NWA-PCUG Newsletter Article, August 2004
How Does One Track The Origin of Spam?
by John Brewer
Oklahoma City PC Users Group, Oklahoma

Spammers are ingenuous people. They hide the origin of the spam and are masters of obfuscation. Recently, litigation has been filed under federal law. It is interesting to investigate how the spammers were identified. A recent article in the New York Times turns on the light regarding this method of tracking.

“The government's first criminal case under a new law outlawing some types of spam e-mails was based on low-tech investigative methods: Authorities followed the money. Investigators said Thursday they tracked defendants by purchasing a weight-loss product for $59.95 and waited to see who collected the money.”

“The cyber scam artists who exploit the Internet for commercial gain should take notice,'' said Jeffrey G. Collins, the U.S. attorney in Detroit. Federal law now makes it a felony to use falsehood and deception to hide the origin of the spam messages hawking your fraudulent wares.”

Court papers described a nearly inscrutable puzzle of corporate identities, bank accounts and electronic storefronts used to send hundreds of thousands of e-mail sales pitches for fraudulent weight-loss products. The FTC said angry consumers forwarded more than 490,000 e-mails from the operation from January until April -- more than from any other spam outfit worldwide during the same period. Beales called it a dubious distinction.''

CNet News reported that “according to court documents, the four men are accused of generating hundreds of thousands of different e-mails that hid their identities and advertised a weight loss patch. The e-mails were sent out under a variety of company names, including AIT Herbal, Avatar Nutrition and Phoenix Avatar, identified collectively as the Avatar Companies. The e-mails were allegedly sent to millions of e-mail accounts over the course of several years.”

However, the CNet article also reported that the federal law has not eliminated spam and that the volume of spam has actually increased since the implementation of the law. “Despite the existence of Can-Spam, companies that monitor the volume of junk e-mail believe that the legislation has done little to discourage the distribution of spam. E-mail service company MessageLabs reported that more than 67 percent of all e-mail sent in April 2004 was considered spam, up from 59.9 percent in February and 52.8 percent in March, when volume temporarily dipped. The Feds bringing the heat against these spammers and their clients is a great victory for everyone who's been victimized by spam," said Mark Sunner, chief technology officer for New York-based MessageLabs. "At the same time, with spam volumes increasing 30 percent since the Can-Spam law went into effect, there is a whole new contingent of spammers in operation. These contemporary spammers are now dressing up their messages so they appear to be legitimate. In spite of effective lawsuits, complaints and arrests, spammers are still finding ways to beat the system."

The Federal Trade Commission announced in an April 29 news release that “that the deceptive claims violate the FTC Act and that the spoofing and failure to provide an opt-out capability violate provisions of the recently enacted CAN-SPAM Act. At the FTC’s request, U.S. District Court Judge James F. Holderman entered a Temporary Restraining Order requiring an end to illegal spamming and deceptive product claims and freezing the defendants’ assets.

In addition, the FTC announced a second action against an Australian company, Global Web Promotions Pty Ltd., an Australian company that the FTC alleges is responsible for massive amounts of spam in the United States.” Global Web not only advertised a diet patch similar to the one in Phoenix Avatar, it also claimed its human growth hormone products “HGH” and “Natural HGH” 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 for $ 80.90 and the HGH products cost $74.95.

“In both cases, the FTC introduced as evidence thousands of examples of the defendants spoofing a wide array of victims, including AOL, Microsoft Network, and other companies and individuals. Spoofing involves forging headers on e-mail to make it appear that they came from an innocent third party. Undeliverable e-mail is returned to the innocent victim, often flooding their servers and interfering with normal operations. This process not only is prohibited by the CAN-SPAM Act, it also has worked real hardship on innocent businesses.”

“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. The Global Web Promotions Pty case was brought with the assistance of the Australian Competition and Consumer Commission and the New Zealand Commerce Commission.”

Finally, it looks like some spammers may be headed for the slammer. No one will be disappointed and maybe prosecution of slammers will give future spammers pause to think about their activity … or will they just become more clever in their pursuit of the dark side?

John Brewer practices law in Oklahoma City, is a member of the Governor’s and Legislative Task Force for E-Commerce, and enjoys issues relating to eBusiness and cyberspace.

There is no restriction against any non-profit group using this article as long as it is kept in context with proper credit given the author. The Editorial Committee of the Association of Personal Computer User Groups (APCUG), an international organization of which this group is a member, brings this article to you.

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