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Notorious Kiwi pill spammers slapped with fine

Herbal King dethroned

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A gang of notorious spammers from Christchurch, New Zealand have been hit with fines in the first prosecution under the country's anti-spam laws.

Shane Atkinson was fined $71,870 (NZ$100,000) while his partner-in-spam Roland Smits was ordered to hand over $35,915 (NZ$50,000) after the duo were convicted of sending out millions of spam emails selling penis enlargement and weight loss pills under the brand name Herbal King.

Atkinson's brother Lance, who lives in Queensland, Australia, avoided a trip to jail after confessing his involvement in the scam and agreeing to pay $71,870 (NZ$100,000) plus costs. The case over violations of New Zealand's Unsolicited Electronic Messages Act in 2007 was dealt with by the High Court in Christchurch.

The gang hid their tracks by sending the spam from New Zealand, while maintaining knock-off pharmaceutical production and distribution facilities in India and registering their firm in Mauritius. This elaborate camouflage and misdirection approach came unstuck after a Danish anti-spam activist hid code in an order form that tracked the progress of an order across the web, 3 News New Zealand reports.

The Herbal King spammers, who at their peak ran the "largest pharmaceutical spamming operation in the history of the internet", were also the target of a US Federal Trade Commission enforcement action involving the seizure of assets and bank accounts.

It's hard to imagine that the modest fines imposed on the gang in New Zealand are any more than a small fraction of their illicit income.

Nevertheless, a NZ government statement on the case, Internal Affairs Deputy Secretary Keith Manch said enforcement of local anti-spam laws would stop New Zealand becoming a spammer’s haven.

"Operation Herbal King is a major success for the Department and its small Anti-Spam Compliance Unit," Manch said. "Following the passing of the UEM Act, we entered into international agreements to share information about spamming and pursue cross-border complaints."

More details of the Herbal King gang's spamming tactics, which included the use of botnets and so-called bulletproof hosting, can be found in a write-up by anti-spam organisation Spamhaus here. The group (whose activities earned it a place on Spamhaus's ROKSO list of the world's most prolific spammers) also dabbled in luxury goods and porn as well as pharmaceutical spam. ®

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