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FTC Suit Targets Six in Deceptive 'Spamming'

November 14, 2002|From Reuters

WASHINGTON — The Federal Trade Commission said Wednesday that it had sued six junk e-mailers who bombarded Internet users with illegal pyramid schemes, fraudulent loans and e-mail filters that actually attracted more "spam."

The announcement came as other state and federal law-enforcement authorities in the Northeast announced actions of their own as part of a concerted effort to cut down on deceptive spamming and other illegal behavior on the Internet.

"All of us are combining our resources to combat deceptive spam and Internet scams," Barbara Anthony, regional director for the FTC, said at a press conference in Boston.

The FTC coordinated similar efforts in the Midwest and Pacific Northwest earlier this year.

Although spam is widely regarded as a nuisance, it is not illegal under U.S. law.

All those facing FTC lawsuits are charged with violating existing laws against deceptive and unfair trade practices.

One defendant used the logos of such well-known financial institutions as Prudential and Fannie Mae to collect such personal information as income and home values from respondents, the FTC said.

The defendant, whose name was not released, also used false return addresses so those trying to contact him would not get "no such recipient" and "do not contact me" messages, the FTC said. As a result, 30,000 such responses were sent to an innocent Internet user, the FTC said.

Another defendant sent spam for a service that promised to eliminate spam. In fact, the product sold by NetSource One and its principal, James R. Haddaway, actually attracted more spam, the FTC said.

Four others were charged with sending illegal chain letters asking for money. The defendants agreed to stop the practice or face fines, the FTC said.

An additional 100 pyramid-scheme operators received warning letters from law-enforcement authorities.

The FTC also said that investigators had scattered special e-mail addresses around the Internet to see whether spammers would pick them up.

E-mail addresses left in news groups and on Web pages were almost certain to receive spam, investigators found, while those left on message boards and posted in e-mail directories were somewhat less likely to. And addresses left in chat rooms were certain to receive spam.

Although spam has been a nuisance for years, complaints have risen dramatically as the volume of unwanted commercial pitches has exploded. Anti-spam firm Brightmail Inc. estimates that spam now makes up 36% of all e-mail traffic, up from 8% a year ago.

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