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Spam King Sentenced to 4 Years in the Slammer

Paul Lilly — Tue, 24 Nov 2009 13:55:07 -0600

The feds have dethroned another "spam king," who, like the ones before him, will spend a little bit of time behind bars. Alan Ralsky, 63, pleaded guilty to commit wire fraud, mail fraud, and to violating the federal CAN-SPAM Act.

What landed Ralsky in hot water was allegedly sending out unsolicited email to jack up the price of penny stock in Chinese companies to artificially high prices, and then selling it. Ralksy's Internet stock scheme netted him $2.7 million, as well as the attention of the feds and ultimately a 4-year prison sentence.

"With today's sentence of the self-proclaimed 'Godfather of Spam,' Alan Ralsky, and three others who played central roles in a complicated stock spam pump and dump scheme, the court has made it clear that advancing fraud through abuse of the Internet will lead to several years in prison," said U.S. Attorney Terrence Berg. "I commend the FBI, the Postal Inspection Service, and the IRS Criminal Investigative Division for their determined and careful investigation in this case which led to today's result."

Ralsky, who pleaded guilty back in June of this year, may have gotten off a little light, as he faced up to 7 years in prison.

"iPod Mechanic" Behind Bars for iPod Scam

Paul Lilly — Wed, 26 Aug 2009 20:05:31 -0500

As another reminder that crime doesn't pay, 23-year-old Nicholas Woodhams, also known as the "iPod Mechanic," faces 13 months in prison after pleading guilty to mail fraud and money laundering charges. Woodhams was also ordered to pay $648,568 in restitution to Apple and $8,066.85 to the U.S. Postal Service, Arstechnica reports.

According to the lawsuit, Woodhams ran a scam of exploiting Apple's advance replacement system for the iPod shuffle and reselling them through his own website. He also allegedly exploited Apple's iPod Warranty Service Program to get Apple to repair out-of-warranty iPods.

Woodhams' scam proved rather lucrative, but it's all going back. In addition to the above jail time and fines, Woodhams must forfeit about $750,000 worth of criminally acquired assets, including his house in Michigan, an Audi S4, an Ariel Atom 2, a Honda motocyle, and over $500,000 in cash. Ouch.

Spammer Pleads Guilty to Stock Fraud, Faces 7 Years in Prison

Paul Lilly — Tue, 23 Jun 2009 14:00:32 -0500

Alan Ralsky, a West Bloomfield, Michigan native, has pleaded guilty to allegations of wire and mail frauds, money laundering, and of violating the CAN-SPAM Act. As a result, Raslky faces up to 7 years in prison.

"Alan Ralsky was at one time the world's most notorious illegal spammer," said U.S. Attorney Terrence Berg. "Today Ralsky, his son-in-law Scott Bradley, and three of their co-conspirators stand convicted for their roles in running an international spamming operation that sent billions of illegal email advertisements to pump up Chinese 'penny' stocks and then reap profits by using trades in these same stocks while others bought at the inflated price."

In addition to duping recipients with falsified emails, the conspirators used software that made their messages hard to track, used illegal methods to get around spam blockers, falsified headers, and used proxy computers to relay the spam and falsely registered domain names, according to the Department of Justice. Their efforts reportedly brought in over $3 million.

While many of cases are still spending, Scott Bradley, Ralsky's 38-year-old son-in-law, pleaded guilty to the same charges and faces up to 78 months in prison and $1 million fine. John Brown, 45, of Fresno California, pleaded guilty to conspiracy to commit wire fraud and mail fraud, of violating the CAN-SPAM Act, and conspiracy to commit computer fraud. Brown faces up to 63 months in prison and $75,000 fine. William Neil, 46, also of Fresno, California, and James Fite, 36, of Culver City, California, both pleaded guilty in the case. They, along with everyone else involved, will be sentenced on October 29, 2009.

Software Pirate Gets 41 Months in Prison, Loses His Ferrari

Pulkit Chandna — Wed, 18 Feb 2009 08:28:37 -0600

Timothy Kyle Dunaway, a Texas-based software pirate, who had earlier pleaded guilty to one count of criminal copyright violation, has been handed a 41-month jail term by a US District Judge. His clandestine network included 40 websites hosted on servers based in Austria and Malaysia.

He is said to have sold pirated business software through these websites. His activities are estimated to have cost $1 million to software authors.

Not only has he been ordered to pay $810,257 in damages, but the court has also sequestered two of his most cherished belongings, a Ferrari 348 TB and a Rolex watch. After being unnoticed for four prolific years, his business eventually came on the government’s radar screen in May 2008.

Image Credit: Hbuhsd