Money Matters, Simplified.
“Godfather of Spam” Gets 4 Years Behind Bars
Alan Ralsky, nicknamed the “Godfather of Spam” by the feds, was sentenced to four years in prison in Detroit by a federal judge on Monday for playing a lead role in an e-mail stock fraud and spamming scheme.
by Priyanka - November 25, 2009 - comments
According to the U.S. Department of Justice, Ralsky mostly sent spam for the U.S.-based companies. These spam emails contained false information and were sent from proxy computers.
Judge Battani also sentenced three other people involved in the scam with Ralsky to do prison time ranging from 32 to 51 months; it also included his son-in-law, Scott Bradley, 48.
They together headed an illegal spamming plot, created to increase stock prices and profits artificially, by trading in stocks whose share prices inflated.
Ralsky also faces five years of probation and fine of $250,000 for conspiring to commit mail fraud, wire fraud, and violating the CAN-SPAM Act.
Court sending a strong message to all those involved in such frauds
Federal courts message sends a clear message to all those who indulge in such illegal acts; that the court takes these acts very seriously and can prosecute the perpetrators of such cyber crimes.
"Today's sentencing sends a powerful message to spammers whose goal is to manipulate financial transactions and the stock market through illegal e-mail advertisements," said Assistant Attorney General Lanny Breuer, in a statement. "People who use fraudulent e-mails to drive up stock prices and reap illicit profits will be prosecuted, and they will face significant prison time."
Ralsky’s son-in-law Bradley was also sentenced to more than three years in proson, with a five-year supervised probation period, just like Ralsky.
Another conspirator, How Wai John Hui of Hong Kong, was sentenced to 51 months in prison and John Brown of California received 32 months sentence for being involved in the spam scheme.
Hui was charge with wire and mail fraud, while Brown was charged for running the botnet to send spam.
On Wednesday, five other members of this scam are also expected to be sentenced.
Fraud came to light through Microsoft
Microsoft Internet Safety Enforcement Team first came to know about Ralsky’s network in 2004. The company documented the evidence of spam emails and botnets that were used to manipulate the prices of the stocks.
Microsoft then handed over the evidence it collected over to the Department of Justice and also supported three-year investigation that followed, led by the FBI with assistance from the Internal Revenue Service Criminal Investigation Division and the U.S. Postal Inspection Service to nab the culprits.
Microsoft’s Internet Safety Enforcement Team has been involved in investigating these kinds of spam attacks for years now, because of the fact that mostly these spammers target their customers or execute their plans on Microsoft’s name.
FBI Special Agent in Charge Andrew G. Arena, said in a statement, "Through this conspiracy Ralsky and the others were able to manipulate the stock market and maximize their profit. They flooded our e-mail boxes with unwanted spam e-mail and attempted to use a botnet to hijack our computers assist them in the scheme.
“Cyber crime investigations are a top priority of the FBI and we will continue to aggressively investigate those individuals who use and hide behind computers to commit various crimes.”