Using Wireless Internet in Coffee Shops etc.

Yes, easily done.

Most users have loose security on their laptops, and free wifi hotspots are usually unsecured at the access point (router not using WEP or other type of security).

My developer friend was in a Starbucks one day, checked his email, and a struck up a conversation w/ a student there. later, that student came back to hime and showed him his earthlink username & password!

In unsecured wifi hotspots, one can run a network sniffer like Ethereal along with NetStumbler and grab other user's ip addresses and all packets transmitted by other users on the LAN. (wifi hot spot users)

In fact, this is not limited to just those in the "coffee shop ", because the wifi hotspot broadcasts a signal for quite some distance. One could be sitting on a park bench accross the street and sniff out all traffic from the coffee shop.

RULE:
NEVER use a free wifi hotspot with computer applications that send clear text passwords over the wire(less). Example applications are email clients NOT using APOP, FTP clients, forms on non-ssl web pages (html instead of shtml).

 

The original name of the deceit you heard about on the news is called "Evil Twin ".
http://netstumbler.com/2005/01/21/evil_twin_fear_for_wireless_nets/

And this new technology will defeat such threats once it gets accepted and implemented:
http://netstumbler.com/2005/02/23/security_breakthrough_kills_evil_twins/