Cough up fat wad of cash – or be tagged for six months with jail hanging over you?
On Monday, the US Federal Trade Commission reached a settlement with six people accused of running a technical support scam in Ohio, USA. Using a variety of shell companies, they allegedly placed pop-up adverts on websites that looked as though they came from a computer’s operating system warning of a virus infection and telling the user to call a toll-free number for help.
That was the only free part of the experience. Once a customer dialed in, they were encouraged to give remote access to their system to an “expert,” who claimed to be an officially approved Microsoft or Apple technician qualified to work on their machine, the FTC alleged.
The support person would then run
msconfig, and claim that all of the stopped Windows processes were evidence of a virus outbreak, the watchdog said. Alternatively, the simple
dir /s command was used, and marks told that all the files listed were part of the virus, it is alleged.
After lying about the presence of malware, the scammers then offered to sell a one-off fix or a longer-term support contract that could cost $500, it is claimed. If the victim wasn’t interested, their system would sometimes be locked by the “technician” using the
syskey application, who would then use this as further evidence of an infection, the regulator said.
After an investigation, charges were filed [PDF] in 2017 against six people and a bunch of businesses accused of running the scam, and the case was eventually settled out of court this week. The group agreed not to offer technical support in the future, and the FTC told them cough up $24.8m in total.
The defendants were: Repair All PC LLC; Pro PC Repair LLC; I Fix PC LLC; WebTech World LLC; Online Assist LLC; Datadeck LLC; and I Fix PC dbaTechers247 – as well as individual defendants Jessica Marie Serrano; Dishant Khanna; Mohit Malik; Romil Bhatia; Lalit Chadha; and Roopkala Chadha.
“This scheme affected people in Ohio and across the country, and we were pleased to work with the Federal Trade Commission to shut it down,” said Ohio’s Attorney General DeWine on Monday. “Scams regularly cross state and national borders, so this kind of collaboration is an important part of protecting consumers.”
Sounds like justice has been done… until you look into the details. In fact, the FTC agreed to suspend all the fines if the scammers paid just $149,337.38 total to Uncle Sam, and will only have to pay more if they are caught trying to pull the same wheeze again.
Meanwhile, in Britain
A very similar case was settled by Britain’s National Trading Standards agency on Friday, but with very different results.
Whereas the FTC prefers to reach deals and avoid trials, the British take the opposite approach. As a result, Narendra Harilal Vadgama, of Babington Road, Barrow upon Soar, England, was taken to court, and admitted four charges of breaking the Consumer Protection from Unfair Trading Regulations 2008.
Like his American counterparts, 56-year-old Vadgama also used pop-ups to convince computer illiterates that they had an infection, but also cold-called people just on the off chance he could convince them they needed some expensive technical support.
His Honour Judge Andrew Stubbs QC sentenced Vadgama to a year in prison, although this was reduced to nine months, and suspended in exchange for a guilty plea – meaning he won’t go to jail unless he breaks the law again. Vadgama was also ordered to wear an electronic tag, and be placed under a 8pm-8am curfew for six months, and was banned from being a company director for seven years.
“All those who use computers are concerned with internet safety. You saw a business opportunity,” Stubbs said. “Some of the victims are people who are nervous and lack knowledge that you plainly obtained. They are vulnerable to be scammed like they were by people operating for you. You simply didn’t care what was happening.”
While it’s disappointing Vadgama didn’t get jail time, the cases highlight the difference in regulations between the two countries. If you were a scammer, which nation would you prefer to operate in? ®