Internet News

FTC Busts 'World's Largest Spam Operation'
Group e-mailed promotions for prescription drugs, 'male enhancement' pills

E-mail inboxes may be clogged with a little less spam — at least for a while. Authorities said this week they have shut down one of the largest spam operations in the world, a vast network involving countries from New Zealand to China and the United States.

The spammers sent out billions of e-mails in recent years encouraging people to click through to web sites that allegedly used false claims to peddle prescription drugs, as well as "male enhancement" and weight-loss pills. The Federal Trade Commission received more than 3 million complaints about the spam and related Web sites, illustrating the scale of the operation, officials said.

The sites, including one called "Canadian Healthcare," were difficult to distinguish from legitimate online pharmacies — making the pitches more persuasive, said Steve Baker, the FTC's Midwest Region director:

"These sites are really professionally constructed," he said. "Some years ago you used to be able to tell the bogus things because they looked cheesy and had misspellings. Anymore, I don't think that's true."

The operation violated the federal CAN-SPAM Act of 2003, meant to restrict commercial spam, by using false header information to hide the origin of messages, not offering an opt-out link and failing to list a postal address, the FTC said. As part of their inquiry, FTC staff made undercover purchases from the sites. No one asked the clandestine buyers to provide verification of a prescription and the shipped drugs did not include doctors' instructions or dosage information, officials said.

A federal judge in Chicago issued a temporary injunction to halt the operation and also froze its assets. The Federal Bureau of Investigation is investigating and those involved could also face criminal charges, Baker said.

Those spearheading the enterprise, known as "Affking" on the Internet, included a U.S. and a New Zealand citizen, according to court documents.

FTC Warns Of Increase In Internet Scams

Commission says scammers taking advantage of woes in financial markets

E-mail scams that "phish" for personal information may increase amid the current financial crisis, the Federal Trade Commission warned consumers this week.

Separately, the Federal Deposit Insurance Corporation said it has received numerous reports of a fraudulent e-mail that appears to be from the government agency. Its subject line reads, "Funds wired into your account are stolen."

"Scammers are taking advantage of upheavals in the financial marketplace to confuse consumers into parting with valuable personal information," the FTC said in an advisory note on its Web site.

Phishers send e-mails disguised as being from an official institution, such as a bank or mortgage company. The agency said consumers should take extra caution in responding to any e-mails that look as if they are from financial institutions because of the increased likelihood of scams.

"These messages may be from 'phishers' looking to use personal information — account numbers, passwords, Social Security numbers — to run up bills or commit other crimes in a consumer's name," the FTC said.

That, according to the FDIC, is what the e-mail that appears to be sent from its offices attempts to do.

"Recipients should consider the intent of the executable file as a malicious attempt to collect personal or confidential information, some of which may be used to gain unauthorized access to online banking services or to conduct identity theft," FDIC said in a statement on its Web site.

Almost no banks or financial institutions request that type of information from their customers.

The FTC issued a guide to help consumers "stay on guard" against these types of scams. It can be read on the Web at: http://www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt089.shtm

Fake YouTube Pages Used To Spread Viruses

Hoax prompts users to install new software before viewing their video

Savvy Internet users know that downloading unsolicited computer programs is one of the most dangerous things you can do online. It puts you at great risk for a virus or another time bomb from a hacker.

But even some sophisticated surfers could get taken in by a sneaky new attack in which criminals create fake YouTube pages — dead-on replicas of the real site — to push their malicious software and make it look like it's safe stuff coming from a trusted source.

A program circulating online helps hackers build those fake pages. Users who follow an e-mail pointing them to one of the pages would see an error message that claims the video they want won't play without installing new software first. That error message includes a link the hacker has provided to a malicious program, which delivers a virus.

Even worse: once the computer is infected, it's simple for the hacker to silently redirect the victims to a real YouTube page to see videos they were hoping to see — and hide the crime.

"It's spot-on accurate, and that is scary," said Jamz Yaneza, threat research manager for security software company Trend Micro Inc. "If I were watching YouTube videos all day I would probably click on this one."

The tactic itself isn't new: There's a constant push by criminals to build more convincing spoofs of legitimate sites to trick people into downloading harmful software. And the latest attacks don't target any vulnerability in the YouTube site. But it highlights the fact that criminals are getting better at creating bogus sites and developing so-called "social engineering" methods to fool people.

Fortunately, truly alert Internet users can still see the telltale warning signs with the fake YouTube pages. For one, the Web browser won't show the real YouTube's Internet address. And to even see the malicious page, you have to first follow a link that's sent to you, which is often a tip-off that you should independently verify whether the site is legitimate.

Wall Street Journal Launches Social Network

Web site borrows from Internet hangouts like Facebook and Myspace to boost usage

The Wall Street Journal is borrowing elements from popular Internet hangouts like Facebook as it seeks to boost usage. WSJ.com, one of the few news sites to restrict many of its stories to paying subscribers, is changing its layout to help nonpaying visitors navigate and identify free, ad-supported content. Those visitors will see a different home page from users who sign in as subscribers.

The new "Journal Community" is coming this week as part of the site's first major revision since 2002. There, paying subscribers create personal profile pages with their real names, job details, interests and photo, much as users can at Facebook and the professional-networking site LinkedIn.

Community members will be able to comment on individual stories, create discussion groups on specific topics and ask one another for advice on such topics as starting small businesses or finding a place to take clients during a business trip, say, in Prague.

The Journal's online audience has been growing fast, and nonpaying visitors make up the lion's share. WSJ.com has 4.7 million visitors in July, nearly twice July 2007's total of 2.4 million, according to comScore Inc. Only about 5 percent of the site's users are paying subscribers, the Journal said.

By embracing social-networking tools popular elsewhere, the Journal hopes to draw even more people to its site more often for longer stays. Alan Murray, a deputy managing editor who oversees the site's editorial operations, said the Journal can offer an unmatched community of well-heeled business executives.

"There's no technology here that you can't get at other places," Murray said. "What we have that you can't get anywhere else is the Journal community, the Journal subscriber base."

Although news organizations have started to embrace blogs and tools to share and view content, they have lagged behind companies that originated on the Internet, including Facebook and MySpace, which was bought by the Journal's owner, News Corp., after the social-networking service rocketed in popularity.

Some examples of newspapers jumping into social networking include The Bakersfield Californian, which lets visitors create profiles, blogs and networks of friends, and The New York Times, which is testing TimesPeople for readers to see what their friends are reading and recommending. Journal sister site MarketWatch.com also allows visitors to designate friends and tag stories with keywords for easier discovery.

"But in general, it's still the same old story, where the newspaper industry has gone slowly in this interactivity thing," said Steve Outing, a columnist with Editor and Publisher magazine. "They are making some strides, but overall it's pretty slow going."

Although news sites shouldn't try to duplicate what social networks already do well, Outing said, they risk losing users' attention if they don't get more aggressive about embracing the latest tools.

The Journal is trying to do just that.

Besides adding the networking function, it's looking for ways to merge its community with those elsewhere. And Facebook and MySpace, among others, are developing tools to make that possible.

"We believe that in the future, social networks are going to be an important means of distributing content and of spreading news, and we want to be a part of those networks," Murray said.

WSJ.com hopes to increase the quality of discussions by insisting that users post over their real names — as verified against billing and subscription information. Other social networks that ask for real names don't have good ways to verify them, and news sites that allow pseudonyms have found discussions often degenerate into vicious personal attacks.

Subscribers can search for and contact others, but they won't be able to declare anyone a top friend, as they can on other sites. Nor are the Journal's personal profiles meant to include for party photos, games or music.

The Journal plans to eventually open the social-networking features to nonpaying visitors, though they will need to figure out how to verify identities.

The separate home page for nonpaying visitors will emphasize the free content. Off-limit items will be marked with a small icon of a key. That's partly to minimize user frustration — before visitors had to click first, only to find the item unavailable. More importantly, the icon will show users what they are missing and encourage them to start paying.

The site is being structured to make it easier for search engines to direct traffic to individual stories, and once there, a new tabbed layout will help readers find related video, photos, reader comments and other articles. The new design will also let the Journal try out new ad formats.

The mix of free and for-pay content isn't changing, though the Journal says it is expanding its coverage areas in the coming months and will generally make those articles free.

Facebook Gets Another Facelift

100 million users must adapt to redesigned site, whether they like it or not

Since he started Facebook in college 4 1/2 years ago, Mark Zuckerberg has learned — sometimes painfully — that he can't make significant changes to the popular online hangout without triggering an uproar among indignant users who preferred the status quo. But Zuckerberg, still only 24, is hoping he has found a way to ease the journey down a different road so he won't have to issue public apologies like he did in each of the previous two years after springing new products on users.

His theory will face a major test Wednesday when Facebook begins forcing its 100 million users to adapt to a redesigned Web site, whether they like the new look or not. Since unveiling the makeover seven weeks ago, Facebook had left it up to users to decide whether they wanted to switch over. If they didn't like what they saw, the converts could just click on a link to switch back to the old format.

But that option will be taken away from all users by the end of the week, a shift that Zuckerberg already knows will alienate some of Facebook's audience and raise the risk of driving more traffic to rival social networks like MySpace and Bebo.

"Any change can be a big deal to our users because this is how they connect with their family and friends," Zuckerberg said. "So when you move things around, it can be perceived as being not a positive thing even when it's a positive change."

About 40 million users already have checked out the new design and about 30 million embraced it without reverting to the old look, Zuckerberg said. But the seeds of an uprising already have been planted on Facebook's own site, where several groups and petitions have cropped up to protest the change. Facebook's facelift separates users' personal profiles into different areas of the site and provides more tools that are meant to make it easier to share information and photos.

The revisions also shift various applications to the bottom of a person's home page and clears up more white space — a move that Sanders worries will lead to more intrusive advertising on the site, although Zuckerberg says that won't happen. Hoping to minimize the sting of the anticipated backlash, Facebook announced the planned makeover in May and then waited until July to take the wraps off. The transition period since then was aimed at giving users time to make suggestions and get used to the change.

The gradual approach differed from how Zuckerberg and the rest of Facebook's unusually young management team have managed past revisions to the site.

In 2006, the Palo Alto-based startup infuriated thousands of users by introducing a tool called "news feeds" that automatically broadcast certain personal details. Last year, Facebook faced another revolt when it rolled out a tracking device, dubbed "Beacon," that tracked and shared information about users' shopping habits and other activities at other Web sites.

In both instances, Zuckerberg wound up apologizing for going too far and placated the protesters by giving more control over news feeds and Beacon. News feeds are now considered indispensable by many users, but Beacon still hasn't gained traction.

With Facebook's audience now roughly 10 times larger than when news feeds first came out two years ago, Zuckerberg understood he needed to do a better job preparing for changes.

Web Site Invites Kids To Report Bullies Incognito

Utah schools hope to combat 'snitch' label that leads to silent suffering

Six Utah schools have introduced a Web site that allows students to anonymously report bullies. A Brigham Young University student, Justin Bergener, created the site, which also lets students post information about thefts, drugs and harassment. Bergener said he hopes students who might otherwise be too scared or shy to speak up will be willing to post on the site.

"There really is this culture and code of silence that's particularly prevalent in middle schools and high schools," Bergener said.

Nearly 50 schools in other states are also using the Web site.

Here's how it works: School administrators are made aware of any tips either by e-mail or text message, Bergener said. For some schools, students have to create a logon and password to send a tip, but they still remain anonymous, though. But in most cases, schools allow anyone to send a tip with no need to give personal information.

Bergener said his Web site is simply a third party that ships the tips along. SchoolTipline, which also has participating schools in Texas, Washington, California and Arizona, doesn't read the tips or reply to them. If a tip goes unread for a day or so, though, SchoolTipline reminds schools it's there.

Walter

Sources: Wall Street Journal, Federal Trade Commission, FDIC, Facebook, Trend Micro, SchoolTipline.com, Associated Press Wire Service.