Judge orders weight-loss spammer to pay $2.5 million

A federal judge has ordered a purveyor of weight-loss and human-growth hormone-related products to pay more than $2.5 million for violations of the FTC Act and the CAN-SPAM Act.

U.S. District Court Judge David Coar last month ordered Sili Neutraceuticals and Brian McDaid, who does business as Kaycon, to also cease misrepresenting its hoodia products and cease sending spam.

Coar found that the company violated the FTC Act by claiming in emails that its hoodia products cause rapid and permanent weight loss, and that its HGH products reverse the aging process.

The judge also ruled that Sili violated the CAN-SPAM Act by sending commercial emails with misleading headings that do not allow the recipient to decline messages. The junk mail also had no functioning return email address or physical postal address, according to the Federal Trade Commission (FTC).

Contact information for Sili could not be immediately obtained.

The FTC credited Microsoft and SecureWorks, an on-demand network security provider, with assisting in their investigation.

The agency charged Sili last August with making false and unsubstantiated claims about hoodia products and HGH anti-aging products, saying at the time that the company claimed its merchandise could result in weight loss of up to 40 pounds a month.

Anti-virus giant Symantec said Tuesday in its monthly State of Spam report that spam volumes increased this year after the end of the holiday season, bucking conventional wisdom.

Spammers are also using seasonal messages, such as Valentine's Day greetings and income tax-return deadline alerts, to lure end-users into opening their messages, Symantec said.

The Cupertino, Calif.-based company also noted that, for the third month in a row, the percentage of spam messages originating from Europe surpassed that from North America, a significant shift in the source of junk email.

About 44 percent of all spam now comes from Europe, compared to 35 percent from North America. Last August, North America outpaced Europe in junk email production by 16 percent.

The sudden increase could be a result of rising overseas high speed internet usage, said Symantec researcher Kelly Conley.

“The past few years have seen a massive growth in broadband users in Europe. As of June 2007, Europe had six of the top 10 countries for broadband users in the world,” Conley said Tuesday on the Symantec Security Response blog. “This massive growth in broadband users does appear to correlate to the sizeable increase in spam originating from Europe.”

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