A Texas judge has rejected a request from the FBI for a warrant letting it hack into the computer of an online bank robbing suspect and install spyware.
In a 13 page ruling, US Magistrate Judge Stephen Smith concluded that the FBI's "novel request" was "extremely intrusive".
The bureau's plan had been to install data extraction software on a suspect's computer which could then search for records of online activity, IP addresses used, and evidence of these addresses communicating with the victim's bank's e-mail servers.
The request was made after crooks using a PC with an IP address resolving to a foreign country, gained access earlier this year to a Texas man's e-mail address and used it to get into his online bank account.
The victim spotted the security breach and secured his e-mail but another, near-identical, address was set up and used to try and wire money to a foreign bank account.
Because the FBI did not know where the offending computer was located, or its owner, it also asked in its warrant request to take photos using its inbuilt webcam to find clues.
The judge rejected the request in part over concerns that the searches would take place outside of its territorial jurisdiction because, by its own admission, the FBI did not know where the computer was.
The bureau had argued that any information gathered would be examined within the jurisdiction but, says the ruling: "Contrary to the current metaphor often used by Internet- based service providers, digital information is not actually stored in clouds; it resides on a computer or some other form of electronic media that has a physical location.
"Before that digital information can be accessed by the Government's computers in this district, a search of the Target Computer must be made. That search takes place, not in the airy nothing of cyberspace, but in physical space with a local habitation and a name."
In addition, the ruling says that while the FBI promised only to use the computer's webcam to take snap shots, in-between these shots it would have real-time access to the feed - effectively video surveillance, a far more intrusive tool.