US goes after NZ spammer
The US Federal Trade Commission has filed a legal action against Global Web Promotions, a spam enterprise that operates out of Australia and New Zealand, as part of its first criminal prosecution under the new US federal anti-spam law. The action is half of a two-part action underway by the FTC. In the first, the FTC filed a complaint against Detroit-based spam operation Phoenix Avatar. That complaint was developed in a joint investigation with the US Attorney’s Office in Detroit and the US Postal Inspection Service. At the request of the FTC, a US District Court judge has barred the illegal spamming and frozen the defendants’ assets. Federal criminal authorities have executed a criminal search warrant and are in the process of arresting four principals. The action against GWP involves complaints to the FTC concerning about 399,000 messages. Both operations have been identified by the anti-spam organization Spamhaus as among the largest spammers in the world. "This case marks the Nation's first criminal prosecution under the Controlling the Assault of Non-Solicited Pornography and Marketing (CAN-SPAM) Act, which went into effect on January 1, 2004," said Jeffrey G Collins, U.S. Attorney for the Eastern District of Michigan. "The cyber scam artists who exploit the internet for commercial gain should take notice. Federal law now makes it a felony to use falsehood and deception to hide the origin of the spam messages hawking your fraudulent wares. Thanks to the great detective work of the Federal Trade Commission, the Postal Inspection Service, and the cooperation of Internet Service Providers such as Microsoft and AOL, as well as other companies and private citizens, we do have the capacity to track unlawful spammers down and bring them to justice." The FTC Case The charges against Global Web Promotions Pty Ltd, an Australian company that also does business in New Zealand, allege the company is responsible for massive amounts of spam in the United States, giving the FTC jurisdiction. In both cases, the companies advertised a "diet patch" that did not do what they claimed. In the case of Phoenix Avatar, the defendants were earning nearly $US100,000 per month from sales of the product at nearly $US60 each. The FTC says the patch "will have no effect at all" and claiming otherwise violates the FTC Act. The spammers also spoofed return addresses and used other deceptive techniques to reach potential customers. They also did not offer recipients an "opt out" option. Both of those actions violate the CAN-SPAM Act, the FTC said. GWP spam advertised not only the dubious diet patch, but also also what it called human growth hormone products "HGH" and "Natural HGH" -- which it claimed could "maintain [a user’s] appearance and current biological age for the next 10 to 20 years." Experts cited by the FTC dispute the claims, and the FTC alleged the claims are false. The products do not contain growth hormone of any sort, according to papers filed with the court. The products are shipped to consumers from within the United States. The diet patch was sold by GWP for $US80.90 and the HGH products cost $US74.95. The FTC charged Global Web Promotions Pty Ltd, Michael John Anthony Van Essen, and Lance Thomas Atkinson with violations of the FTC Act and the CAN-SPAM Act. The FTC has filed a motion requesting that the Court issue a Temporary Restraining Order barring further illegal spam and stopping illegal sales and shipment of products. According to a plaintiff's memorandum supporting the request for a TRO against GWP, commercial email must contain, at least, a clear indication of its true origin, a clear and conspicuous mechanism for consumers to opt-out from further email, and a physical postal address in the message text. While most commercial email originating in New Zealand and Australia meets the first two requirements, the requirement that a physical postal address be part of the text is rarely met. The Global Web Promotions Pty case was brought with the assistance of the Australian Competition and Consumer Commission and the New Zealand Commerce Commission, the FTC said. The Commerce Commission is conducting its own inquiry but has said that its investigation is not yet complete.
Reproduced from an article published by National Business Review
© National Business Review
The original article can be viewed here:
http://www.nbr.co.nz/home/column_article.asp?id=8925&cid=3&cname=Technology
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