Architecture, Application Security, Strategy

Spammer syndicate stopped by FTC complaint

October 15, 2008
A U.S. District Court in Illinois, at the urging of the Federal Trade Commission (FTC), has ordered the world's largest spamming network to end its operations, the agency announced this week.

The HerbalKing spam gang has been the worst purveyor of unwanted emails over the past two years, according to Spamhaus, a volunteer group that tracks spammers.

The FTC said in a statement that it filed a complaint against the ring, and the court last week issued a temporary restraining order that froze the spammers' assets and prohibited them from sending any more unsolicited email and making false product claims.

Criminal charges are likely.

The spam group, accused of delivering solicitations to purchase fake or unsafe weight-loss drugs and male enhancement products, is run by Lance Atkinson of New Zealand and Jody Smith of Texas, according to an FTC statement. The pair is accused of overseeing an operation that stretched from China, India and Russia to Canada and the United States and delivered billions of illegal spam messages.

At one point, the group, thanks to a huge network of compromised computers, was believed to be behind one-third of the world's spam, the FTC said. The defendants also lied about providing security for credit card transactions, falsely claiming to customers that their "online pharmacy" used SSL encryption.

While spam experts applauded the court order as a positive step, they said there likely would be no change in the amount of spam being delivered. Spamhaus, in a statement, said it still is witnessing a barrage of HerbalKing spam, thanks to a massive botnet, estimated at its peak to be 35,000 nodes strong.

"Botnet spam systems are very automated and will continue to spam even if the operators do not login and control them," the organization said. "These spammers set up tens of thousands of domains and the spam systems route in new ones every day."

David Poellhuber, principal of ZeroSpam, a Canadian vendor, told SCMagazineUS.com that spam currently accounts for 96 percent of all emails.

"I think [this case] is a drop in the ocean of spam," he said. "It won't make much of a difference. We haven't seen our radar screen going down very much because of this."

John Teakell, a Dallas attorney for Smith, could not be reached for comment on Wednesday.

In 2005, the FTC won a $2.2 million spam judgment against Atkinson and a business partner.

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