British 'rogue dialers' face heftier fines

Parliament on Wednesday agreed that, as of Dec. 30, companies caught abusing U.K. premium-rate services should be liable to fines of up to 250,000 pounds ($434,281), up from the existing limit of 100,000 pounds ($173,998).

Many thousands of dial-up Internet users have fallen victim to rogue dialers throughout 2005. Once installed on a dial-up user's PC, the applications can secretly dial a premium-rate number. This has led some people to run up call charges of hundreds of pounds.

It's thought that many rogue dialers are spread using Trojan horses contained within spam e-mails.

Last month, Ofcom warned that there was "growing evidence of consumer harm" arising from rogue dialers. Victims include Microsoft UK's chief security advisor, Ed Gibson, who admitted in September that he had been hit with a 450 pound ($782.59) bill after becoming infected.

According to Icstis, which regulates the U.K. premium-rate market, the maximum fine had to be raised because companies conducting rogue-dialer scams would often generate more than £100,000 before they were caught. Icstis is now examining whether it can impose a separate fine for each individual offense, which could push the actual maximum fine into the millions of pounds.

"Telephony and the Internet are crucial to a modern, global economy. All of us expect to use them without the threat of exploitation by rogue companies prepared to exploit genuine consumers," said Alun Michael, British minister for industry and the regions. "This new fine level helps ensure that Icstis has the tools it needs to protect consumers and build trust in the premium-rate payment mechanism."

The higher fines will also apply to fraudulent text messages and voice mails that tell people they have won a prize.

Graeme Wearden of ZDNet UK reported from London.