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Spam tool developer faces six years in chokey

Ralsky cohort cops a plea

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A US software writer has pleaded guilty to developing a botnet-based spamming tool used by notorious spammer Alan Ralsky.

David S Patton, 49, of Centreville, Virginia, faces up to six years in prison after pleading guilty to aiding and abetting breaches of the US CAN-SPAM Act in concert with Ralsky and others. Patton agreed to forfeit an estimated $50,100 from sales of spamming tools called Nexus and Proxy Scanner, as well as paying a nominal fine of $3,000.

Between January 2004 until September 2005, Patton developed and marketing his illegal bulk mailing tools via a firm called Lightspeed Marketing. Nexus was designed to falsify the headers of spam messages while Proxy Scanner was designed to channel junk mail through compromised zombie proxies, typically PCs in either homes or businesses infected with Trojan horse malware.

Patton is the 12th defendant charged over involvement in a pump-and-dump stock price scam operation masterminded by Ralsky, which was dismantled following a three year FBI-led investigation. The fraud - which grossed an estimated $3m in just 18 months - involved inflating the price of thinly-traded stocks owned by people based in China and Hong Kong.

Detroit-based recidivist fraudster Ralsky, who copped a plea last month, faces up to seven years behind bars over the scam.

In related cybercrime news, Indian citizen Jaisankar Marimuthu, 34, was extradited from Hong Kong to the US on June 20 where he faces charges of hacking into online brokerage accounts in order to artificially inflate the value of low-value stock he held. He entered a not guilty plea on 25 June.

Marimuhu is one of three people accused of hacking into brokerages include E*Trade and TD Ameritrade and creating 60 false accounts using stolen identities in 2006. Fraudulent trades made through these accounts raked up losses of more than $2m, Computerworld reports.

A DoJ statement, which provides more background on the alleged "hack, pump and dump" scam, can be found here. ®

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