Internet's Most Hated Man Foiled Again! (Sort of...)

Sanford Wallace, the man who built a business empire with spam, has been ordered tp stop his crimes yet again by the U.S. Federal Trade Commission (FTC) . Astonishingly enough, however, Wallace is not going to prison, even though the FTC has ruled that in 2005 he broke into countless computers by exploiting a flaw in Internet Explorer. According to a Nov. 21, 2006 news release from the FTC:

In April, 2005, the FTC charged that John Robert Martinson, the principal of Mailwiper, Inc. and its successor, Spy Deleter, Inc., unfairly compelled the purchase of two purported “anti-spyware” products marketed under the names Spy Wiper and Spy Deleter. According to the FTC, Martinson and his companies paid spyware distributor Sanford Wallace and his companies, Seismic Entertainment, Inc. and SmartBot.Net, Inc., to promote, advertise, and sell the Spy Wiper and Spy Deleter programs. Wallace and his companies exploited security vulnerabilities in Microsoft’s Internet Explorer Web browser and downloaded spyware onto consumers’ computers. It then sent advertisements for the Mailwiper and Spy Deleter programs. One advertisement, for example, caused the CD-ROM tray on computers to open and then displayed a “FINAL WARNING!!” to computer screens with a message that said, “If your cd-rom drive’s open . . .You DESPERATELY NEED to rid your system of spyware pop-ups IMMEDIATELY! Spyware programmers can control your computer hardware if you failed to protect your computer right at this moment! Download Spy Wiper NOW!” The complaint charged that the defendants forced consumers either to spend $30 to purchase the Spy Wiper and Spy Deleter software, or spend substantial time and money to fix the computer problems they caused.

Wallace gets into trouble with the law over and over again yet all he ever gets is fines and orders to pretty please quit breaking into hundreds of thousands of computers. For example, see this May 2006 news story about this same case:

FTC Orders Former Spam King To Pay $4 Million For Spyware Scam

By Gregg Keizer, TechWeb Technology News

Former self-styled "Spam King" Sanford Wallace was ordered by the Federal Trade Commission (FTC) Thursday to pay back more than $4 million that he illegally made by hoodwinking users into buying anti-spyware software to fix imaginary problems.

Wallace, who in 1998 swore off spam, was ordered by a federal court to give back $4,089,500 made by convincing consumers to pay $30 per copy for Spy Wiper and Spy Deleter, two purported anti-spyware programs.

Users were duped into thinking they needed the software because Wallace exploited an Internet Explorer vulnerability to install real spyware to their PCs, including a small program that opened the CD-ROM tray and displayed the message "If your cd-rom drive’s open . . .You DESPERATELY NEED to rid your system of spyware pop-ups IMMEDIATELY! Spyware programmers can control your computer hardware if you failed to protect your computer right at this moment! Download Spy Wiper NOW!”

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