As part of a recent crackdown on spyware, the Federal Trade Commission has shut down a Canoga Park firm for allegedly installing illicit software code onto computers through the use of pop-up windows and advertisements.
The FTC complaint accuses Enternet Media Inc. and its executives of working with an affiliate marketer, Nicholas Albert, to distribute spyware onto computers by luring users with pop-up ads for free music files, cell phone rings, photographs and song lyrics. Enternet Media also used installation boxes that looked like security warning messages, according to the complaint.
The spyware allowed Enternet Media to track Internet activity, change home pages and place a toolbar on Web browsers that displayed legitimate advertisements, the complaint alleges. "If they clicked on those boxes, they would have spyware downloaded onto their computer," said Tara Flynn, assistant director of marketing services and supervisor of the case for the FTC.
The spyware was distributed through names such as www.searchmiracle.com, www.c4tdownload.com and www.cash4toolbar.com. Additionally, the spyware was bundled through music files offered on Albert's affiliate site, www.iwebtunes.com, for use on blogs, which subsequently displayed the same pop-up ads to visitors of those blogs.
The FTC shut down Enternet Media's main line of business by convincing U.S. District Judge Christina Snyder to temporarily freeze the company's operations.
Enternet Media said it is taking steps to get up and running again while the freeze is in place. "What we want to do is fashion a business model that will comply with the judge," said Anthony Dain, a partner at Procopio Cory Hargreaves & Savitch LLP in San Diego who is representing Enternet.
Dain called Albert a "rogue affiliate bundling the software with other software that was causing multiple pop-ups." He said Enternet Media's software only allowed five pop-ups within a 24-hour period but that the company planned to further control its number of pop-ups in the future.
To comply with the judge's order, Enternet also planned to alert consumers who click on ads for free music files or ring tones that they automatically download the company's toolbar.
Albert couldn't be located for comment.
The FTC also sued Conspy & Co. Inc., a separate company with the same address and principals at Enternet Media. Dain said the company was "unrelated" and "involves overseas applications that are not related to the toolbar and are within the confines of the laws of the countries they're doing business in." He declined to elaborate further.
The FTC investigation was brought with the assistance of Microsoft Corp., Webroot Software Inc. and Google Inc.
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