Key loggers can be software programs or hardware devices used to capture your keystrokes as you use your computer. They are used for auditing or spying purposes to monitor children’s use of the internet, to catch a cheating spouse, to detect a dishonest employee, or to capture an unsuspecting person’s credit card number or account passwords.

Computer surveillance is the act of surveilling people's computer activity without their knowledge, by accessing the computer itself.

Computers make excellent surveillance tools because they can do things without their owners' knowledge or consent. Most computers have connections to networks, which can be exploited (through security cracking) to gain access to any confidential data that may be stored on the computer. Additionally, if someone is able to install certain types of software on a system, they can turn it into a surveillance device.

Keyloggers can be tiny, free key logger programs that can be installed to capture everything you type into your keyboard including credit card numbers. See: http://home.rochester.rr.com…

There are small hardware key logger devices that can be installed between your keyboard cable and the computer port, sometimes within the keyboard case itself, that capture everything you type and are latter retrieved to get the data. Key logger devices can be implanted within a keyboard case, making them entirely invisible:http://www.amecisco.com…

There are full programs that can be installed that monitor in stealth fashion what you type, what web sites your visit, emails or instant messages sent, what images you view, what files you download or open, capture screenshots, etc. They can send logs of information back to the person who installed the program via email. See: http://monitoring-software-review.toptenreviews.com/

Keep this in mind whenever you use a public computer at your library or hotel lobby. All your accounts and password entries could be monitored, captured and retrieved without your knowledge.

Malicious Keyloggers Run Rampant on Net 

11/28/05  http://www.eweek.com/article2/0,1895,1893515,00.asp

Keylogging programs are the epitome of online stealth, and they're also a mushrooming problem on the Internet, where identity and intellectual property thefts are fueling an explosion of key-capture tools. Reports of new keylogging programs soared higher this year, as part of a wave of multifunction malware with integrated keylogging features, according to VeriSign Inc.'s security information company iDefense Inc. The programs often evade detection by anti-virus tools and can be difficult to detect once installed, experts warn. However, at least one anti-spyware company believes that reports about the danger posed by keyloggers are overstated.

More than 6,000 keylogging programs will be released by the end of this year, according to projections by iDefense. That's an increase of 2,000 percent over the last five years, company officials said. Keyloggers have been around for years and are also sold as legitimate applications—often as monitoring tools for concerned parents or suspicious spouses—according to Ken Dunham, director of malicious code at iDefense, in Reston , Va.

Earlier this year, London police foiled a $420 million keylogger scam. The British Hi-Tech Crime Unit foiled what would have been one of the biggest computer crimes in history, where thieves attempted to transfer $420 million from a London branch of Japanese bank Sumitomo Mitsui. The thieves are believed to have hacked into the bank's computer systems using information gathered from keylogger programs, which allowed them access to sensitive passwords and other account information. At present, it is not clear how the keyloggers were installed.

Anti-virus companies have developed signatures that will stop many of those programs before they can be installed, but new programs with unique signatures are readily available from malicious code download sites. In some cases, the programs' source code can be purchased so buyers can create their own keylogger variants, Dunham said.

Keyloggers are particularly common in countries where online banking fraud is a problem, such as Brazil , said Joe Stewart, a senior security researcher at Lurhq Corp., in Chicago . The keyloggers are coupled with Trojan programs, such as the Banker and PWSteal families, and are programmed to spring to life when victims type the URL of a specific bank or banks into their Web browser or when they launch a Web page with a specific name, Stewart said.

Organized gangs are taking over crime on the Web. Click here to read about some of the major players, how they work and how big a threat they really are.  Keyloggers are also pouring out of countries in Eastern Europe that are less discriminating about what kind of log-in information they capture. China is a major source of Trojan and keylogger programs, such as Myfip, that are customized to steal intellectual property, such as Microsoft Corp. Word or CAD/CAM files, rather than personal or financial information, he said.

Still, some take issue with the dire warnings about keylogging programs. Eckelberry used his blog to question iDefense's statistics on keylogging programs. He wrote that his company's researchers have identified only "a couple dozen" new keylogging programs since August, affecting only about 8,000 people.

Nice chart show how typical keyloggers work:
http://www.guardedid.com/g/pdf/SeeDiagramFinal.pdf

Woman Victimized By 'Keylogger' Spyware January 12, 2006   http://www.news4jax.com/technology/6033555/detail.html

Keylogger programs list

Computer Surveillance

http://www.securityfocus.com/infocus/1829