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FTC demands bigger spyware penalties

Raising the fine line

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US consumer watchdog the Federal Trade Commission (FTC) is calling for a bigger stick with which to punish spyware purveyors.

As things stand the FTC is only able to collect profits illegally gained by infecting victims' PCs with malware along with obtaining financial redress for consumers. A brace of bills that would give the agency powers to impose fines are both stalled in congress.

The House passed the Spy Act and the I-Spy Act in May and June, respectively. The senate is yet to consider the proposals.

The FTC already has the ability to fine spammers. Giving it the same ability in spyware cases would act as an "enormous deterrent", FTC commissioner Jon Leibowitz told a spyware summit held in Washington DC.

He said quantifying how much money consumers had lost as a result of pop-up infections and the like was tricky, arguing that attempts to obtain consumer redress were failing.

"Right now, companies know that the worst they can do is lose their profits," Leibowitz said, IDG reports. "They're not going to get fined on top of that."

Leibowitz is on the record dissenting on agency settlements with firms held liable for distributing adware. The FTC fined DirectRevenue $1.5m, based on its profits from distributing adware, in February. Leibowitz disagreed with the decision arguing that after pulling in $20m in venture capital funding the founders of DirectRevenue would still be "lining their pockets from a business model based on deceit".

In related news, the FTC warned on Monday of a forged email message that tries to scare users into visiting a site hosting malware. The bogus messages falsely warn recipients that they have become the subject of a fictional FTC probe. For good measure, the emails also contained an infected attachment. ®

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