The issue began when Knowledge Matrix, Inc, spammed the CEO of Gage E-Services, Matt Gage.  Gage, who already had an on-going lawsuit against a company in Denver who did the same thing, promptly sued Knowledge Matrix as well, demanding $750 and quoting the state’s 2007 anti-spam law which forbids companies from sending marketing emails to people they don’t already have a relationship with and:

South Dakota’s statute says that a person’s email address cannot have been collected in an automated way or bought from a company that uses automation. The subject line of such emails must indicate it’s an advertisement.

Knowledge Matrix promptly filed suit and asked the court to block Gage E-Services from taking any action against them. They claim the message they sent him was in full compliance with the CAN-SPAM Act, and that that law, enacted in 2003, should take precedence over South Dakota’s law.

“This is really a debate about whether what we’re dealing with is free speech or harassment,” said Joel Dykstra, the former South Dakota lawmaker who pushed the state’s 2007 anti-spam bill.

What do you think? Should CAN-SPAM be the predominate law in this case or is Gage E-Services justified in wanting to hold them to the South Dakota law? Do you think their lawsuits against the companies they say spammed them are appropriate? Why or why not? Please leave a comment and share your thoughts with us.

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Company Sued for Spamming Retaliates to Have Spam Law Repealed

It may be the dog days of summer, but spam never takes a vacation. Here’s a look at the latest spam headlines and trends.

Maryland Rep’s Hurricane Spam Raises Ire and Questions

“Spam King” Indicted on New Facebook Spam Charges

Botnet Criminals Getting Desperate

Canadian Businesses Prepare for New Spam Law

Spam Volume Reaches Pre-Rustock Takedown Levels

Know of a story we missed or have something to say about one of the stories above? Leave a comment and talk to us!

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August Spam Roundup

          “ACMA expects that Australian businesses take note of this outcome,” ACMA chairman Chris Chapman said. “Under the Spam Act, every person has the right to unsubscribe from receiving commercial electronic messages and to have that request acted on effectively and quickly. The failure to act on a request can result in significant penalties if a business is found to have breached the Act.”

CommSec sent over 6 million advertising emails in 2009. The company says it has agreed to have an independent consultant to review its compliance systems and to also provide additional training to its staff.

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Australian Financial Firm Fined 55K For Spamming

The U.S. Federal Trade Commission has fined a New Zealand man $15 million; Spamhaus claims this is one of the largest spam gangs in the world. The gang, operating under the names “Canadian Healthcare” and “HerbalKing” has been operating since 2005 and has sent billions of spam messages hawking male enhancement products, weight loss pills and other pharmaceuticals. The spam messages directed the recipients to websites owned by an affiliate network called Affking. The sites claimed to be offering drugs from U.S. pharmacies when they were actually shady black market drugs made in India. They also stole credit card information and personal data. The gang appears to have made their profits from all three operations – the fake drugs, the affiliate network and the data harvesting.

The drugs are untested and could be dangerous if used. The gang leader, Lance Atkinson, and his partner Jody Smith, were also ordered to turn over all their assets, which amount to over $1 million, and Smith faces jail time. Their company, Inet Ventures Pty Ltd, registered in Australia, has received over 3 million complaints from consumers. Spamming seems to run in the family. Atkinson’s brother, Shane was fined over $112,000 earlier this year by a New Zealand court for his spamming activities.

Atkinson is a New Zealand citizen living in Australia, which will make collecting on the fine difficult. He’s not required to pay unless he enters the U.S. Smith however, does live in the U.S. and will soon be sentenced for conspiracy to traffic counterfeit goods, which he pled guilty to. The conviction carries a maximum 5 year sentence.

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U.S. Fines Spammer $15 Million

In my recent post on spam vs email marketing it was mentioned that a global law enforcement body may be what we ultimately need in order to fully address the problem of spam.

Some companies have tried to tackle the problem themselves, such as Microsoft offering a reward for information leading to the arrest of the person responsible for the Conficker worm.

One state in Australia has taken the problem seriously and is trialing a system that will permit victims of Nigerian phishing scams to report their case directly to authorities in the African nation.  Queensland police Detective Superintendent Brian Hay leads the Fraud and Corporate Crime Group which has also developed other initiatives to prevent internet fraud or make it easier to report and investigate.

          In the early stages, we’re having some wins. Some of those investment and inheritance scams are reducing but the big problem that we’ve got now is we’ve seen a 100 per cent increase in romance and relationship scams. It’s just gone through the roof.

How effective this will ultimately be is unknown, given that spammers have a track record of constantly adjusting their methods to get around new prevention techniques.  It is hoped that more open communication and effective reporting may make it easier for authorities in countries such as Nigeria to permanently strike at the root of the problem.

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International Spam Fighting

Schenkhuizen continues to deny that he is a spammer and plans to appeal the ruling. He claims that the emails customers send with his email client do have an ad for his company in them but that it can not and should not be considered spam. However, Schenkhuizen’s business is described as an “internet promo” company which really does seem like a fancy way of saying spamming.

It is encouraging to see European countries getting tough on spam. Many spammers user servers and ISPs located overseas because it is easier to avoid detection and prosecution there. Hopefully if more and more countries develop tough anti-spam and anti-cybercrime laws the war against spammers and hackers will finally make some real headway.

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Dutch Spammer Fined Over $300,000