Spam and obscene profits

Spam: Let’s Re-Define ‘Obscene Profits’

I took a great call today with Garth Bruen of Knujon (“No Junk” spelled backwards). Garth’s volunteer organization monitors spam and works with Internet registrars to throttle the miscreants who fill our in-boxes with this junk. Garth gave me a great background on the current situation in spam.

One of the many themes that we discussed included the profits that Internet registrars make from spammers and the criminal enterprises they directly or indirectly abet.

Registrars, for the most part, should be profitable businesses. Most do little advertising in traditional media. Go-Daddy is the clear exception here with its television ads and 1&1 uses a lot of print media. Most registrars utilize web based advertising and, not surprisingly, bombard their own customer base with emails (like a spammer?). Registrars are not new and most collect decent monthly and annual fees from the people and firms who register sites via their service. I would bet a large number of these registrations occur online and without human intervention. I have to believe these firms make decent profits from these registration and follow-on services (e.g., hosting and web design) that they offer. Let’s call this normal profit.

Obscene profits occur when registrars knowingly permit spammers to buy huge blocks of web addresses to further their questionable activities. In an age where analytic applications are becoming pervasive, why wouldn’t a registrar develop analytic measures to detect and halt improper behavior? It’s got to be money related. They’re addicted to the easy, straight to the bottom line money that this activity generates for them. Let’s call this obscene profit.

So what, you might argue. Is this behavior really hurting anyone? Well let’s examine a few practices of spammers and see what other behavior creates the opportunity for obscene profits for registrars.

Example #1

If your firm is like most, you have registered a master domain name that incorporates your firm’s name (www.yournamehere.com). You also registered a few other names that resemble the previous one except for a different final extension (e.g., www.yournamehere.org). But you didn’t register thousands and thousands of unrelated names although a spammer would.

Some spammers don’t even hide their intent from Internet registrars who gladly let them register thousands of sequentially named domain names (e.g., www.abcdef123456.com, www.abcdef123457.com, www.abcdef123458.com, etc.). These spammers will use these domain names to send spam and/or cross-link to a domain name they’d like to sell to another firm. The reason for this is that they want to ‘prove’ how popular a domain name like www.good_domain_name.com really is. They load up a bunch of traffic on this sham site just to tart it up and justify their high re-sale price. One such firm did this to an old site I let intently lapse.

In common law, Fraud occurs when one of the parties has acted 'with an intent to deceive'. If you are buying one of these adulterated domain names, you have been deceived and you should pursue a claim of fraud against the perpetrator.

Example #2

When a registrar refuses to shut down bogus sites that promise “easy credit”, they abet criminal organizations that are using these online store fronts to dupe naïve or desperate people to divulge their financial information. When a registrar refuses to verify or ensure that the company offering the easy credit actually:

- exists - has a real street address (not a rent-a-mailbox) - uses an address that matches the state where the easy loans are being processed - has real human beings as named contacts for the site - etc.

then they permit miscreants to develop sites that harm others. This lack of policing may enrich the coffers of the registrar and the spammer but it is economically damaging to the victims of these credit and identity theft crimes. I’d call those registrar profits ‘obscene’.

Example #3

How about the spammers who inundate us with offers to sell drugs from China, India, Canada or the UK? This is a really serious problem with very serious consequences. If you make a purchase from these firms, there is a high degree of certainty that the product you ordered is not what you’ll get. You may get:

- your identity stolen - worthless counterfeit medicine - poisonous counterfeit medicine - highly diluted version of the medicine you requested - a contaminated or impure version of the product - killed

The trade in internet drugs is particularly troubling as these merchants are not the teenage hackers that some people think of when they think of Internet troublemakers. No, many of these operations benefit organized crime, corrupt foreign governments, terrorist groups and others. Helping these groups is clearly contrary to public policy.

Registrars who aid and abet this kind of activity are, in my opinion, as culpable as the criminal enterprises behind these spam messages. I’m waiting for a registrar to be sued as a co-defendant in someone’s counterfeit medicine injury or death. Alternatively, I’m sure an ambitious district or federal attorney will soon see a RICO (Racketeer Influenced and Corrupt Organizations Act) angle here and prosecute a registrar for their part in a criminal conspiracy. If a registrar is turning a blind eye to this activity just to make some short-term money, I’d say these profits fit the ‘obscene’ label.

Knujon is an interesting organization. It is a small, volunteer group that wants ICANN, registrars and others to follow the rules that supposedly govern the Internet. Please read their reports, send them your spam and help them pressure the registrars to make the Internet a safer place for us all.