E-mail Scammer Gets Stiffest-Ever Penalty for Online Fraud | AccountingWEB

E-mail Scammer Gets Stiffest-Ever Penalty for Online Fraud

A Houston man who fooled e-mail recipients into turning over 473 credit card numbers was sentenced Tuesday to almost four years in jail, one of the toughest penalties ever handed down for online fraud.

U.S. District Court Judge Vanessa Gilmore in Houston gave Zachary Hill, 20, "one of, if not the longest-ever" sentences against an e-mail scammer, Justice Department spokesman Michael Kulstad told the Washington Post.

Hill used a so-called "phishing" scheme to make his e-mail look like it came from Internet service provider America Online or PayPal, which eBay uses for online payments. The e-mail message told recipients that their accounts had lapsed and to send in their credit card numbers to restart them. The victims filled out Web forms that appeared to be pages created by the companies. Hill then used the used the credit card numbers to buy $47,000 in goods and services.

"I think phishing is one of the most serious and offensive of the frauds we see out there in the spam world. This is outright theft. I think this should send a strong message to people who want to steal from consumers that they can do some serious time for it," said Howard Beales, the director of the Bureau of Consumer protection at the Federal Trade Commission (FTC).

Beales said the Hill case is part of a bigger effort by federal regulators to fight computer crimes, such as e-mail scams. Phishing, which can fool even the most sophisticated computer users, is just one target of the regulators’ collaborative efforts.

Beales said consumers should never click on links in e-mails advising them about their account status at various websites. Type in the Internet address manually and go to the proper website to ask questions, he said.

Hill was not charged under the federal anti-spam law that went into effect in January. He was charged under a federal fraud statute and pleaded guilty in February.

Sen. Conrad Burns (R-Mont.), who co-authored the Can-Spam legislation, cheered the tough sentence.

"I have said from the beginning that enforcement is key. We need movement from all angles of this issue to really make a dent in the amounts of spam out there," Burns said. "With the action we have seen in the past few months, and today's announcement, we are sending a clear message to spammers that the work they do is out of bounds."

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