MySpace wins record payout in case against spammers

‘Spam Kings’ Wallace and Rines fined maximum amount under federal law.

Social networking site

MySpace

has been awarded a record $230 million in a

lawsuit it filed

against well-known spammer Sanford Wallace and his partner Walter Rines after the defendants failed to appear in court.

MySpace

brought the case against the spammers when it discovered that they had used phishing practices to obtain login details from

MySpace

users. Wallace and Rines then used the stolen IDs and passwords to log into the social networking site and distribute spam messages to the users’ friends lists.

Court documents indicate that the pair distributed more than 735,000 messages during the scam, earning over $500,000 in the process.

As well as being the largest amount awarded in the US since the introduction of the CAN-SPAM Act in 2003, the fine is also the maximum fine possible under federal law. The pair were fined $163.4 million under two parts of the CAN-SPAM ruling, while Rines was fined an extra $63.4 million, part of which was for violating the anti-phishing laws of California, and the pair were ordered to pay in excess of $4 million in legal fees.

Wallace was one of the biggest spammers in the late 1990s and, despite announcing in 1998 that he was quitting the spam business (he didn’t, at least not for long), and agreeing in 2005

to put a hold on

his spamming activity until a court case with the FTC had been resolved, his activity in the spamming/phishing/spyware operating area has continued to be prolific.

‘I applaud the judge for taking a tough stance against the pair of spammers in this case – we so often hear about the same people and companies being sued for their spamming activities, and Sanford Wallace is a case in point,’ said Helen Martin, Editor at Virus Bulletin, ‘while tougher legislation is still undoubtedly required to ensure people are discouraged from engaging in this sort of criminal activity, the ruling in this case will certainly send a strong message to would-be spammers.’

Posted on 14 May 2008 by

Virus Bulletin