Two anti-spyware manufacturers have opted to avoid trials and settle with the Federal Trade Commission, which charged not only that their free spyware scans were in fact scams but that their e-mail messages offering their products constituted spam.
In the first half of 2005, the FTC had alleged that the operators of SpyKiller and Spyware Assassin claimed to be able to detect the spyware on a user’s hard drive even when such programs weren’t present. Both operators then sold users software programs that supposedly could delete and block spyware but which in fact did nothing or did not work as advertised.
In the case of Trustsoft, the maker of SpyKiller, the FTC alleged that the company sent pop-up and e-mail messages informing consumers that their computers had already been “scanned” remotely and that spyware had been found. In fact, what the SpyKiller scan categorized as “live spyware processes” were in fact anti-virus tools, word processing programs and other legitimate software, according to FTC findings.
Consumers who agreed to the “free” remote scan were then charged around $39.95 to unlock SpyKiller’s “removal” capabilities—which in turn failed to remove large amounts of the specific spyware the marketing materials said it would delete. Thus the FTC’s charges against SpyKiller included claims of false advertising.
Those charges said that e-mail promoting SpyKiller contained the same deceptive claims and in addition violated the Can-Spam Act by not identifying the messages as advertising, by using false addresses in the “from” line, by failing to include valid postal addresses and by omitting clear opt-out instructions for recipients.
The FTC leveled similar charges of deceptive sales practices against MaxTheater Inc., the makers and vendors of Spyware Assassin. Consumers were led to the Web site using e-mail, banner ads and pop-ups and offered free remote scans—which usually turned up positive results, whether their hard drives were infected with spyware or not. Users were urged to purchase Spyware Assassin for $29.95 to counteract the problem, but the FTC found once again that the software did not remove spyware effectively and that the maker’s claims were therefore deceptive.
In the settlements announced yesterday, Danilo Ladendoft and Trustsoft agreed to pay $1.9 million, to stop misrepresenting SpyKiller’s abilities, and to refrain from making deceptive claims regarding any future product or service. Thomas Delanoy and MaxTheater will pay $76,000 and have been barred from making or selling any anti-spyware product or service in the future.
MaxTheater’s penalty figure was apparently the full extent of the consumer injury from SpyKiller. In the words of the FTC release announcing the settlements, “Both operators will give up their ill-gotten gains.”
