In October 2004, the Federal Trade Commission started an investigation of reputed spammers. This story just finds a conclusion on May 4th, 2006. Sanford Wallace (nicknamed Spamford) and his company, Smartbot.net, have to shutdown their operation and give up to more than $4 million in ill-gotten gains. Jared Lansky, an ad broker who disseminated ads containing Wallace's spyware, will give up $227,000 in ill-gotten gains.

The FTC alleged that Sanford Wallace and his company, Smartbot.Net, exploited a security vulnerability in Microsoft's Internet Explorer's Web browser in order to distribute spyware. The spyware caused the CD-ROM tray on computers to open and then issued a "FINAL WARNING!!" to computer screens with a message that said :

If your cd-rom drive's open . . .You DESPERATELY NEED to rid your system of spyware pop-ups IMMEDIATELY! Spyware programmers can control your computer hardware if you failed to protect your computer right at this moment! Download Spy Wiper NOW!" Spy Wiper and Spy Deleter, purported anti-spyware products the defendants promoted, sold for $30.

The official documents are available here :

May 4, 2006 :

• Stipulated Final Order for Permanent Injunction and Settlement of Claims for Monetary Relief As To Defendants OptinTrade, Inc. and Jared Lansky
• Order of Default Judgment, Permanent Injunction, and Other Equitable Relief Against Sanford Wallace and SmartBot.Net, Inc.
• News Release

October 12, 2004 :

• Complaint for Injunction and Other Equitable Relief [PDF 34K]
• Memorandum in Support of Plaintiff's Motion for a Temporary Restraining Order with Expedited Discovery, Preservation of Documents and Order to Show Cause Why a Preliminary Injunction Should Not Issue Against Defendants [PDF 68K]
• News Release