In terms of this specific email, definitely the latter. There’s a similar panic email doing the runs of Yahoo’s groups and clubs, telling people Yahoo is trapping them into child porn stings, and the only solution is to buy some disk cleaning software.
In general, you should have nothing to worry about. Your surfing can be tracked in a number of ways, and cached files can be recovered even if you delete them. However, unless the “authorities” believe you’ve done something they will never check. It’s simply an enormous waste of time to see what everyone’s been up to, and no ISP will surrender customer information without a warrant (because it’s a major hassle for them).
Commercial sites can track the site you were at before theirs, and the site you left to visit. There’s nothing particularly sinister about this (it’s easy to do; I have statistical analysis software on visitors to my website, which I almost never go into in that much detail), unless you’re worries about them building an idea of your customer preferences.
Your ISP will log which IP address you have (static or dynamically assigned) at any given time, but these logs are so enormous that no ISP will retain them for long, and it is a major effort to go through them to identify a particular person (hence it’s only likely if you’re suspected of something particularly dodgy). Plus, these logs will likely not record every site you visit, just what address you were using. The sites themselves will record that IP address – but, again, these logs will be enormous and of little interest in the overwhelming majority of cases.
In terms of your hard disk, it depends on how good your current Norton software is. I’m not familiar with it at all. In general, though, it is easy to recover files. I was recently trained on two leading forensic software packages and how to use them. Both involve taking disk images of your hard disk(s) and processing them (including free space, unallocated space and slack space at the end of disk clusters) to identify current and deleted files.
In most cases, deleting a file doesn’t actually remove it. It justs sets a flag to say that the memory space used to hold that file is now available to be re-used and overwritten. The larger the hard disk, the more chance the file hasn’t actually gone anywhere.
The best way to clean a hard disk is to repeatedly (as in >10 times) defragment it, rearranging the space, or to use a specialist package like Evidence Eliminator. However, I wouldn’t worry about it. Unless you’ve been up to something very bad, nobody will be knocking on your door, so buying this kind of package is wasted cash. Put it this way: computer forensics is an expensive way to get people into prisons – the software costs around $6,000 per license and isn’t commercially available to individuals …
