FTC Settles with Pop-Up Scammers

FTC (Federal Trade Commission) announced on 13 September, 2007 that it had settled with an online service, which was offering movie download, accusing the service of infecting customers' computers with pop-ups and asking subscription fee for a trial membership they had not solicited.

According to the settlement, Digital Enterprises operating the three Websites for movie download have consented to pay an amount of $500,000 to FTC to settle the dispute regarding undesirable pop-up ads. The maximum payment could be up to $2 Million if the court where the FTC filed the case against the Website operators misrepresents their monetary status.

In August 2006, FTC commented that Moviepass.tv, Movieland.com and Popcorn.net used sly methods to download software onto customers' PCs that initiated unwanted pop-up advertisements on the screen along with displeasing music, which the users could not close.

The FTC received several complaints from customers and said that the ads asked the customers to pay as much as $99 to remove the ads. The ads also said that the users had to pay as they failed to terminate free trial that was for three days. The complainants said that they neither knew anything about the download service nor had signed for any such trial.

Computer owners who tried to uninstall the software were led to a site that informed them to pay fee if they wanted to stop the pop-ups. Some victims, out of frustration, made the payment, while others paid technician to get rid of the software.

Rick Carlson, MD (Managing Director) at anti-spyware firm GRISOFT, talked highly of the enforcement action by the FTC, but warned that these kinds of offenses would continue given that the scammers found ample opportunity to make fraudulent money. SCmagazine published this news on 14 September 2007. Carlson further said the act is like a drop in the bucket. According to him, the case seems extremely impudent on the part of the offender and could be seen as extortion.

A judge of the District Court in California, in the first month of 2007, passed an order on Movieland to restrict pop-ups and to obtain users' permission before placing the ads that could seek fee from the users. The Movieland.com site is running but it does not let visitors use its features.

Related article: FTC Reaches Million-Dollar Settlement For Spyware

» SPAMfighter News - 9/29/2007