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02 May 2012
This morning I was in federal court in Philadelphia before Judge Stewart R. Dalzell for what is probably the last chapter of the Sili Neutraceuticals story. Brian McDaid was a chiropractor who ran an affiliate spam scheme in 2005-2006 for Hoodia and other weight loss nostrums.
In 2007, the FTC charged him with claiming that Hoodia caused rapid weight loss and other falsehoods about the stuff he was selling. They got a huge judgement against him and confiscated all of his assets.
But not only was the stuff he was selling bogus, he was using affiliates he found on the Bulkbarn web site to advertise, and to nobody's surprise (except, perhaps, his) the affiliates spammed like crazy. To accept the orders from the affiliates he registered large numbers of domain names for web sites hosted on bullet-proof servers overseas. He was indicted by a Philadelphia grand jury on criminal CAN SPAM charges in March 2011, and subsequently pled guilty.
Today was the sentencing hearing. McDaid's lawyer had claimed in the sentencing brief that (more or less) spam is a victimless crime because it's all filtered out, and in this case McDaid had provided refunds to anyone who ordered and wanted their money back.
At the government's request, I testfied as a technical expert on spam, explaining that 90% or more of all e-mail is spam, which places a technical and personnel burden on mail system operators, as well as wasting the time of recipients. McDaid's lawyer tried to argue that some spam is CAN SPAM compliant. I said that yes, a little bit is, but I'd be surprised if it's more than 1% or 2%, and the vast majority of spam is illegal. The judge, who like most Federal judges was clearly very smart but not a technical expert, asked a few questions, and mentioned the spam he got in his own inbox, which was not a good omen for the defendant.
The government recommended that the judge sentence McDaid to three or four years in jail, although their memorandum noted that under the sentencing guidelines they could have asked for nine years. The defense said that since there was no chance of him doing it again, and he had no assets, the FTC having taken them all, that probation or home detention would be adequate. Many of McDaid's family and friends were in the courtroom, and had submitted statements in his support. His son and daughter spoke briefly, saying (quite credibly) that he was a great father and they'd be devastated to lose him. The judge invited McDaid to speak, and he said a few sentences about how sorry he was and what a mistake he'd made.
Then Judge Dalzell said that this was a situation where everyone who'd testified was right, and that although he agreed that McDaid had no criminal history and was unlikely to reoffend, given the seriousness of the charges, he sentenced McDaid to two years in jail and a year of probation.
Although I think the sentence was appropriate, and will certainly send a message to other people considering a similar career in criminal affiliate spamming, it was not a pleasant experience to see someone who'd ruined his life. I would greatly prefer that rather than put more people in jail, spammers would get the message and stop so we don't have to. But I'm not holding my breath.
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