The hacking group Cult of the Dead Cow releases its Trojan horse program, Back Orifice--a powerful hacking tool--at Def Con. Once a hacker installs the Trojan horse on a machine running Windows 95 or Windows 98, the program allows unauthorized remote access of the machine.

During heightened tensions in the Persian Gulf, hackers touch off a string of break-ins to unclassified Pentagon computers and steal software programs. Then-U.S. Deputy Defense Secretary John Hamre calls it "the most organized and systematic attack" on U.S. military systems to date.

An investigation points to two American teens. A 19-year-old Israeli hacker who calls himself The Analyzer (aka Ehud Tenebaum) is eventually identified as their ringleader and arrested. Today Tenebaum is chief technology officer of a computer consulting firm.

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