos at the discretion of the Court
1) Engage in the importation, exportation, acquisition, sale or distribution of, or possess or operate manufacturing equipment, parts and accessories without the necessary licenses from the OMB; (2) Engage in the mastering, manufacture, replication, importation or exportation of optical media without the necessary license from the OMB; (3) By himself, or through another, cause the mastering, manufacture or replication of any intellectual property in optical media intended for commercial profit or pecuniary gain without authority or consent of the owner thereof;

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(4) Engage in the Mastering, manufacture, or replication of optical media without affixing or installing in the resulting products the SID Code, and/or such other codes prescribed, assigned and authorized by the OMB. The absence of the codes prescribed, assigned and authorized by the OMB in any optical media shall be prima facie evidence that said optical media are in violation of this Act; (5) Engage in the mastering, manufacture, or replication of optical media using, affixing or installing in the resulting products false SID or other codes. The presence of false or unauthorized codes shall be prima facie evidence that said optical media are in violation of this act; (6) Engage in the mastering, manufacture, or replication of optical media using, affixing or installing in the resulting products false SID or other codes that have been assigned by the OMB to another person, or, having been assigned and authorized said codes by the OMB, allow or authorize another person, establishment or entity to use, affix or install such codes in the latter's products;

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(b) IMPRISONMENT of at least one year but not more than three years and a FINE not less than one hundred thousand pesos, but not exceeding five hundred thousand pesos (1) Engaging in the importation, exportation, sale or distribution of, or possess or acquire in commercial quantities manufacturing materials used or intended for use in the mastering, manufacture or replication of optical media without the necessary licenses from the OMB;

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(2) Knowingly performing or rendering the service of mastering, manufacture or replication of optical media, after having been licensed by the OMB, to any person, in respect of any intellectual property, who does not have the consent by the owner of the intellectual property or his representatives or assigns; (3) Refusing to submit to inspection by the OMB, or surrender for preventive custody any optical media, equipment, manufacturing materials, including parts, accessories and paraphernalia found during inspection operations to be in violation of the provisions of this Act;

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For purposes of this subsection, violators who will employ armed resistance against agents of the OMB shall be penalized under other applicable laws in addition to those provide in this Act; and

(a) Imprisonment of at least 30 days but not more than 90 days or a fine of not less than 25,000.00 pesos but not exceeding fifty thousand pesos at the discretion of the court:(1) Knowingly possess items of the same content or title, produced in violation of this Act, and used for the purpose with the intent to profit; (2) Engaging in the sale, rental, distribution, importation, exportation of, or any other commercial activity involving optical media that are in violation of this Act.

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Unlawful or Prohibited Acts. - It shall be unlawful for any person: (a) To hire, employ, use, persuade, induce or coerce a child to perform in the creation or production of any form of child pornography; (b) To produce, direct, manufacture or create any form of child pornography; (c) To publish offer, transmit, sell, distribute, broadcast, advertise, promote, export or import any form of child pornography; (d) To possess any form of child pornography with the intent to sell, distribute, publish, or broadcast: Provided. That possession of 3 or more articles of child pornography of the same form shall be prima facie evidence of the intent to sell, distribute, publish or broadcast;

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(e) To knowingly, willfully and intentionally provide a venue for the commission of prohibited acts as, but not limited to, dens, private rooms, cubicles, cinemas, houses or in establishments purporting to be a legitimate business; (f) For film distributors, theaters and telecommunication companies, by themselves or in cooperation with other entities, to distribute any form of child pornography; (g) For a parent, legal guardian or person having custody or control of a child to knowingly permit the child to engage, participate or assist in any form of child pornography;

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(h) To engage in the luring or grooming of a child; (i) To engage in pandering of any form of child pornography; (j) To willfully access any form of child pornography; (k) To conspire to commit any of the prohibited acts stated in this section. Conspiracy to commit any form of child pornography shall be committed when two (2) or more persons come to an agreement concerning the commission of any of the said prohibited acts and decide to commit it; and (l) To possess any form of child pornography.

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Prohibited Acts:
(a) To take photo or video coverage of a person or group of persons performing sexual act or any similar activity or to capture an image of the private area of a person/s such as the naked or undergarment clad genitals, public area, buttocks or female breast without the consent of the person/s involved and under circumstances in which the person/s has/have a reasonable expectation of privacy; (b) To copy or reproduce, or to cause to be copied or reproduced, such photo or video or recording of sexual act or any similar activity with or without consideration; more…

(c) To sell or distribute, or cause to be sold or distributed, such photo or video or recording of sexual act, whether it be the original copy or reproduction thereof; or

(d) To publish or broadcast, or cause to be published or broadcast, whether in print or broadcast media, or show or exhibit the photo or video coverage or recordings of such sexual act or any similar activity through VCD/DVD, internet, cellular phones and other similar means or device.

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The prohibition under paragraphs (b), (c) and (d) shall apply notwithstanding that consent to record or take photo or video coverage of the same was given by such person/s. Any person who violates this provision shall be liable for photo or video voyeurism as defined herein.

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Penalties under R.A. 9995
IMPRISONMENT of not less than 3 years but not more than 7 years FINE of not less than One hundred thousand pesos but not more than Five hundred thousand pesos, or both, at the discretion of the court If the violator is a juridical person, its license or franchise shall be automatically be deemed revoked and the persons liable shall be the officers thereof including the editor and reporter in the case of print media, and the station manager, editor and broadcaster in the case of a broadcast media. If the offender is a public officer or employee, or a professional, he/she shall be administratively liable.
If the offender is an alien, he/she shall be subject to deportation proceedings after serving his/her sentence and payment of fines.

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Exemption. - Nothing contained in this Act, however, shall render it unlawful or punishable for any peace officer, who is authorized by a written order of the court, to use the record or any copy thereof as evidence in any civil, criminal investigation or trial of the crime of photo or video voyeurism: Provided, That such written order shall only be issued or granted upon written application and the examination under oath or affirmation of the applicant and the witnesses he/she may produce, and upon showing that there are reasonable grounds to believe that photo or video voyeurism has been committed or is about to be committed, and that the evidence to be obtained is essential to the conviction of any person for, or to the solution or prevention of such, crime.

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Inadmissibility of Evidence

Any record, photo or video, or copy thereof, obtained or secured by any person in violation of the preceding sections shall not be admissible in evidence in any judicial, quasijudicial, legislative or administrative hearing or investigation.
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