October 11, 2006
The Virginia Court of Appeals affirmed Virginia’s Anti-Spam Act and rejected the appeal of convicted Register of Known Spam Operations (ROKSO) spammer Jeremy Jaynes (a/k/a Gaven Stubberfield). A jury in the Loudoun County Circuit Court convicted Jaynes on three counts of violating Virginia’s Anti-Spam Act in November 2004. This was the first ever US felony conviction in a spamming case, and the case received attention around the world. After convicting the defendant, the same jury sentenced him to serve nine years in prison. The defendant had been seeking to overturn that conviction on appeal. Judge James W. Haley Jr. released an opinion on behalf of a three-judge panel that struck down all of Jaynes’ appeal arguments.
The facts of the case were undisputed in the appeal, according to court documents. Rather, Jaynes’ attorneys appealed on the grounds that the law used to convict Jaynes was unconstitutionally vague, unconstitutional under the First Amendment and violated the Constitution’s Dormant Commerce Clause. Based on the Appeals court’s decision, Virginia procecutors will immediately ask the trial judge to lift the suspension of Jaynes? prison sentence and order him to begin serving his 9 year sentence.
Speaking about the ruling, Virginia’s Attorney General McDonnell remarked, “spam costs Virginia citizens and businesses thousands of dollars every year in lost time and resources. Online fraud is a costly and serious crime. Today’s ruling reinforces Virginia’s Anti-Spam Act, and further protects the people of the Commonwealth from identity thieves and cyber criminals.” McDonnell continued, “I applaud our Computer Crime Unit for their work in prosecuting this case, and my predecessor Jerry Kilgore for his leadership in getting this legislation passed and the initial conviction secured. The Office of the Attorney General of Virginia will continue to lead the nation in prosecuting online criminals, and keeping the Internet safe and secure.”
Jeremy D. Jaynes was regarded as the eighth-worst Spammer in the world on our Spamhaus Project’s ROKSO list at the time of his arrest. At that time, prosecutors from the Attorney General’s Computer Crime Unit argued to the jury that Jaynes peddled his products to unsuspecting victims from around the world. His global fraud resulted in millions of dollars for him as well as a mansion and a number of homes in Raleigh, North Carolina.
Jaynes was convicted thanks to Virginia’s groundbreaking Anti-Spam Act. The Act prohibits the sending of unsolicited bulk e-mail by fraudulent means, such as changing the header or routing information to prevent recipients from contacting or knowing the identity of the sender. Such activity is punishable as a class-1 misdemeanor or as a class-6 felony. A class-6 felony is punishable by a one to five-year prison sentence and a fine of up to $2500 (£1300), or both.
Virginia’s anti-spam legislation also includes asset forfeiture provisions to allow law enforcement authorities to seize any assets or proceeds obtained through the illegal spam operation. It also enhances penalties for violation of Virginia obscenity laws through the sending of illegal spam e-mails. The legislation authorizes the Attorney General’s Computer Crime Unit to investigate and prosecute spammers if illegal e-mails are sent to, from, or through any computer or computer network located in any Virginia locality. Spammers should take note, a lot of the internet is routed through Virginia!
Another ROKSO listed spammer and the first person charged under the USA’s federal “CAN-SPAM” law, the law that made certain kinds of spamming a federal crime, was sentenced Sep 5, 2006, in the United States District Court in Ann Arbor, Michigan. United States Attorney Stephen J. Murphy made the announcement and was joined by Gregory Campbell, United States Postal Inspector in Charge, for the U.S. Postal Inspection Service. Daniel J. Lin, 30, of West Bloomfield, Michigan, was sentenced to 3 years in federal prison, followed by two years supervised release and ordered to pay a $10,000 (£5300) fine by United States District Court before Judge John Corbett O?Meara. Lin, a protégé of ROKSO spam kingpin Alan Ralsky, pleaded guilty on January 17, 2006.
The information presented to the court at the time of the plea showed that between January 2004 and August 2004, Daniel Lin and members of his gang developed a business to market and sell certain products, including weight loss patches, so called “generic” viagra and cialis pills, and other products through the use of spam or bulk electronic mail. Lin caused millions of e-mail messages advertising these products to be sent containing falsified header information, or by routing the messages through other computers without authorization. In carrying out this scheme, Lin and the gang caused the introduction into the USA of prescription medications from India, in packages that did not declare their true contents, and sold these drugs in the United States without a prescription as required by the USA’s Food and Drug Administration.
The scheme made over £184,000 (US$350,000) between January and April 2004, when Lin was arrested. At the time of the execution of the search warrant on Lin’s residence in West Bloomfield, Lin, a convicted felon, was in possession of two firearms. Lin, his brother James J. Lin, Chris Chung, and Mark M. Sadek were all charged with sending millions of spam e-mail messages to sell these phony diet aids and illegally imported erectile dysfunction medicine. Prosecutors said they illegally used well-known company and government computers — including Ford Motor Co., Amoco, Unisys, the U.S. Army Information Center and the Administrative Office of U.S. Courts — to send junk e-mail that appeared to be legitimate. Lin faced up to 5 years on each of the spam counts and up to 10 years on an unrelated gun charge. Under terms of the plea agreement reached with federal prosecutors he was expected to also plead guilty to being a felon in possession of a firearm stemming from a previous undisclosed felony in Oakland County.
The USA’s Federal Trade Commission had received more than 10,000 complaints regarding spam sent by the Lin’s Avatar companies, which sent e-mail using “proxy? or ?botnet? computers — computers owned by other companies that hide the true source of the bulk e-mails. The owners of those computers don’t know their equipment was being used. In March 2005, the FTC settled civil charges against Lin and the three men, along with their company, Phoenix Avatar LLC. The defendants agreed to pay a £10,500 ($20,000) civil penalty. The FTC has the authority to bring civil charges for illegal spam use.
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“Internet fraudsters are going to have to face the fact that spamming is a federal crime when it involves accessing the computers of innocent users without permission or using false return information,” said US Attorney Murphy. “Spammers who abuse the Internet to hawk unapproved prescription drugs, illegitimate pseudo-medical products, porn, or any other products should sit up and take notice: illegal spamming can land you in prison.” Postal Inspector in Charge Campbell said, “The Postal Inspection Service’s mission is to maintain the public’s high confidence in the U.S. Mail by investigating those who would use the mail as part of a criminal enterprise. We are proud to have initiated the very first criminal prosecution under the new federal statute, commonly referred to as the CAN-SPAM act, which prohibits abusive and predatory email practices.”
The case was prosecuted by First Assistant United States Attorney Terrence Berg and was investigated by Postal Inspector Karl A. Hansen, both of whom worked closely with Spamhaus investigators and Internet Service Providers in several nations to build the case against Lin and his gang.
Back on Spamhaus UK’s side of the pond there is more good news. ROKSO spammer Peter Francis-Macrae jailed for six years for running a £1.6m e-mail scam has failed in an appeal court bid to quash two of his convictions. Francis-Macrae, 23, of St Neots, Cambs, was found guilty in 2005 of making threats to kill, blackmail, concealing criminal property and fraud. Anthony Martin QC, for Francis-Macrae, argued that the two latter convictions were unsafe. But Appeal Court judges rejected the claim and dismissed the appeal. Peterborough Crown Court had heard that Francis-Macrae had offered thousands of e-mail and website names when he had no right.
When his victims complained, for Francis-Macrae threatened to destroy their internet systems by sending them millions of spam e-mails. When internet registry Nominet posted warnings about his activities, he responded by saying he would attack its servers.
Francis-Macrae, who made more than £100,000 per week from the spam scam, spent £28,000 on designer clothes and flying lessons, the court heard. Mr. Martin QC, for Francis-Macrae, argued that shortcomings in the trial judge’s summing-up had undermined the jury’s verdict. But Lord Justice Moses said: “The jury was in doubt that it should not convict on one count just because he was guilty of another.” He dismissed the appeal.
Looking south across the Straights of Gibraltar, we learn that the Zotob virus writers headed to prison. The two creators of the Zotob Windows worm have been given jail sentences by a Moroccan court. The men behind the malicious program, Farid Essabar and Achraf Bahloul, were caught soon after the virus struck in August 2005. The pair faced charges of conspiracy, theft, using forged credit cards and illegal access to computers. The authorities caught up with the pair less than a fortnight after the virus struck and many anti-virus experts were surprised that they were based in Morocco. Essabar now faces two years in prison, and Bahloul one year.
Essabar is also thought to be behind a several other viruses that targeted Microsoft Windows based systems. The pair were thought to have worked closely with an accomplice in Turkey named by the FBI as Atilla Ekici. The two men’s attorneys said they planned to file an appeal against their sentences. One would hope their appeals are as unsuccessful as the ones spammers Jaynes and Francis-Macrae attempted.
One may remember that the Zotob virus infected the computers of high-profile firms such as CNN, the Financial Times and the New York Times. The worm targeted Microsoft’s Windows 2000 operating system which is widely used by many large companies. At news firm CNN the worm disrupted the station’s live reports. Computers infected by the worm fell into a cycle of constant re-boots. Sadly, other virus writers are still hired by the world’s spam gangs to create software that turns innocent users’ computers into armies of “botnet” spam engines.
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