US orders $163 mn fine for 'scareware'

Oct 02, 2012
A US federal court has ordered a $163 million fine against the operators of a "scareware" scheme which tricked computer users into thinking they were infected, and then sold them a "fix," officials said Tuesday.

A US federal court has ordered a $163 million fine against the operators of a "scareware" scheme which tricked computer users into thinking they were infected, and then sold them a "fix," officials said Tuesday.

The said the court imposed the fine on Kristy Ross and two companies, Innovative Marketing and ByteHosting Internet Services, and permanently barred them from selling .

The FTC said its probe dated back to 2008 when it charged Ross and six other defendants with scamming more than one million consumers into buying software to remove malware supposedly detected by computer scans.

The FTC charged that the operation used elaborate and technologically sophisticated which displayed to consumers a "system scan" that detected a host of malicious software.

Consumers who fell for the scheme would pay $40 to $60 to clean off the malware.

Under a 2011 settlement, two other defendants were ordered to give up $8.2 million in ill-gotten gains. Two others previously settled the charges and the FTC obtained default judgments against three other defendants..

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User comments : 18

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NotAsleep
3.4 / 5 (10) Oct 02, 2012
Why can't they apply the same laws to people that peddle bogus herbal remedies or other things that make auras brighter and penises bigger? Oh, right, because people have been praying on suckers since the beginning of humanity. People that fail at having common sense don't deserve to get that money back. Let them get scammed as an example to others so people stop relying so much on government social security nets and start using their heads to solve problems and navigate society themselves

Now pardon me while I mail this check to the prince of Abu Dhabi so that his government doesn't fail. He promised he'd pay me back double so it's a win-win for us all
Grallen
1.7 / 5 (6) Oct 02, 2012
I don't this the people scammed deserve their money back. But, I also believe that the con-artist doesn't deserve it either. The Government should keep the money and invest it in a publicly owned hospital that operates for profit just like the private ones. Oh and the con-artists should be sent to an asylum for extreme sociopathic behavior... and billed for the service of removing their malady.
ValeriaT
2 / 5 (2) Oct 02, 2012
I don't think(?) the people scammed deserve their money back.. the con-artist doesn't deserve it either
I do agree - the people who are accelerating the evolution with penalization of human stupidity shouldn't be judged so strictly..;-)
TheKnowItAll
3.5 / 5 (6) Oct 03, 2012
I would like to point out that morals are not just for the less knowledgeables. Also, I thank the US Federal Court and the organisations responsible for the punishing of those criminals. Great job!
kochevnik
2 / 5 (5) Oct 03, 2012
This crapware infected my site when I clicked on a link about homeless Nigerian mothers. I then installed Kaspersky and the marware was deleted in 5 minutes on my Windblows7. Only my windose computer is infected. Micro$oft is like having a little zionist and NSA agent living inside my machine, installing backdoors for their charming police state. I'm sure they are profoundly interested in the one or two people of Muslim descent I keep in my circle. Never mind they're atheists. They're only one click away from being a terrorist! Well the Israel-first mafia can hack my box at their leisure and discover the trove of games and movies we play, as well as programs I temporarily download before building superior varients on my UNIX boxes.
J_A_F_O_
5 / 5 (2) Oct 03, 2012
Kind of a shame that if they kick the IRS a little cash, the penalty gets reduced from $163 Million to just under $118,000.
Crime pays. Yet again.
J_A_F_O_
5 / 5 (5) Oct 03, 2012
Kind of a shame that if they kick the IRS a little cash, the penalty gets reduced from $163 Million to just under $118,000.
From another site - "The Maryland Daily Record reports that, last Friday, the order fully went into effect. According to it, Reno did not admit liability, but settled for the $1.8-million judgment, which will be suspended if ByteHosting pays a tax bill of $17,827 to the IRS and the funds in four bank accounts, totaling around $100,000, are forfeited to the FTC."

Crime pays. Yet again.
_ucci_oo
2 / 5 (4) Oct 03, 2012
If you fell for this......
_ucci_oo
2 / 5 (4) Oct 03, 2012
I have a nice bridge in Brooklyn....
PoppaJ
1 / 5 (1) Oct 03, 2012
I don't this the people scammed deserve their money back. But, I also believe that the con-artist doesn't deserve it either. The Government should keep the money and invest it in a publicly owned hospital that operates for profit just like the private ones. Oh and the con-artists should be sent to an asylum for extreme sociopathic behavior... and billed for the service of removing their malady.

This has to be the most stupid thing I ever heard. Lets not make the people whole,,, no no that would be the right thing to do. What the heck lets take those ill gotten gains and punish the victims even more by Ill-gaining those gains and ship them off to an interest of our own. But what ever you do, don't you dare give it to victims. Basically what you are saying is the victims should be punished twice for falling for a scam.
eHofmann
5 / 5 (2) Oct 03, 2012
... clearly ... some of the commentators, here, haven't seen one of these scams attacking their computer and how they infiltrate a system in a way that basic users can't easily distinguish it from normal operating system behavior. I repair computers for a living and have often wondered how treacherous and widespread these attacks actually are and how easy it was to be infiltrated by one. Often I had to resort to restore the system, to a date before the attack, to get the system operational again ... if you want to blame someone (besides the malicious or the inexperienced) than it should be Microsoft, for integrating a web tool (Internet Explorer) into the core of the operating system (done purely for commercial reason, to outsmart Netscape and to dominate the web) ...
NotAsleep
2 / 5 (1) Oct 03, 2012
eHofmann, sure, there are a legitimate few whose computers have actually been hacked by criminals targeting specific people. On the other hand, a majority of people that get "hacked" opened that window themselves by clicking through suspect websites and falling prey to malware on their computers. I still have some compassion for these people.

Then there's the crowd that got scammed in THIS article, people that knowledgably paid money to a company for no other reason than "the company told us to". If someone runs up to you in the street and screams, "Quick! You need this vaccine for $100 or YOU WILL DIE!" Would you pay them money without a second opinion? If you freely give your money up then you've been legally scammed. Lesson learned. Life goes on, don't do it again
MP3Car
not rated yet Oct 03, 2012
I am surprised at the number of people on here commenting that the people who were scammed don't deserve any money back...... What if it was your grandmother/parents? Would you honestly just say, "sorry grandma, your loss." ???
antonima
5 / 5 (1) Oct 03, 2012
First off, why the **** aren't these people being sent to jail or prison?????? Hello! They are cheating people out of money! They ARE criminals! This is completely stupefying to me. Just like those people who make anti muslim vidoes and don't get sent to jail. Where is the US justice system going nowadays?? Does no one actually understand what justice is??

Secondly, I have been subject to this kind of malware before. It is convincing- your computer freezes up and you cannot run anything until you pay them... and yeah, the message is like 'give us your credit card number and we will solve your problem!'. I actually had to use another computer to find out how to remove it. If someone doesn't have access to another comp it may be very difficult to combat, and paying 40$ might be cheaper than going to an IT specialist.
NotAsleep
1 / 5 (1) Oct 03, 2012
I am surprised at the number of people on here commenting that the people who were scammed don't deserve any money back...... What if it was your grandmother/parents? Would you honestly just say, "sorry grandma, your loss." ???

As it happens, something similar happened to my grandmother. Three car insurance companies sold her three policies on the same car. She doesn't drive or have a valid license. There's nothing we could do except report the company to the BBB. Our only solution was to control grandma's access to her money.

Laws to protect the elderly or incompetent won't work. Scam artists find loopholes. Additional laws will cost the taxpayer more money and put additional burden on legitimate business. I understand the compassion for victims but the people in this story were let down by themselves or their loved ones, not by the government. Giving them their money back is letting them off the "accountability" hook
Bill_Collins
4.3 / 5 (3) Oct 03, 2012
First off, why the **** aren't these people being sent to jail or prison?????? Hello! They are cheating people out of money! They ARE criminals! This is completely stupefying to me. Just like those people who make anti muslim vidoes and don't get sent to jail. Where is the US justice system going nowadays?? Does no one actually understand what justice is?


So I am totally with you that these people who prey on the non-technical are criminals. But how did someone who created a sophomoric, tasteless, but constitutionally protected video make it into the same category as con artists? Free speech, no matter how much we disagree with the content, is foundational to the freedoms we are so fortunate to have in the USA.
antonima
not rated yet Oct 03, 2012
So I am totally with you that these people who prey on the non-technical are criminals. But how did someone who created a sophomoric, tasteless, but constitutionally protected video make it into the same category as con artists? Free speech, no matter how much we disagree with the content, is foundational to the freedoms we are so fortunate to have in the USA.


So, I admit that I haven't seen the alleged 'anti-islamic' video. I just now watched a few minutes of it and I had to turn it off because it was just that boring. . . In the US, hate-inducing speech is not protected by the law. I assumed that it was more hateful than it was mocking. I really should have watched the video, before I made that comment. :\
kochevnik
3 / 5 (2) Oct 03, 2012
I assumed that it was more hateful than it was mocking.
This is the kind of story paraded around the globe while the banksters are busy reaching into your back pocket. BTW half the US personnel evacuated out of Benghazi were CIA.

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