Spammers on Menu for Enforcement Initiatives

The Federal Trade Commission had stated it would prioritize the cases they sought action against under the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (CAN-SPAM) which took effect January 1, 2004. On April 29, 2004, the FTC announced that it has worked with the US. Attorney's Office in Detroit and the U.S. Postal Inspection service on a joint investigation which has resulted in the FTC procuring a U.S. District Court order barring illegal spamming by two companies and freezing the assets of the defendants in the cases. The defendants are:

Phoenix Avatar, LLC doing business as Avatar Nutrition, DJL, LLC, Daniel J. Lin, Mark M. Sadek, James Lin, and Christopher M. Chung doing business as A I T Herbal Marketing; and
Global Web Promotions Pty Ltd., Michael John Anthony Van Essen, and Lance Thomas Atkinson.

How bad were these spammers? The FTC maintains a database in which it collects spam messages forwarded to it by consumers. Since January 1, 2004, consumers have complained to the FTC about 490,000 spam messages linked to Phoenix Avatar and 399,000 from Global Web Promotions! That undoubtedly represented a small fraction of the actual messages. Spamhaus, an anti-spam organization, has identified these as being two of the largest spammers in the world.

What the Companies Did Wrong (allegedly)

Claims made in the emails were false;
Spammers attempted to obscure their identities by using Reply-to email addresses that belonged to innocent third parties;
Spammers attempted to obscure their identities by using email addresses that belonged to innocent third parties in the "From" field of their emails. This practice of disguising the "Reply-to" and "From" addresses is known as spoofing.;
Recipients were not given the ability to opt-out of receiving future email.

The "From" and "Reply To" fields are contained in the "header information" in emails and spoofing this is specifically prohibited in the Act. It is also a violation not to offer an opt-out capability. The FTC indicated that in both cases it introduced as evidence thousands of examples of the defendants spoofing a wide array of victims, including AOL, Microsoft Network, and other companies and individuals. The undeliverable e-mail with spoofed return addresses is returned to the innocent victim, often flooding their servers and interfering with normal operations. These messages can also cause the innocent victim to be listed as a spammer and have their valid messages blocked because of this affiliation. If your institution becomes victimized by a spammer's surfing ploy, use the instructions below to file a complaint.

NEW RULE: In related news, starting May 19th 2004, a new FTC rule goes into effect that provides that spam that contains sexually oriented material must include the warning ?SEXUALLY-EXPLICIT: ? in the subject line or face fines for violations of federal law. Read more.

Complaining about Spam
If you have a specific complaint about unsolicited commercial e-mail (spam), the FTC has a form on its Web site that you may use to complain about it OR . You can forward spam directly to the Commission at UCE@FTC.GOV without using the complaint form.

Related Links

Learn more about the legal restrictions on certain kinds of emails with the BOL Learning Connect CD ROM training, featuring Richard Insley and Andy Zavoina.

First published on BankersOnline.com 4/29/04