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| | |-+  FTC sues alleged spyware distributors
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Author Topic: FTC sues alleged spyware distributors  (Read 13238 times)
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« on: October 11, 2004, 07:00:14 PM »

Contributed by Eric Wu
Monday, 11 October 2004

The U.S. 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 owners’ anti-spyware software.

The complaint asked for an injunction against Sanford Wallace, Owner and President of Seismic Entertainment Products and SmartBot.net. The FTC complaint accuses both businesses of marketing anti-spyware software to Internet users using pop-up advertisements on web sites controlled by Seismic Entertainment.

The defendants are accused of inducing computer users to spend $30 for anti-spyware software by exploiting the popular Microsoft Internet Explorer web browser to download spyware programs which causes streams of pop-up advertisements.

The unauthorized downloads are known to have changed the browser’s home page and default search sites to affiliated sites. The downloaded spyware can, in some cases, cause computers to crash and lose data, which started as early as November 2003.

A message from Wallace posted on his default-homepage-network.com web site dated October 10, 2004 denies allegation by the FTC’s complaint. An earlier message read, "We believe the U.S. government is attempting to enforce federal laws that have yet to be enacted," the web site continues, "We feel this is a political move and it is being made at the expense of legal business operations. I am not surprised at all that my companies and I, Sanford Wallace, were picked as the ‘poster boy’. I find the timing and target of this action to be extremely convenient and painfully obvious. We deny any wrongdoings and plan to pursue all legal protections, remedies and freedoms."

Just last week, the U.S. House of Representatives passed the SPY ACT (Securely Protect Yourself Against Cyber Trespass). The act outlaws means of unauthorized downloading of programs onto users’ computers. Unfortunately, the spyware legislation is not yet a law.

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