The breach, according to Attorney General Eliot Spitzer, may be the largest ever on the Internet.
Instead of confidentiality, Gratis allegedly sold email addresses and accompanying information to three independent marketers, and hundreds of millions of email solicitations followed.
Spitzer said consumers thought they were simply registering to see a website offering free iPods, DVDs, video games and even plasma TVs. And on its FreePay signup pages, Gratis promised it "does not ... sell/rent e-mails."
Gratis wrongfully shared as many as 7 million "user records," Spitzer said, creating the largest deliberate breach of a privacy policy discovered by law enforcement in the U.S.
Spitzer said Gratis’ promises to consumers included: "We will never give out, sell or lend your name or information to anyone."
Washington-based Gratis, owned by Peter Martin and Robert Jewell, offers lucrative dividends for affiliate sites. “We have the resources necessary to help our top publishers earn over $200,000 a month,” according to its website.
Calls to Jewell and Martin weren’t immediately returned to XBiz Thursday morning.