Free cable seems like a bargain. After all, who wouldn't want programs such as "Sex in the City," "The Sopranos" or Showtime special events without paying for them?

But industry officials say cable companies are losing billions of dollars and municipalities millions of dollars each year to cable theft.

That loss, officials say, is affecting city budgets and causing cable bills to rise.

Modesto collects a 3 percent surcharge on its cable bills, said Donna Hansen, Modesto's deputy city manager. That comes out to about $720,000 a year, she said.

According to a National Cable and Telecommunications Association study published in 2000, the cable industry is losing an estimated $6 billion a year to cable theft.

About 12 percent of cable customers are stealing the service, the study said. That could come out to about $86,000 in Modesto, Hansen said.

"I don't think we can actually say that's how much we aren't collecting, because many of these cable thieves might have gone to a satellite service or used an antenna on their television if they had to pay," she said.

Several Modesto residents re- ported last week that they received an e-mail promoting the "Digital Cable Enhancer."

The device, one of many on the market that claims to allow undetected viewing of cable programs, advertises that it allows viewers to see pay-per-view and other cable programs for free. The enhancer's Web site carries several disclaimers stating that it is not meant to be used to steal cable service but rather to improve signal quality.

Though the Web site says the enhancer filters out unwanted frequencies that can degrade the quality of a picture, it serves another purpose, said Brian Dietz, spokesman for the National Cable and Telecommunications Association in Washington, D.C.

The enhancer, which resembles a small piece of metal with two coaxial cable connections, blocks the signals the in-home cable box sends to the cable company to record when a pay-per-view channel is viewed, he said.

"The courts have ruled that these disclaimers are invalid and these people are offering theft devices prohibited by state and federal law," said Susan Gonzales, a spokeswoman for Comcast, the cable provider in Modesto. "If we discover someone is using one of these devices or selling them, we will take civil action."

Penalties can reach $5,000 per device, she said.

Descrambler sellers pursued

The cable industry actively pursues those who sell descramblers over the Internet, said Craig Watson, vice president of communications for Charter Communications. He said Charter has one full-time employee devoted solely to that task.

"The moment (a vendor) sells (a descrambler) and it is used, the case law is pretty straight," Watson said. "If we can ever find him and track him from people who stole our service, we can then bust him."

The problem is, many of the manufacturers are tracked to other countries, making prosecution difficult, Watson said.

The Web site that sold the "enhancer" was owned by Randy Hansen of Vancouver, British Columbia, and the device is sold through his company, Chrisolas Marketing.

Neither Hansen nor Chrisolas returned telephone calls last week. The Web site advertising all of the company's products was taken down less than 24 hours after inquiries were made about the cable device.

Those with an inkling to try such a device should be aware that cable company officials say they know how to get around the enhancer.

"All of the billing information is in that box and the device just stalls the billing itself," Dietz said. The pay-per-view programs being watched are being tallied, and eventually that bill will be sent to the customer.

"We've already heard of several cases where a person using the device was suddenly hit with a cable bill in the hundreds of dollars," he said.

In December, detectives from the Sacramento Valley Hi-Tech Crimes Task Force and the Secret Service arrested two people in a case that involved the sale of 50,000 illegal cable descramblers in four years.

Federal charges for suspects

Darryl Poll, 41, of Simi Valley and Carlo Mireles, 29, of Las Vegas were charged in U.S. District Court with 13 counts of mail fraud, assisting in stealing cable services and conspiracy to launder money, federal prosecutors said. Their case is pending.

"There was another person who we interviewed out of Elk Grove, but he wasn't indicted," said Lt. Bob Lozito, operations commander of the task force.

Most of the boxes were traced to private residences or businesses in the Northern San Joaquin Valley that offer TV viewing for their customers, he said. The users of the boxes also are liable.

"They say the only people getting hurt are the multibillion-dollar cable companies," Lozito said. "But they also are defrauding the state of California and local municipalities of tax revenue, and that starts to add up."