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Fine of $163 Million for Scareware Operation Handed by Malware Distributor

The US Federal Trade Commission (FTC) has won a judgment for $163m against a marketer, Kristy Ross, responsible for defrauding users with fake security software, commonly called as scareware, as reported in v3.co.uk on September 3, 2012.

The court also confiscated all rights from the defendant, Ross including selling of antivirus software or any other sort of software that might hinder the usage of consumers' computer. It also restricted the same from any type of deceptive marketing.

In 2008, through misleading internet advertisement, FTC blamed Ross and other six defendants for deceiving more than 1 Million people from buying their software. The guilty has worked for inventive marketing and Cincinnati-based ByteHosting Internet services. Ross was an employ at innovative marketing, a Company held in Belize City, Belize, with offices in Kiev, Ukraine.

A claim held by the FTC charged that the operation employed elaborate and technologically sophisticated Internet advertisements that are placed with many renowned advertising networks and far more popular commercial websites. However, it is through these ads that run a system scam detected a host of malicious and dangerous files and programs on the PCs of consumers, as commented by the FTC.

The software ranged from $40 to $60 and promised to flush out victims machines of non-existent malware found during fake scan. "WinFixer," "WinAntivirus," "DriveCleaner," "WinAntispyware," "ErrorProtector," "ErrorSafe," "SystemDoctor," "Advancedcleaner," "Antivirus XP," AND "XP antivirus 2008", were some of the bogus products.

Frank Dorman, a spokesman at the FTC claimed that the ruling hopefully will recover victims for their losses, according to the statement published by SCMagazine.com on October 2, 2012.

Consequently, the US District Court for the District of Maryland ordered for the discontinuation of the massive scheme, pending litigation. Under a settlement announced in 2011, defendant Marc D'Souza and his father, Maurice D'Souza were asked to present $8.2 Million in ill-gotten gains. Other two defendants presented the charges against them; the FTC gained default judgment for three other defendants.

The FTC's triumph comes as Microsoft is announcing victory in its efforts to confine a number of software scams in China. The company stuck a deal with a hosting firm in china to shorten all command and control operation for Nitol, a botnet which had been extended in the country through the sale of counterfeit versions of Microsoft Windows.

Related article: FNWA Alerts Residents about Trojan-laced Scam E-mails

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