Fergie's Tech Blog

FTC, 'Scareware' Company Make a Deal

Brendan Kearney writes on the Maryland Daily Record:

The alleged technical expert behind a massive “scareware” scheme has agreed to a $1.8 million judgment and to refrain from various deceptive online marketing activities to settle an action by the Federal Trade Commission.

ByteHosting Internet Services LLC and CEO James M. Reno, who allegedly supported a multimillion-dollar scam carried out by a company called Innovative Marketing Inc., also agreed to a host of reporting requirements over the next five years and to cooperate with the government’s case going forward.

In a complaint filed under seal Dec. 2, the FTC claimed the companies “dupe” consumers into buying computer security software by scaring them, via pop-up ads, that their machine is infected with viruses or spyware. The “ruse” also usually involves a scan of the person’s computer that invariably finds problems — such as “illegal porn” — along with a pitch to buy the software to fix the problems.

More than a million consumers bought the defendant companies’ fake fix, which cost at least $39.95, the suit states.

posted by Fergie @ 6/15/2009 06:37:00 PM