Skip to main content

Thank you for being here, this morning. Today we're announcing the FTC's 100th case targeting Internet scams, and I think of all 100 cases, this one may be the most pernicious we've seen.

Before we begin, I want to say how pleased we are to be joined this morning by video link to Allan Asher the Deputy Chairman of the Australian Competition and Consumer Commission (ACCC). We are grateful that the A triple C has worked very closely with us in this matter. Because fraud on the Internet erodes consumer confidence, cross-border coordination is critical to ensuring that national boundaries do not insulate perpetrators. Good morning, Allan.

We're also pleased to have John G. Fischer, here to represent one of the victims of the scam we've taken action against.

Our technoexperts will describe shortly how this scam worked. Let me tell you quickly, what the scammers did.

Using two technological dirty tricks - "pagejacking" and "mousetrapping" - they copied other web sites; captured unsuspecting Internet surfers; took them to sexually-explicit adult Web sites against their will; and held them hostage there by disabling the controls on their Internet browsers.

But you will see for yourself. Don Blumenthal and Paul Luehr of the Bureau of Consumer Protection, will demonstrate the technology without the very graphic, offensive material. It has been expurgated. It was not deleted in our evidentiary presentation to District Court to convince the court that in the interest of the integrity of the Internet, the Web sites that were copied, and consumers worldwide, this scam should be shut down immediately and permanently. As you look at the blank squares that represent the lurid photos we have removed, imagine the reaction of a parent who walks into a room as his child has fallen into this trap.

(demonstration)

These operators highjacked websites, kidnaped consumers and held them captive. They exposed surfers, including children, to the seamiest sort of material and incapacitated computer "close" buttons so they couldn't escape. They copied as many as 25 million Web pages from sites as diverse as the Harvard Law Review and the Japanese Friendship Garden. When consumers used search engines to find subjects as innocent as "kids on the net," "news about Kosovo," or "wedding services," they risked being exposed to a torrent of tawdry images. This scam is outrageous and we want it off the net. We're confident the court and our colleagues in Australia will help us arrange that.

We have asked for and received a preliminary injunction, pending trial, against the defendants in the case. Now I'd like to introduce Allan Asher of the A triple C to talk about the law enforcement efforts in Australia.

(Mr. Asher)

I know I speak for both the FTC and the ACCC in emphasizing the significance of getting operators like this off the 'Net and keeping them off. We see the enormous potential of the Internet for education, communication and commerce. But this kind of treachery, left unchecked, will surely sabotage confidence in this great new medium. Someone who can speak with direct experience is John Fischer.

(Mr. Fischer)

Thank you. I also want to recognize the Portuguese Instituto do Consumidor, which also is working with us on this law enforcement initiative.

Finally, I want to say that this case was investigated and evidence was gathered in the FTC's new Internet lab. The lab was established to provide agency lawyers and investigators with hi-tech tools to investigate hi-tech consumer problems. It allows investigators to search for fraud and deception on the Internet in a secure environment. To capture Web sites that come and go quickly, the lab also will provide FTC staff with the necessary equipment to preserve evidence for presentation in court. We'll take your questions, and then we invite you for a quick tour of the lab.

Return to top