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Congress May Outlaw Spyware

Illicit Software Invades Consumers' Privacy, House Committee is Told

By Joseph S. Enoch
ConsumerAffairs.com Congressional Correspondent

April 19, 2007

• Washington Sues Alleged Spyware Spammer • FixWinReg Settles Washington Spyware Charges • Privasafe, SurfSafe Settle Washington Charges • House Passes New Anti-Spyware Bill • Congress May Outlaw Spyware • Washington State Hits Secure Computer with $1 Million Penalty • Spyware Spammer Fined in Washington State • Feds Quash "Search Miracle" Spyware • Court Halts Spyware Operations • Yahoo Implicated in Spyware "Click Fraud" • New York Sues Major Spyware Distributor • Two Anti-Spyware Promoters Settle FTC Charges • Washington, Microsoft Pursue Alleged Spyware Scammers • Fear of Spyware Plagues Millions • New York Sues InterMix • NY Nails Intermix CEO On Spyware Charges • Harvard, Oxford Team Up To Squash Spyware

Everyday ConsumerAffairs.com receives complaints from consumers who have been the victims of malicious spyware -- software that secretly collects data and shares it with companies and advertisers who use that data to berate consumers with popups and occasionally steals identities.

But a bill making its way through the House would potentially make the more harmful forms of spyware illegal.

The House Subcommittee on Commerce Trade and Consumer Protection passed the Spy Act by a voice vote today in its first bill markup of the 110th Congress.

"As technology advances, it is imperative that the government remain aware and ahead of potentially damaging uses of that technology. Protecting Internet users from dangerous programs that steal consumers' identities, invade their software or just plain harass them is a top priority," Rep. John D. Dingell (D-Mich.), Chairman of the Committee on Energy and Commerce said in a prepared statement.

Many consumers who fall victim to spyware receive random popups -- even when they are not browsing the Internet -- and in severe cases the spyware begins billing the individual.

"Movieland (a spyware company) put popups on my computer and I paid to have it removed," wrote Randy of Weston, W.Va. "Now they are illegally taking funds from my checking account."

If the Spy Act becomes law, it will shield consumers from software that works under-the-radar to monitor user activities and occasionally steal their identity.

Spyware is not always illegal. Many major companies use a benign version of spyware called "adware" to follow consumers around the Internet, attempting to serve ads -- all ads, not just pop-ups -- that appear to match their interests. These programs do not gather any personal information and do not take control of the user's computer.

Advertising executives and publishers defend the practice, saying it is no different from placing billboards in spots where they are most likely to reach the target audience.

The Spy Act would require companies to be more forthcoming with the terms of their spyware. It would require software distributors and advertisers to clearly notify and require consent from consumers of the programs and applications they download from the Internet.

Offenders could be fined up to $3 million for each unfair or deceptive spyware act or practice and up to $1 million for each violation regarding the collection of personal information without notice and consent.

Some of ConsumerAffairs.com's most notorious spyware companies include: Movieland.com, Moviepass.tv and Popcorn.net.

The bill will go before the full committee later.

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