December 12, 2008

US Cracks Down On Software Scams

Sellers of fake security software are now the target of the U.S. government.

The Federal Trade Commission (FTC) won a restraining order that stops several sellers of "scareware" from continuing to trade.

There are millions of people that are thought to have been caught by the software which, once installed, issues false alerts about viruses and illegal porn.

Further legal action is being pursued by the FTC to win a permanent ban on those peddling the scareware.

The FTC submitted court papers showing that the peddlers of the fake security software tricked websites into advertising their products.

Companies behind fake software won customers via adverts on many popular websites.

People clicking on an advert were taking to the webpages run by the fake security firms which then ran "scans" looking for security problems.

Each scan found security issues and urged visitors to buy their software to fix it.  Typically the scans showed evidence of viruses, spyware and illegal pornography.

"However," said the FTC, "the scans were entirely false."

The FTC targeted two firms in its legal action:  Innovative Marketing, Inc. and ByteHosting Internet Services, LLC.

The fake security software names were WinFixer, WinAntivirus, DriveCleaner, ErrorSafe, and XP Antivirus.

A U.S. District court granted an injunction, which stopped Innovative Marking and ByteHosting Internet Services from continuing to advertise their products.

The court also asked firms hosting the websites owned by these firms to block customers from accessing them.  It has also frozen assets of the companies so it can reclaim cash and refund the deceived customers.

Over a million U.S. citizens and many more around the world are thought to have been caught up by this scam.

"The popularity of the rogue anti-virus and spyware products has rocketed," said Yuval Ben-Itzhak, chief technology officer at security firm Finjan.

"People are paying 40-60 dollars for bogus software which does nothing," he said, adding that Finjan research suggests up to five million people around the world have fallen victim to the huge number of firms selling "scareware".

Chief technology officer at Websense, Dan Hubbard, said many "scareware" firms ran very sophisticated operations.  Many used search engines to ensure web users see their adverts and tune their products to each territory.

"They seem to know the law in different regions," he said. "They monetise it very well."


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