Return of the Guru

Toothless Laws, Slimy Spammers Are Trouble for Legitimate Business

Ara Trembly
Insurance Experts' Forum, October 21, 2010

If your online experience is anything like mine, you are all too aware of the fact that cookies designed to harvest your Web surfing information are about as common as rats in a garbage dump, and probably just about as desirable.

Hardly a week goes by when my anti-spyware software doesn’t catch at least a dozen such cookies during a regular security sweep of my computers. Of course, I immediately delete or quarantine the malware, but the same annoying cookies seem to keep popping up week after week. At this point, I’ve written this off as a fact of life, but at the same time it bugs me that nefarious forces are out there spying on me and there doesn’t seem to be anything I can do about it.

Thus, when I first read in an Internet posting that Facebook has filed lawsuits against two individuals and one company for spamming its users and harvesting their personal information, I was happily surprised. Apparently, the spammers are getting the information by persuading consumers to sign up for non-existent products and services.

The lawsuits, filed in federal court, accuse Steven Richter, Jason Swan and Max Bounty Inc. of violating the Computer Fraud and Abuse Act, the CAN-SPAM Act and other state and federal laws. Facebook reportedly is seeking compensatory, statutory and punitive damages from each of the three parties.

According to the Facebook website, the named parties have been attempting to trick people on Facebook into signing up for mobile subscriptions and sending spam to their friends. “We allege that [the parties] used Facebook to offer enticing, but non-existent products and services,” the site notes. “According to our complaints, the defendants, among other things, represented that in order to qualify for certain fake or deceptive offers, people had to spam their friends, sign up for automatic mobile phone subscription services, or provide other information. We claim that by doing this, they violated the U.S. Computer Fraud and Abuse Act, the Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM), and other state and federal laws.”

I really applaud Facebook for doing this, because these kinds of slimy actions may affect us all. The spammers could just as easily be offering ridiculously discounted auto insurance in return for the goodies promised. This brings up the possibility that an insurer—even if not actually involved in the scam—could have its reputation damaged by a spammer who made such promises.

To be sure, Facebook has won some similar lawsuits, with awards in the millions of dollars. The problem with that, according to one Internet posting, is that the chances of the company actually collecting any money on such victories are virtually non-existent. If that is true, then there is literally no deterrent effect as a result of such lawsuits. It seems to me that spammers know very well that: 1. They are unlikely to be caught and prosecuted, and 2. Even if they are successfully sued, it is unlikely they will have to pay. So the spammer changes his online profile, name and persona and goes right back to work defrauding the public.

Some might dismiss this by citing the old “buyer beware” philosophy, and that is not an unfair point. The real problem, though, is that current laws and regulations are essentially toothless when it comes to exacting payback and dealing out punishment for computer-related crimes. Criminals will get away with all they can get away with—to no one’s surprise.

Until we start realizing that what goes on in cyberspace really can harm us in real life, however, we are faced with an unscrupulous enemy who laughs at our efforts to stop him. And it’s really our own fault, or at least the fault of the lawmakers we elect.

Ara C. Trembly (www.aratremblytechnology.com) is the founder of Ara Trembly, The Tech Consultant, and a longtime observer of technology in insurance and financial services.

Readers are encouraged to respond to Ara using the “Add Your Comments” box below. He can also be reached at ara@aratremblytechnology.com.

This blog was exclusively written for Insurance Networking News. It may not be reposted or reused without permission from Insurance Networking News.

The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.

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