FTC Files Complaint Against Alleged Spyware Distributor
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The FTC said it believes the companies induced computer users to buy its spyware-eradication software, sold for US$30 and bearing names such as Spy Wiper and Spy Deleter, after first infecting
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The US Federal Trade Commission filed a legal complaint last week against two companies that are believed to have infected computers with spyware and pop-up advertising and then attempted to sell their ownersâ anti-spyware software.
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Spyware has come under target of the Federal Trade Commission with a new complaint filed in federal court which is requesting that two Internet based advertising and software firms be closed.
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The U.S. Federal Trade Commission (FTC) has begun mailing claim forms to more than 1,400 identity theft victims who spent money to clear up identity-theft problems due to a security breach at data broker ChoicePoint announced in early 2005.
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Organizations and law enforcement agencies fighting spyware are making progress, but new tools in an antispyware bill stalled in the U.S. Congress could improve the efforts, a member of the U.S. Federal Trade Commission said Monday.One of the spyware bills passed by the House of Representatives earlier this year, the Spy Act, would give the FTC authority to impose civil fines on companies that distribute spyware to consumers&#39; computers. The bill, along with the Internet Spyware Prevention (or I-SPY) Act, have&#160;stalled in the Senate&#160;since passing the House in May and June.The FTC has the authority to collect profits from spyware operations and collect money for consumer redress, but it lacks the authority to impose other fines, as it does when going after spammers, said Commissioner Jon Leibowitz, speaking at a spyware forum in Washington, D.C.Assigning a dollar figure to consumer harm is tricky in many spyware cases, especially when the spyware delivers pop-up advertisements to computers, Leibowitz said. It&#39;s sometimes difficult to get courts to assign large consumer damages to pop-up cases, he said.In some cases, spyware damages are assessed by judges &quot;who don&#39;t even use computers,&quot; said Dave Koehler, with the FTC&#39;s Bureau of Consumer Protection.The Spy Act would allow the FTC to fine spyware vendors up to $3 million for hijacking computers, delivering unwanted adware, and other violations, and $1 million for collecting personal data without permission, in addition to going after the vendor&#39;s profits and seeking consumer redress.Additional authority to impose civil fines would give the FTC &quot;an enormous deterrent,&quot; Leibowitz said.&quot;Right now, companies know that the worst they can do is lose their profits,&quot; he added. &quot;They&#39;re not going to get fined on top of that.&quot;The FTC has brought several spyware actions against companies. In February, the agency settled&#160;a case against adware distributor DirectRevenue. In that case, DirectRevenue settled for $1.5 million, based on its profits, but the founders of the company had received more than $20 million in venture-capital funding, Leibowitz said.While participants in the spyware forum said there continue to be many challenges, including a growing trend of foreign spyware vendors, the cost of spyware to U.S. consumers seems to be falling. Consumer Reports estimated that spyware cost U.S. consumers $2.6 billion in 2006, but only $1.7 billion in 2007, noted Ari Schwartz, deputy director of the Center for Democracy and Technology, a supporter of StopBadware.org, a consumer-protection effort aimed at spyware and other malicious code.The drop in the cost of spyware can be attributed to a number of factors, Schwartz said. Antispyware technology is getting better, the FTC has taken action against spyware vendors, and StopBadware.org has distributed a&#160;list of malicious Web sites, he said. In addition, some states have taken action against spyware, and cybersecurity groups&#39; public education programs seem to be working, he said.But Ron Teixeira, executive director of the National Cyber Security Alliance (NCSA), noted that consumers may know more about spyware, but they aren&#39;t always acting on their knowledge. A survey released by the NCSA and McAfee earlier this month found 78 percent of respondents&#39; computers didn&#39;t have all three of what the NCSA calls the &quot;core protection&quot; software: anti-virus, antispyware, and firewall.&quot;We&#39;re not seeing a huge increase in the actual behavior change,&quot; he said.
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The U.S. Federal Trade Commission (FTC) has asked a federal court to require an alleged Web page hijacking operation to obey previous orders barring unfair and deceptive practices.
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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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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 US Federal Trade Commission has filed America&#39;s first case against software companies accused of infecting computers with intrusive spyware and then trying to sell people the solution.
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FTC charges that Petco Web site left customer data exposed.
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The U.S. government has sued a New  Hampshire man in its first attempt to crack down on Internet  "spyware" that seizes control of a user's computer without  permission.
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(InfoWorld) - The U.S. Federal Trade Commission has filed a complaint against digital music service BurnLounge Inc., accusing the company of operating an illegal pyramid scheme, the FTC announced Tuesday. The complaint, filed in U.S. District Court for the Central District of California June 6, asks the court to permanently shut down the alleged illegal pyramid practices, the FTC said in a press release. BurnLounge recruited customers through the Internet, telephone calls and in-person meetings, the FTC said. In its sales pitch, BurnLounge told customers they were likely to make substantial income if they would buy one of its product packages, ranging from US $29.95 to $429.95 per year. The more expensive packages purportedly provided participants with an increased ability to earn rewards through the BurnLounge compensation program. BurnLounge, based in New York, called its business model "unique and revolutionary," in a press release in response to the FTC court filing. "BurnLounge will continue to afford its customers the opportunity to enjoy sharing their tastes in music and films, while providing an avenue for them to express their entrepreneurial talents," Sheldon Sloan, attorney for BurnLounge, said in a statement. So far, the court has refused to grant a temporary restraining order, Sloan added in his statement. The denial is "a significant victory, and furthers the company's belief that it has conducted its business lawfully," he added. BurnLounge, which launched its service in mid-2006, calls itself the "world's first fan-driven download community." Customers open their own digital music stores and sell music and movies they recommend to friends. But the FTC alleges that the BurnLounge compensation program primarily provided payments to participants for recruiting of new participants, not on the retail sale of products. Retail sales would result in a substantial percentage of participants losing money, the FTC said. The FTC accuses BurnLounge and its owners of operating an illegal pyramid scheme, making deceptive earnings claims, and failing to disclose that most consumers who invest in pyramid schemes don't receive substantial income, but lose money, instead. The FTC has asked the court to halt the alleged deceptive practices and misrepresentations and to freeze the defendants' assets, pending a trial. At a June 8 hearing on the FTC's request for a temporary restraining order, BurnLounge's attorneys asked for more time to respond fully, and U. S. District Court Judge George Wu ordered that a full hearing on the FTC's request for a preliminary injunction and asset freeze be held on June 19.
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Scammers are sending out virus-laden e-mails claiming to have information on complaints filed with the U.S. Federal Trade Commission, the FTC warned Monday.The e-mail appears to come from frauddep@ftc.gov -- a spoofed address -- and it includes a malicious attachment that downloads keylogging software, which is used to steal sensitive information such as passwords and account numbers.&quot;While the e-mail includes the FTC seal, it has grammatical errors, misspellings, and incorrect syntax,&quot; the FTC said in an alert , released Monday. &quot;Recipients should forward the e-mail to spam@uce.gov and then delete it.&quot; E-mail sent to this uce.gov address goes into the FTC&#39;s spam database, which is used by investigators.Online scammers often masquerade as government agencies such as the Internal Revenue Service in the hopes of tricking unsuspecting victims into clicking on attachments or visiting malicious Web sites.
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With Congress considering new legislation to increase penalties against spyware companies that install programs on people&#39;s computers without their knowledge, the Federal Trade Commission last week filed a complaint against Sanford Wallace, the New
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WASHINGTON -- In what regulators are calling a first, the federal government has asked for a court order to shut down a spyware operation.
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Movieland.com is the second company to be sued under Washington's spyware law.
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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.