Infamous Spammer Arrested, Faces New Charges

Jun 01, 05:00 AM

Current Headlines: By Byron Acohido

SEATTLE -- The arrest of notorious spammer Robert Alan Soloway, 27, on criminal charges for continuing to spread junk e-mail raised cheers in the tech security community.

But Soloway's arrest Wednesday in Seattle won't slow down the tidal wave of spam. Unwanted commercial e-mail has become big business, backed by organized crime. Most of it originates from networks of compromised home PCs, called zombies.

The spam deluge includes record levels of unsolicited e-mail ads for subprime loans, herbal remedies and get-rich-quick schemes. It includes phishing mail that lures recipients into typing sensitive data on bogus websites. There's also "pharm" spam pitching fake pharmaceutical drugs. And stock spam dupes recipients into helping drive up prices of moribund stocks.

"This is the modern face of the e-mail threat," says Adam O'Donnell, director of emerging technology at message security firm Cloudmark. "Spam makes money."

Soloway pleaded not guilty and is being held in federal detention, pending a hearing next week. In his heyday from 2003 to 2005, Soloway made millions selling crude spamming kits to newbie spammers, and provided access to zombie networks to help his customers accelerate spamming.

Those activities came to light in a 2005 civil judgment Microsoft won against Soloway. He was ordered to pay the software giant $7.8 million. Microsoft spokeswoman Liz Candello says he never paid.

Last week, a federal grand jury returned a 35-count indictment against Soloway charging him with mail fraud, wire fraud, e-mail fraud, aggravated identity theft and money laundering. He has been living in a ritzy apartment and drives an expensive Mercedes convertible, says prosecutor Kathryn Warma. Prosecutors want him to forfeit $773,000 they say he made from his business, Newport Internet Marketing.

Yet he appears to have been a bit player in a spamming world that has exploded in the past two years, says Patrick Peterson, vice president of technology at messaging security firm IronPort Systems. In a 24-hour period this week, IronPort blocked 81 billion spam messages. Spam volume has nearly doubled to an average 70 billion per day vs. 36 billion in May 2006.

"Soloway is a notable actor," says Peterson. "But he's not one of the supercriminals who is responsible for most of the mayhem that's going on today."

MessageLabs last week reported another advance: For the first time, the London-based security firm intercepted spam pitching stock purchases with an enticement to click to a tainted Web page. Clicking on the link turned over control of the PC to the intruder.

"It shows how far they're come," says Matt Sergeant, senior anti-spam technologist at MessageLabs. Well-funded, organized crime groups are "just absolutely out in the open trying to get you to install this stuff."

Soloway, by comparison, was a small-timer. According to the indictment, clients paid him $495 to have him send e-mail to 20 million addresses for 15 days or sell them 80,000 e-mail addresses. (c) Copyright 2005 USA TODAY, a division of Gannett Co. Inc.