FTC aims to tighten spam law

Utah business saw revenue drop when Web site hit by scam

Published: Wednesday, Aug. 23, 2006 9:44 p.m. MDT
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Somewhere offshore, spammers could be targeting your computer, just as they targeted Cindy Carman's.

Three years ago, spammers from Australia and New Zealand hijacked the Internet domain name for her genealogy business — Kindred Konnections Inc. — and used it to disguise the source of their illegal spam messages.

"Some of the titles were, 'Increase your bedroom stamina,' and 'Sexual marvels only come once in a lifetime,"' said Carman, of Provo. "Nothing about genealogy."

Carman watched her revenue plummet as angry message recipients, who thought her business was behind the scam, fired back with nasty notes.

"They cussed us out," she said. "We were constantly having to defend ourselves."

Those spammers got caught. But for every victory, "there's 50 other cases where this doesn't happen," said Maneesha Mithal, the Federal Trade Commission's assistant director for international consumer protection.

The FTC works to shut down illegal spammers through civil actions. But a loophole in federal law prevents its investigators from sharing confidential information with their counterparts in other countries.

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That makes it tough for the agency to punish spammers and spyware distributors who have increasingly gone global, setting up homes, bank accounts and servers in separate countries.

"We have got to be able to work with our sister agencies in other countries," said FTC Commissioner Jon Leibowitz at a recent conference in Washington. "We can't give them information. We're not allowed to."

In addition, he said, consumer protection agencies in other countries are reluctant to provide confidential investigative information to the FTC because it would be available to the public through the Freedom of Information Act.

The Senate passed a bill in March that would solve both problems, but it's been stuck in a House subcommittee since April. The bill would allow information-sharing among the FTC and agencies abroad and would protect the foreign information from public disclosure.

The Justice Department already has the authority to work with foreign governments in pursuing spammers. It also has a network of 240 prosecutors who specialize in computer hacking and intellectual property crimes, said Christopher Painter, the department's deputy chief for computer crimes.

But some observers question the agency's commitment to nabbing spammers and spyware distributors.

"They've been spending their time on terrorism cases, child porn cases," said Ari Schwartz, associate director of the Center for Democracy and Technology. "They have not been as focused on spammers and spyware. This is the main priority for the FTC, to bring civil cases."

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