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    FTC Settles with HP Private Eyes

    By
    Roy Mark
    -
    May 29, 2008
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      The private investigators involved in Hewlett-Packard’s 2005 infamous boardroom leaks case agreed May 28 to $600,000 in settlements and judgments for their role in obtaining the confidential phone records of journalists and HP employees. Two key players in the scandal, though, will pay only $3,000.

      The Federal Trade Commission imposed a $67,000 fine on Matthew and Joseph Depante and their company, Action Research Group, for using illegal “pretexting” practices to obtain the phone logs. The FTC suspended all but $3,000 of the fine since Action Research Group is now out of business and the Depantes are unable to pay.

      The Depantes’ subcontractors for the HP job were hit with more than $500,000 in default judgments. Bryan Wagner faces a $428,085 judgment and Cassandra Selvage of Eye in the Sky Investigators must pay $110,762.

      HP hired the Depantes in 2005 to investigate a series of boardroom leaks about the company’s internal business plans. The investigators obtained the phone records by using false pretenses, including posing as an account holder or as an employee of a phone company.

      According to the FTC complaint, the Telecommunications Act of 1996 provides that a customer’s phone records may only be disclosed “upon affirmative written request by the customer.” In addition to the judgments, the Depantes, Wagner and Selvage are barred from obtaining consumers’ telephone records without their consent.

      The judgments against the HP pretexters is the latest in a series of FTC cases targeting individuals and companies that illegally obtain phone records and sell them to third parties. To date, the FTC has charged 16 individuals and their corporations with violating federal pretexting laws.

      Former HP Chairman Patty Dunn, who lost her job over the scandal, faced California criminal charges for her role in ordering the investigation, but all charges were eventually dismissed.

      Avatar
      Roy Mark

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