FTC Targets X-Rated Spam

Seven affiliate marketing companies pay penalties or reach settlements over noncompliant e-mailing of pornography.

The Federal Trade Commission has charged seven companies with violating federal laws that require labels on e-mail containing sexually explicit content.

Suits filed in U.S. District Court Wednesday seek civil penalties against TJ Web Productions, Cyberheat Inc. and Impulse Media. The other four companies involved in the enforcement action settled with the commission, for a total of $1.15 million.

The companies operated affiliate marketing programs that sent e-mail on behalf of others in the adult entertainment industry. The FTC charged the marketers under the CAN-SPAM Acts Adult Labeling Rule, claiming that the firms violated that rule by not providing clear and conspicuous opt-out mechanisms, or a postal address. They also did not use the phrase "Sexually Explicit" in the subject line, as mandated by the rule.

"We announced in April that we would be going after people under the rule, and started investigating violations in May," said Jonathan Kraden, FTC staff attorney. "We want to make it very clear that were going to enforce this rule as aggressively as we can."

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Many consumer watchdog groups applaud the FTCs effort, calling it a welcome dose of enforcement for CAN-SPAM. The use of the Act to track down and punish spammers has been lacking in the past, many believe.

"Im thrilled that the FTC is starting to take action," said Parry Aftab, executive director of WiredSafety.org, which has Wired Kids as part of its network. "The FTC has been very diligent at protecting children, as well as Internet users of all ages, and its good to see that theyre now doing enforcement."

Despite supporting the lawsuits, however, Aftab expressed concern that such enforcement tactics will ultimately prove futile in the face of so much spam, and considering the wily strategies employed by spammers.

"Theyre smarter than all of us," said Aftab. "And theyre slimier than any of us can handle."

One change that Aftab says could reduce pornographic spam being seen by children lies in the recent adoption of an ".xxx" domain name, which will separate porn purveyors and their customers from the rest of the surfing public.

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Those who wish to have a .xxx domain name must sign an agreement promising that they have implemented effective controls that will block children from accessing their sites. The creation of an adult entertainment area of the Web could draw some pornographic spammers away from sending messages to a mainstream audience, said Aftab.

Also of concern in the spam watchdog community is the amount of resources available to the FTC. "They just dont have the manpower to go after spammers to the degree that everyone would like them to," said John Mozena, co-founder of the Coalition Against Unsolicited Commercial Email (CAUCE). "Congress gave them the power to do investigations and enforcement, but not the resources."

However, Kraden expressed confidence that the recent enforcement action will have an effect on x-rated spam, since it targets affiliate marketing companies rather than those creating the messages.

"We think this top-down approach will bring the industry into compliance," he said. "They know were serious now."

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