FTC takes "bold" spyware actions

In a bold move, the Federal Trade Commission has temporarily shut down a software vendor that used allegedly false scare tactics to increase sales. Bold, that is, if it had taken the action -- oh, say -- five years earlier.

Free IT resource Virtualization Insights from Top Experts - Learn how virtualization gets real! Sponsored by Dell Free IT resource TechNet: More ways to know it, share it, and keep it running. Sponsored by Microsoft

The FTC says MaxTheater, maker of Spyware Assassin, tried to scare consumers into buying software through a variety of pop-up ads and e-mail messages that informed consumers their computers had been infected with malicious monitoring software.

Remember those? These pop-up ads would open in the middle of an online session to warn -- in bold capital letters -- that "Your system is infected with spyware." You could close the pop-up, but some of you no doubt wondered if just maybe… .

Well, a friend of mine did. He clicked the ad. And on my computer, no less.

I don't know whether the little rascal was from MaxTheater, but when my friend clicked the pop-up's button, the program bombarded me with ads and inserted itself on top of my home page like an annoying younger sibling. It took a lot of persistence to remove all the cookies, files, and other general nonsense from the system. I would think the system was clean, and I'd happily surf for a couple of weeks and then -- boom! The unwanted Web page would show up again as my home page. It's finally gone (I think), but certainly not forgotten.

According to the FTC, MaxTheater would produce evidence of spyware even on systems that were clean, and even more galling, its $30 program did not actually remove the spyware. The program was a little like an exterminator who crawls under your house, comes up with a board covered in bugs, and then sprays the foundation with water and hands you a hefty bill.

A U.S. court has ordered MaxTheater to suspend its activities until a court hearing on Tuesday. The court could compel the company to give back all the money it made from selling Spyware Assassin. I'm sure that will happen, just like how Enron is going to cough up all the money it hornswoggled from investors over the years.

The FTC also recently issued a report that boldly -- there's that word again -- identifies spyware as "a real and growing" problem. To repeat: bold, that is, if it had taken this action five years earlier.

Several months after holding a spyware workshop, the FTC released a report with the findings and a transcript of the workshop. The report includes remarks by the commissioner of the FTC, whose name is, I kid you not, Orson Swindle.

In the transcript of the workshop sessions, there is a lot of discussion about the differences between adware and spyware and how legitimate adware crosses the line and becomes spyware. The FTC report recommends government and industry actions and asks the business community to come up with a working definition of spyware (to distinguish it from adware). It may sound a bit lame, but at least it's a start to dealing with the problem.

As a side note: I've been writing about new mobile viruses recently, and InfoWorld put together several stories on the subject. You can find some of those stories here.