Us Govt Crackdown On Internet Modem Scam
The federal government Wednesday announced a crackdown on an Internet scam offering free sofware, which surreptitiously took over home computer modems and ran up costly international long-distance charges.
The Federal Trade Commission won a court order ending the scam, which worked like this: Consumers surfing the World Wide Web came across advertisements at sites like www.beavisbutthead.com for all nude all free pictures. The catch? They had to download a special Windows 95 software viewer.
Once the software was in the home computer. it secretly took control of the modem, muted its loudspeakers, then cut off the local Internet service provider and secretly dialed a number in the former Soviet republic of Moldova.
Consumers continued to surf the Web, not knowing they had been switched to a foreign Internet service provider at toll charges of $2 to $3 a minute. They remained logged on with the meter running until they turned off their computer, the FTC said. Profits were shared by the Moldovan phone company with the scam artists.
The (telephone) bills were often the first notice that you, the consumer, got that youd been defrauded, Jodie Bernstein, consumer protection director at the FTC, told a news conference.
Making matters worse, AT&T Corp stopped short of saying it would let customers entirely off the hook for bills that sometimes ran into the thousands of dollars. Although it offered accommodations, the company cited international treaties and contracts that may force it to pay the money.
Some parents got a shock when the bills arrived, FTC complaints showed.
I paid the bill and thought I should notify you of this problem, one outraged customer wrote. I have three sons who are computer-literate. Before I burn anyone at the stake, Ill convene an inquisition and attempt (vainly Im afraid) to put an end to this on our side of the world.
But consumers, whom the FTC says were defrauded of hundreds of thousands or perhaps more than $1 million, may get some money back.
The FTC won a US district court order in New York state seizing assets of the defendants: Audiotex Connect Inc., Promo Line Inc., Electronics Form Management and the people associated with them, Anna Grella, William Gannon and David Zeng.