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Feds Kick Off 'Spam' E-Mail Crackdown

February 12, 2002 

WASHINGTON (Reuters) &30151; Federal regulators kicked off a crackdown on the junk e-mail known as "spam" on Tuesday with an announcement that they had settled charges against seven people accused of running an e-mail chain letter that promised quick money.

The Federal Trade Commission said that the seven defendants had participated in a scam that promised returns of up to $46,000 for a $5 payment. Such chain letters are illegal in the U.S.

The chain letter eventually drew in more than 2,000 participants from nearly 60 countries, the FTC said.

Other participants received a warning letter from the consumer-protection agency.

While the FTC has long targeted pyramid schemes, chain letters and other consumer scams, it has not until now gone after e-mail based schemes.

FTC Chairman Timothy Muris said that the agency now had spammers in its sights.

"We're going after deceptive spam and the people who send it. We want it off the Net," Muris said in a release.

Spam has long been a hot-button issue for Internet users, who often find their inboxes clogged with unsolicited offers for pornography, fake diplomas, and get-rich-quick schemes.

Internet users received an average of 571 pieces of unsolicited commercial e-mail in 2001, a number expected to rise to nearly 1,500 by 2006, according to Jupiter Media Metrix.

Attempts to pass a national anti-spam law have stumbled over opposition from direct marketers who say their activities would be unfairly limited. Nineteen states have passed such laws.

FTC officials said on January 31 they would go after spam using existing laws that prohibit false or deceptive trade practices.

Spammers are not likely to face jail time or large fines from FTC actions. In deceptive-trade cases, the agency can usually only force companies to give back profits and pursue "structural" remedies that modify future behavior.

The seven spammers agreed with the FTC to refrain from participating in deceptive schemes in the future, or lying about the legality or potential earnings from any such schemes. In addition, the defendants must return any money they take in from the chain letter in the future, can not share their lists of recruits, and must submit to FTC oversight of their actions.

By Andy Sullivan. Copyright © 1999-2002

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