Spam king gets 51 months

Jake Widman
Wednesday, 25 November 2009 02:05

Business IT - Security

Alan Ralsky, a longtime spammer who has boasted about how much money spam made him, has been sentenced to 51 months in prison for his role in a stock "pump-and-dump" scheme.

Ralsky has been an unrepentant spammer since at least 1997, when spam trackers Spamhaus first started following his activities.

In 2002, he gave an interview with his hometown paper, the Detroit Free Press, in which he boasted about how much money he'd made from his spamming activities. At some point, he started calling himself the "Godfather of Spam."

But in 2005 he attracted the attention of the FBI for working with others to send out spam promoting lightly traded stocks, mostly Chinese penny stocks. Ralsky and his co-conspirators would have bought the stock before sending out the e-mails; after their spam had convinced some people to buy the stock, boosting its price, they would sell their holdings.

"The spam e-mails contained materially false and misleading information or omissions and were created and sent using software programs that made it difficult to trace them back to the conspirators," according to the U.S. Department of Justice announcement .

Ralsky was indicted for the scheme in December 2007 and pled guilty in June 2009.

In addition to the 51-month sentence, Ralsky forfeited US$250,000 that the government had seized at the time of the indictment. He will also be subject to five years of "supervised release" after his prison sentence.

Others sentenced include Scott Bradley, Ralsky's son-in-law and director of the spam operation, who got 40 months in prison; How Wai John Hui, a resident of Hong Kong, got 51 months for representing the companies whose stocks were involved; and John S. Brown, who got 32 months for being the spammers' technology officer.

Five other members of the conspiracy pled guilty and are still awaiting sentencing.