On Tuesday, I reported about how the Spam King lived large. Well, if U.S. Attorney Stephen Murphy has his way, he will be doing it from a small room. (I believe the Genie from Disney's Aladdin said, "Phenomenal Cosmic Power! Itty-bitty living space.")
Alan Ralsky and ten others were charged with trying to inflate prices for Chinese penny stocks via email spam. According to the 41-count federal grand jury Indictment, the defendants then sold the stocks at inflated prices and then used a variety of illegal methods "that evaded spam-blocking devices and tricked recipients into opening, and acting on, advertisements in the spam," Murphy said in a news release. These included using falsified "headers" in the email messages, using proxy computers to relay the spam, using falsely registered domain names to send the spam, as well as making misrepresentations in the advertising content of some of the underlying email messages.
The indictment also alleges that the defendants tried to send their spam by utilizing a cybercrime tool known as a "botnet," which is a network of "robot" computers that have been infected with malicious software code that in turn would instruct the infected computers to send spam. The indictment charges that the defendants earned profits when recipients responded to the spam and purchased the touted products and services. According to the indictment, Hui’s primary role in the scheme was to act as a conduit for Chinese companies who wanted their stocks pumped by the scheme. Ultimately, investigators estimate that the Ralsky defendants earned approximately $3 million during the summer of 2005 alone as a result of their illegal spamming activities.
I find it interesting that Ralsky was caught by stock manipulation rather than any anti-spam act. It reminds me of Al Capone being caught for income tax evasion rather than for bank robbery or anything else.
"Today's charges seek to knock out one of the largest illegal spamming and fraud operations in the country, an international scheme to make money by manipulating stock prices through illegal spam e-mail promotions," said Murphy.
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