David Baxter PhD
Late Founder
Authorities Shut Down Spam Ring
By BRAD STONE, New York Times
October 15, 2008
An Illinois district court on Tuesday ordered an international spam network to shut down, stopping what the Federal Trade Commission says was one of the most prolific spam gangs on the Internet.
The group, which used names like HerbalKings and Click Fusion, sent billions of unsolicited messages to Internet users over the last 18 months, touting luxury goods, counterfeit pharmaceuticals and pornography, according to the F.T.C.
But its primary products, federal investigators say, were what the company described as herbal pills that would permanently enhance the male anatomy.
The investigation provides a clear window into the business of modern spam, which by some estimates accounts for 90 percent of all e-mail sent over the Internet.
To pepper Internet users with its solicitations, the HerbalKings used a botnet, a global network of computers that it had infected with malicious software. The New Zealand security firm Marshal Software, which assisted the F.T.C. with the investigation, estimated in court documents that the group?s Mega-D botnet ? named after one of its pill products ? was comprised of 35,000 computers and was capable of sending 10 billion e-mail messages a day. In January, the botnet was the leading source of spam on the Internet, the firm estimated.
F.T.C. investigators also said they monitored the group?s finances closely and that it cleared $400,000 in Visa charges in one month alone.
The F.T.C. has brought more than a hundred cases against spammers and spyware vendors over the last decade. But officials said this was perhaps the most extensive spam operation it had ever encountered, with ties to Australia, New Zealand, India, China and the United States.
?They were sending extraordinary amounts of spam,? said Jon Leibowitz, an F.T.C. commissioner. ?We are hoping at some level that this will help make a small dent in the amount of spam coming into consumer?s in-boxes.?
The F.T.C. asked the court to freeze the gang?s finances under the CAN-SPAM Act of 2003, a federal law that provides civil penalties for spammers who falsify information in e-mail messages and fail to offer ways for consumers to refuse further messages.
But the federal government is also pursuing criminal charges against the group. F.B.I. investigators in Chicago and St. Louis have executed search warrants against people they believe to have been members of the spam gang, including Jody Smith, 29, of Mckinney, Tex.
Reached at his home, Mr. Smith said: ?I don?t even know who these people are who I have been tied to,? and referred all inquiries to his laywer in Dallas, John R. Teakell. Mr. Teakell did not immediately respond to a request for comment.
Federal officials are also working with New Zealand authorities in the case against Lance Atkinson, 26, a native of New Zealand now living in Australia.
As part of its investigation, the F.T.C. purchased the ?herbal? pills from the group and asked the Food and Drug Administration to test them. The agency found that they contained sildenafil, the active ingredient in Viagra, which can be risky for some people with heart conditions. The drug offers no long-term benefits.
As with other criminal groups online, the activities of the HerbalKings were remarkably international in scope. The group was illegally selling drugs like Propecia, Lipitor, Celebrex and Zoloft and shipping them out of India. It did not operate a licensed pharmacy in the United States. The F.T.C. also said it was basing its Web sites in China, fulfilling credit cards from the Republic of Georgia and the Mediterranean island of Cyprus and transferring funds between members using ePassporte, an electronic money network.
By BRAD STONE, New York Times
October 15, 2008
An Illinois district court on Tuesday ordered an international spam network to shut down, stopping what the Federal Trade Commission says was one of the most prolific spam gangs on the Internet.
The group, which used names like HerbalKings and Click Fusion, sent billions of unsolicited messages to Internet users over the last 18 months, touting luxury goods, counterfeit pharmaceuticals and pornography, according to the F.T.C.
But its primary products, federal investigators say, were what the company described as herbal pills that would permanently enhance the male anatomy.
The investigation provides a clear window into the business of modern spam, which by some estimates accounts for 90 percent of all e-mail sent over the Internet.
To pepper Internet users with its solicitations, the HerbalKings used a botnet, a global network of computers that it had infected with malicious software. The New Zealand security firm Marshal Software, which assisted the F.T.C. with the investigation, estimated in court documents that the group?s Mega-D botnet ? named after one of its pill products ? was comprised of 35,000 computers and was capable of sending 10 billion e-mail messages a day. In January, the botnet was the leading source of spam on the Internet, the firm estimated.
F.T.C. investigators also said they monitored the group?s finances closely and that it cleared $400,000 in Visa charges in one month alone.
The F.T.C. has brought more than a hundred cases against spammers and spyware vendors over the last decade. But officials said this was perhaps the most extensive spam operation it had ever encountered, with ties to Australia, New Zealand, India, China and the United States.
?They were sending extraordinary amounts of spam,? said Jon Leibowitz, an F.T.C. commissioner. ?We are hoping at some level that this will help make a small dent in the amount of spam coming into consumer?s in-boxes.?
The F.T.C. asked the court to freeze the gang?s finances under the CAN-SPAM Act of 2003, a federal law that provides civil penalties for spammers who falsify information in e-mail messages and fail to offer ways for consumers to refuse further messages.
But the federal government is also pursuing criminal charges against the group. F.B.I. investigators in Chicago and St. Louis have executed search warrants against people they believe to have been members of the spam gang, including Jody Smith, 29, of Mckinney, Tex.
Reached at his home, Mr. Smith said: ?I don?t even know who these people are who I have been tied to,? and referred all inquiries to his laywer in Dallas, John R. Teakell. Mr. Teakell did not immediately respond to a request for comment.
Federal officials are also working with New Zealand authorities in the case against Lance Atkinson, 26, a native of New Zealand now living in Australia.
As part of its investigation, the F.T.C. purchased the ?herbal? pills from the group and asked the Food and Drug Administration to test them. The agency found that they contained sildenafil, the active ingredient in Viagra, which can be risky for some people with heart conditions. The drug offers no long-term benefits.
As with other criminal groups online, the activities of the HerbalKings were remarkably international in scope. The group was illegally selling drugs like Propecia, Lipitor, Celebrex and Zoloft and shipping them out of India. It did not operate a licensed pharmacy in the United States. The F.T.C. also said it was basing its Web sites in China, fulfilling credit cards from the Republic of Georgia and the Mediterranean island of Cyprus and transferring funds between members using ePassporte, an electronic money network.
