| U.S. Federal Trade Commission |
FTC News Release, Jul 29, 2004
FTC Sues Florida Man for Illegal Spam and False “Human Growth Hormone” Product Claims
A federal court in Chicago has issued a
court order halting illegal spamming and deceptive product
claims, and has also frozen the assets of Creaghan A. Harry, a
resident of Boca Raton, Florida. Harry sells bogus “human
growth hormone” products over the Internet through spam. The
Federal Trade Commission alleges that Harry is responsible for
what likely amounts to millions of illegal spam messages. From
January 1 through May 31, 2004, consumers have forwarded
approximately 40,000 complaints to the FTC concerning spam
messages linked to Harry.
The text of the illegal spam messages
contain hyperlinks to various Web sites that market Harry’s
products, “Supreme Formula HGH” and “Youthful Vigor HGH.” The
Web sites claim that the products stop or reverse the aging
process, causing a veritable laundry list of effects like
weight loss, muscle gain, hair regrowth, wrinkle removal, and
higher energy levels. Experts for the FTC have concluded that
the claims are wholly false and that Harry’s products had no
discernible effect on the body. Harry charges $79.95 for a
one-month supply of the bogus products. The FTC alleges that
these false product claims have defrauded thousands of
consumers of hundreds of thousands of dollars.
The FTC also asserts that Harry took many
steps to hide his involvement with the bogus product
operation, including using a variety of names, foreign
addresses, anonymous Web sites and spam, and having the
proceeds of the product sales deposited into a bank account in
Latvia. The defendant disguised the source of spam by sending
the messages through “open proxies,” which are vulnerable
computers through which a spammer can route email messages.
Sending the messages through these vulnerable computers
essentially “launders” the emails, making it appear as though
they were sent by the party with the vulnerable computer. The
FTC also alleges that in certain instances, the source of
Harry’s emails was disguised by forging return addresses in
the “reply-to” or “from” fields of his spam - a practice known
as spoofing.
The FTC’s complaint specifically charges
that the deceptive product claims violate the FTC Act, and the
spam email messages violate the Controlling the Assault of
Non-Solicited Pornography and Marketing Act of 2003 (CAN-SPAM
Act) by: 1) disguising their source; 2) failing to provide a
clear and conspicuous notice for consumers to opt-out from
further e-mail; and 3) failing to provide a valid physical
postal address in the message text. On July 27, 2004, a U.S.
District Court Judge issued a temporary restraining order
prohibiting illegal spamming, prohibiting false product
claims, and freezing Harry’s assets to preserve the funds for
possible redress to consumers who bought his bogus
products.
The Commission vote to authorize staff to
file the complaint was 5-0. The complaint was filed in the
U.S. District Court for the District of the Northern District
of Illinois, Eastern Division, on Wednesday, July 21, 2004.
The text in this article was prepared by the U.S. Federal Trade Commission.