The three scammers, Christopher Baith, Cosme Monarrez Jr., and Sorabh Verma waged a deceptive advertising blitz on PlayStation 2 users.
The FTC filed charges that the three men sent out a blast of emails to Sony PlayStation users saying that they had won a sweepstakes contest sponsored by Yahoo. According to the FTC, the emails often had subject headers that stated: "Yahoo Sweepstakes Winner."
The gamers who responded to the bait were hyperlinked to a webpage designed to look identical to a Yahoo web page, even complete with the Yahoo logo and copyright tag.
Consumers were instructed to download a program that would enable them to claim their sweepstakes prize for no charge, according to Reuters. But instead of redeeming their free console, the victim logged on to a $3.99 pay-per-minute porn site that was automatically charged to their telephone bill as a 900 number.
The FTC filed deceptive business charges against the three spammers and forced them to refund up to $25,000 in extorted money.
The FTC claims that consumers were never told that downloading and executing the software would result in added telephone charges. Additionally, the FTC contends, the promise of a PlayStation 2 console was false and deceptive.
The FTC ordered Christopher Baith to pay a $10,000 fine, although due to financial hardship, Baith will be permitted to only pay a quarter of the imposed fine.
According to Reuters, the FTC will also monitor all three scammer's future business endeavors.
The FTC settlement permanently bars the defendants from sending any email that misrepresents the identity of the sender or the subject of the email.
The FTC also fined the company that created the modem dialer software, BTV Industries, alleging that its technology violated the FTC’s '900-Number Rule' by failing to disclose to consumers using their software that they would be connected to the Internet through a 900-number.