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Fla. firm caught in HP scandal

Congress calls a Melbourne private investigator to testify about his firm’s obtaining personal phone records.

By KRIS HUNDLEY
Published September 19, 2006

A private investigator from Florida’s east coast has been called to appear before a congressional subcommittee next week because of his firm’s alleged involvement in the widening scandal over tactics used during an internal investigation at Hewlett-Packard Co.

Joseph DePante, owner of Action Research Group in Melbourne, has been identified in press reports as one of several subcontractors responsible for using subterfuge to obtain individuals’ phone records as Hewlett-Packard, a huge Palo Alto, Calif., computer company, scrambled to find out who was leaking information to the media.

California and federal authorities are investigating the chain of events and parties involved.

HP has admitted that private investigators working for the company used false pretenses or pretexting to get phone records of its directors, two HP employees, nine journalists and an unspecified number of outsiders.

George Keyworth II, the director that HP blamed for the media leaks, resigned last week, following another board member, Tom Perkins, who resigned in protest four month months ago.

The investigation, which was instigated in 2005 under HP’s former chief executive, Carleton Fiorina, and renewed this year under board chairwoman Patricia Dunn, also reportedly gathered Fiorina’s phone records.

Action Research’s DePante, 59, has denied involvement in the HP investigation. Experts believe DePante’s firm is one of the largest pretexting businesses in the country, with well over $1-million in annual revenues.

On Monday, Rep. Ed Whitfield, R-Ky., chairman of the House Oversight and Investigations subcommittee, sent DePante a letter asking him to appear Sept. 28 at its hearing on HP’s investigation.

The House subcommittee also seeks testimony from Dunn, who is resigning as HP’s chairwoman but will remain on the board, HP general counsel Ann Baskins, outside attorney Larry Sonsini, as well as two other private investigators.

DePante’s firm allegedly was hired by one of HP’s outside investigators. Then Action Research is believed to have handed the job over to Brian Wagoner, an Omaha man who reportedly has spent several years working for Action Research.

Though this is the first time DePante will appear before the House subcommittee, his name and reputation as kingpin in the black market business of pretexting came to members’ attention in June.

That’s when they heard sworn testimony from James Rapp, a Parker, Colo., man who built a million-dollar business selling confidential personal information to private investigators and media outlets until he was forced to close by federal investigators in 1999.

Rapp, who stepped afoul of the law when he posed as JonBenet Ramsey’s father to get confidential information about the infamous Colorado murder case, said DePante was a longtime client who agreed to buy Rapp’s customer list of more than 1,500 private investigators.

“We agreed upon a price and unfortunately (we) never received a penny,’’ testified Rapp, who pleaded guilty to federal racketeering charges and was sentenced to three years’ probation. “As I guess goes with this business, we were deceived.”

On Tuesday, Rapp, 47, said he had no idea of whether DePante was involved in the HP investigation, but suggested it would not be surprising.

“Action Research is one of the bigger information brokerage firms and they’ve been pretty active,’’ said Rapp, who said he keeps in close touch with former employees who went to work for DePante. “Joe tries to keep his hands somewhat clean, farming stuff out. But he’s in business to do this type of work.’’

Rapp said he began selling confidential personal information to DePante in the early 1990s. “He was one of our bigger clients,’’ Rapp said of DePante, whom he described as a dead-ringer for Colonel Harland Sanders of Kentucky Fried Chicken fame. “He was as sweet a guy as you’d ever want to meet, but he was from New York and very money-grubbing. He was always trying to lowball you on the price. So he was a big client quantity-wise but not dollar-wise.’’ Rapp said he was paid $10 to $25 per record search.

DePante, who has served on the boards of both the national and state private investigators’ trade associations, is a licensed private investigator in Florida, as is his wife, Kathleen. His son Matthew, who does not have a Florida license, is manager of Action Research. According to the company’s Web site, Matthew DePante is knowledgeable in all areas of telephone research.

Though “telephone research” could mean a variety of services, privacy experts say it is often used as code for pretexting to get personal telephone records, known in the trade as “tolls.”

Action Research’s Web site also boasts the company’s information as being “100 percent current as of today.”

“No databases or month-old information here,’’ it says.

That, too, should raise a red flag, said Rob Douglas, an information security consultant in Colorado who operates PrivacyToday.com.

“That is a clear indicia of a pretext operation,’’ he said. “Any licensed PI can get lawful accounts with major information brokers that provide a myriad of public information. When a company says it has 'real-time’ information, not database information, you have to ask where else it could be coming from.’’

Douglas, who has testified before Congress several times on privacy issues and served as a consultant to the subcommittee on pretexting, said the practice is akin to identity theft. “It uses the same techniques,’’ he said.

“The end result may be different, but they’re still stealing information for money. And a relatively small but active business can gross $1-million a year.’’

While a federal law against pretexting is stalled in the Senate, Florida passed legislation specifically outlawing the practice last session. The bill, which prohibits people from using false statements to obtain phone records, went into effect in July.

In late January, before passage of Florida’s law, Attorney General Charlie Crist sued a Fort Lauderdale company, 1st Source Information Specialists Inc., for pretexting. The company, which operated locatecell.com, celltolls.com, datafind.org, and peoplesearchamerica.com, closed its operations in February.

A spokeswoman for Crist’s office said no actions have been taken against any other Florida-based information brokers, including DePante’s Action Research Group.

Rapp, who said he’s sworn off the pretexting business and is now taking care of an invalid mother in the Denver area, predicted that laws against pretexting would be ineffective.

“It will just be a little more underground,’’ said Rapp, who acknowledged that information he sold to a client led to the murder of a Los Angeles undercover police officer. “I was always aboveboard about the lying I did. But what do you think happened to my 1,500 clients when I got out of the business? Do you think this is going to stop?’’

Information from Times researcher Tim Rozgonyi and wire stories was used in this story. Kris Hundley can be reached at hundley@sptimes.com or (727) 892-2996.

[Last modified September 19, 2006, 22:36:38]