FTC Reaches Settlement With Bogus Anti-Spyware Vendors

by Glen Shapiro, LawAndTax-News.com, New York

09 January 2006

The US Federal Trade Commission announced on Thursday that two operations which promoted spyware detection products by making bogus claims have agreed to settle charges that their claims were deceptive and violated federal law.

Each operation claimed to detect spyware, even when there was not any, and then sold consumers anti-spyware software that either did not work or did not work as advertised.

The settlements require the defendants to give up a total of nearly $2 million in ill-gotten gains, and prohibit deceptive claims.

In March 2005, the FTC charged that Spyware Assassin and its affiliates used Web sites, e-mail, banner ads, and pop-ups to drive consumers to the Spyware Assassin Web site. Consumers were told the Web site “scanned” consumers’ computers at no cost to determine whether they were infected with spyware. The results of the “scans” were positive, and the site warned consumers that they had spyware installed on their systems.

The FTC charged that the defendants’ free remote scan was phony, and the defendants’ representations that they had detected spyware on the consumer’s computer were deceptive. In addition, the defendants claimed that the software they sold for $29.95 would remove all spyware programs and files. The FTC’s complaint alleged that the “anti-spyware” software did not remove all or substantially all spyware, and the defendants’ deceptive claims violate the FTC Act, which bars deceptive claims.

In June 2005, the FTC charged an unrelated operation, Trustsoft, with using similar tactics to sell its “SpyKiller” software. The FTC alleged the defendants sent pop-up and e-mail messages informing consumers that their computers had been remotely “scanned” and that spyware had been “detected,” even though defendants had not performed any such scans. The defendants urged consumers to access the SpyKiller Web site to get “free scans” for spyware.

The FTC also alleged that spam messages promoting the SpyKiller software, containing similar deceptive claims, were not identified as advertising, used false “from” lines, did not include valid postal addresses, and failed to provide consumers with notice of and the ability to “opt-out,” in violation of the CAN-SPAM Act.

U.S. District Courts ordered a halt to the deceptive practices of both operations, pending trials. The settlements announced today end those lawsuits.

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