FTC settles with advertiser for spam campaign
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An online advertiser that drove traffic to its Web sites by sending out spam with misleading subject lines has agreed to settle a U.S. Federal Trade Commission (FTC)&#160;complaint charging that it failed to tell consumers they had to spend money to receive so-called free products, the FTC announced Wednesday.The settlement requires Member Source Media to disclose the costs and obligations associated with the advertised products and services, and bars the company from sending e-mail that violates the CAN-SPAM Act, which regulates the sending of unsolicited e-mail. The company must also pay $200,000 in civil penalties, according to the settlement approved Wednesday in the U.S. District Court for the Northern District of California.Member Source Media -- doing business as ConsumerGain.com, PremiumPerks.com, FreeRetailRewards.com, and GreatAmericanGiveaways.com -- and the company&#8217;s owner, Chris Sommer, used deceptive spam and online advertising to lure customers to its Web sites, the FTC alleged.The company used e-mail subject lines such as, &quot;Congratulations. You&#39;ve won an iPod Video Player,&quot; &quot;Here are 2 free iPod Nanos for You: confirm now,&quot; and &quot;Second Attempt: Target Gift Card Inside,&quot; the FTC said in a press release. The company&#39;s Web-based ads contained similar offers: &quot;CONGRATULATIONS! You Have Been Chosen To Receive a FREE GATEWAY LAPTOP.&quot;When consumers arrived at Member Source Media&#39;s Web pages, they were led through a series of ads for goods and services from third parties.To qualify for their &quot;free products,&quot; consumers would have to first wade through pages of &quot;optional&quot; offers. Once they navigated those pages, they had to participate in a series of third-party promotions requiring them to do things such as purchase products, subscribe to satellite television service, or apply for multiple credit cards, the FTC said.Member Source Media&#39;s failure to disclose material facts was deceptive and violated the FTC Act, the FTC said. In addition, the agency charged that deceptive subject lines in Member Source Media&#39;s spam e-mails violated the federal CAN-SPAM Act.The settlement requires that Member Source Media clearly disclose in its ads and on its Web pages that consumers have to spend money or incur other obligations to qualify for a free product or service. The settlement also requires the company to provide a list of the obligations a consumer is likely to incur to qualify for their chosen item -- such as applying for credit cards or purchasing products.
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Porn marketer agrees to pays $465,000 in penalties, says FTC.
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New study finds spammers now focus on health-related products and general product pitches.
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By JENNIFER C. KERR    WASHINGTON  -- What would it take to get someone to turn in one of those spammers who send millions of unwanted e-mails? At least $100,000, the Federal Trade Commission figures...
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A bogus e-mail message supposedly sent by the U.S. Federal Trade Commission contains spyware and targets corporate and banking executives as well as consumers, the FTC said Monday.
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The U.S. Federal Trade Commission (FTC)&#160;has settled a complaint with a Web-based company it accused of selling people&#39;s telephone records without permission, the agency said Monday.The settlement with CEO Group, doing business as Check Em Out, bars the company and its operator Scott Joseph from marketing or selling phone records, and it requires the company to give up $25,000 of its profits from selling phone records. Selling phone records to third parties is illegal under federal law, the FTC had charged.The FTC in May 2006 filed complaints in U.S. court against five Web-based companies that obtained and sold confidential phone records to third parties. In addition to the settlement with CEO Group, the FTC has settled two other cases and obtained a default judgment against a fourth company. The complaint against the fifth company is still active.The FTC&#39;s complaints came after complaints from privacy groups and members of the U.S. Congress about pretexting, when someone obtains a telephone customers&#39; records without permission under false pretexts. In many cases, companies offering phone records over the Internet were calling telephone carriers and pretending to be the targeted customer. In September 2006,&#160;Hewlett-Packard revealed it had been spying on some of its board members and journalists in an attempt to uncover the source of boardroom leaks, and HP officials later said their investigators had used pretexting to obtain phone records.The Telecommunications Act of 1996 prohibits customers&#39; phone records from being disclosed unless &quot;upon affirmative written request by the customer.&quot; The FTC charged the five Web-based companies of engaging in unfair business practices.The settlement with CEO Group prohibits it from obtaining, marketing or selling consumer phone records or other consumer personal information except where allowed by law, the FTC said in a news release. The settlement, approved by the U.S. District Court for the Southern District of Florida, includes a judgment of $222,381, the amount the company earned by selling phone records, but the defendants said they were able to pay only $25,000. If the court finds that the defendants misrepresented their finances, the entire amount will be due, the FTC said.
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The U.S. Federal Trade Commission (FTC) has shut down four illegal e-mail spamming operations, including one that offered the opportunity to "date lonely wives," the agency said Thursday.
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(InfoWorld) - The U.S. Federal Trade Commission (FTC) has shut down four illegal e-mail spamming operations, including one that offered the opportunity to "date lonely wives," the agency said Thursday. Two of the other operations sending unwanted commercial e-mail hijacked the computers of third parties and used them to spam customers with sexually explicit e-mail, the FTC said Thursday. The FTC charged the four operations with violating the U.S. CAN-SPAM Act. Federal courts in Illinois and Arizona approved the FTC request to shut down the operations. Cleverlink Trading Ltd. and its partners will give up US$400,000 in spam-related gains to settle FTC charges that e-mail from them or their affiliates violated federal law. The FTC sued the group, saying their "date lonely wives" spam violated nearly every provision of the CAN-SPAM Act. Cleverlink's e-mail contained misleading headers and deceptive subject lines, it did not contain a link to allow consumers to opt out of receiving future spam, did not contain a valid physical postal address and did not contain the disclosure that it was sexually explicit, the FTC said. It also included sexual materials in the initially viewable area of the e-mail, in violation of the FTCâs adult labeling rule. The U.S. District Court for the Northern District of Illinois, Eastern Division halted the operation and froze the defendants' assets. The court approved a settlement with Cleverlink and four other defendants in July. In a second case, the FTC charged that Zachary Kinion sent spam hawking adult sites, mortgage rates and privacy software and paid other spammers commissions to send spam messages for him. Kinion hid his true originating address by routing his spam through the computers of innocent third parties, the FTC said. The FTC charged him with violations of the CAN-SPAM Act, and the Illinois court ordered him to halt his e-mail operations. A settlement, which the FTC agreed to in June, includes a judgment of $151,000, suspended because of Kinion's inability to pay, the FTC said. Another spam operation used "spam zombies" -- computers used without their ownersâ knowledge -- to conceal the source of sexually explicit spam. Defendants William Dugger, Angelina Johnson and John Vitale also violated the adult labeling rule, the FTC said. The settlement, approved in July by the U.S. District Court for the District of Arizona, requires the three defendants to give up $8,000 in spam-related profits, and it requires them to obtain permission from other people's computers before using them to send e-mail. The fourth spam operation used spam to drive traffic to Web sites by third parties, the FTC said. Brian McMullen, doing business as BM Entertainment and B Pimp, routed his promotions for pharmaceuticals and adult content through unwitting consumersâ computers, the FTC said. A settlement approved by the Illinois court in July imposes a judgment of $24,193, suspended based on McMullen's inability to pay, the FTC said. In addition, he has pleaded guilty to criminal charges related to spam and unauthorized possession of credit cards. He currently is awaiting sentencing.
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Company wins $84,177 over term violation; U.K. individuals, though, are virtually helpless against spammers, lawyer says.
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Alyon Technologies, a New Jersey-based Internet company, has agreed to forgive $17 million in consumer bills as part of a settlement with the Federal Trade Commission (FTC), the commission announced yesterday.
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Malicious-toolbar distributor pays more than $2 million in federal settlement.
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A U.S. district judge has ordered a company to stop sending unsolicited e-mail marketing weight-loss and anti-aging products that allegedly did not work, the U.S. Federal Trade Commission (FTC) announced Thursday.
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(InfoWorld) - The sellers of the Spyware Slayer antispyware program have agreed to pay US$300,000 in fines to settle charges that they violated Washington State spyware and consumer protection laws. Both the charges and the settlement were filed Wednesday in King County Superior Court in Seattle, said Washington State Assistant Attorney General Katherine Tassi. Two companies, both controlled by the same owners, were named in the settlement, she said: High Falls Media LLC, of Hilton, New York, and Roc Telecommunications LLC, of Rochester, New York. Company associates Thomas Tortora, Mark Libutti and Brian Einhaus, all of New York, were also named as defendants. They could not be reached immediately for comment, and the freepcscan.com Web site used to market Spyware Slayer was no longer active on Wednesday. High Falls promoted Spyware Slayer with false pop-up ads warning victims that their computer was infected with spyware, Tassi said. If the victim tried to leave the site, another pop-up cautioned, "if you leave now, damage could be done by harmful worms, viruses, adware, spyware, malware or hacker code." These ads "were essentially startling consumers into believing that they had spyware on their computer," Tassi said. "They had a pop-up that said 'we have detected a 99 percent chance that you have spyware on your computer,' and this was just an advertisement. They had not done anything to detect anything." This type of inducement is illegal under Washington's Computer Spyware Act, but has become an "all too common mode of marketing security software," Tassi said. "We do see this as an increasing trend: the exploiting of consumer fears over spyware and adware as a way of marketing software products." Las week, Washington's attorney general announced a similar settlement with a New York man who used pop-up ads designed to look like Internet Explorer alerts. He was marketing a program called QuikShield Security, she said. Roc Telecommunications ran a number of music download sites, including 24/7 Downloads, Free Download Club, and MP3s Unlimited, which also engaged in deceptive marketing practices, Tassi said. The defendants have not admitted any wrongdoing under the agreement and will have the bulk of their $300,000 fine suspended, provided that they comply with the terms of the agreement and no longer misrepresent what they are selling. "They pay $25,000 of that and then the remaining portion hangs over their head as an incentive to comply with the injunctive provisions," Tassi said. The defendants must also pay $30,000 in legal fees and provide refunds to Washington state residents who purchased their products.
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A lawsuit filed yesterday by the state of Texas charges two men with running spam operations that used misleading subject lines in e-mail messages and made misrepresentations in the body of the e-mails.
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(InfoWorld) - Consumers harmed by a pyramid-scheme scam at SkyBiz.com have until the end of March to file claims through a settlement with the U.S. Federal Trade Commission, the agency announced. In a settlement reached with the FTC in January 2003, SkyBiz.com provided $20 million to repay affected consumers. Under the redress program, consumers from the U.S. and elsewhere can receive repayments equal to the cost of their $125 SkyBiz purchase, minus any commissions they received. Consumers who want to file a claim must do so by March 30, the FTC said in a press release. Victims will be able to file claims on a Web site, at Skybiz-redress.com, available in several languages. Final payments will be made by May 21, likely in the form of a debit-type card that can be used in the U.S. and other countries, the FTC said. In May 2001, the FTC filed suit in U.S. district court in Tulsa, Oklahoma, against SkyBiz, alleging it had promoted a pyramid scheme with claims of quick riches. The complaint alleged the defendants used sales presentations, seminars, teleconferences and its Web site to tout the opportunity to earn thousands of dollars a week by recruiting new associates into the program. The $125 cost to join the SkyBiz program was supposedly to pay for an "e-Commerce Web Pak." Touting "huge amounts of money" participants could earn, SkyBiz encouraged participants to buy more than one Web Pak at a time. The plan was a classic pyramid scheme, promoted by fraudulent earnings claims, the FTC alleged. The case was scheduled to go to trial in January 2003. By then, the FTC also had pursued the case in the courts of Ireland and Bermuda, and received assistance from law enforcers in numerous countries including Australia, South Africa, New Zealand, and Canada. Before the trial, SkyBiz.com agreed to the settlement.
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(InfoWorld) - A bogus e-mail message supposedly sent by the U.S. Federal Trade Commission contains spyware and targets corporate and banking executives as well as consumers, the FTC said Monday. The bogus e-mail poses as an acknowledgment of an FTC complaint filed by the recipient and includes an attachment. E-mail recipients who open the attachment to this e-mail can download malicious spyware onto their computers, the FTC said. Recipients shouldn't open the e-mail; instead they should delete the message, the FTC advised. The hoax e-mail is personalized, containing the name of the recipient and their business. The bogus message explains how the complaint will be used and says, "Attached you will find a copy of your complaint. Please print a hard copy of the complaint for your records in the upcoming investigation." Consumers can learn more about protecting themselves from malicious spyware and bogus e-mail messages at OnGuardOnline.gov, a Web site created by the FTC in partnership with other federal agencies and the technology industry to help consumers stay safe online. The site includes information on spyware and phishing.
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The Federal Trade Commission yesterday gave limited endorsement to offering cash rewards to people who help track down e-mail spammers, suggesting that such bounties might work but in fewer circumstances than had been pushed by some anti-spam activists.