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Why you must not do business with spammers

Despite all the technical and legal countermeasures of recent years, the volume of spam continues to grow at an alarming rate. The only reason I can figure for this is that spam must work – there appear to be enough suckers out there who bite on these ads for them to be worthwhile, even with all the hide-and-seek machinations required to distribute them.

This suggests that even as we redouble our efforts on the “supply side” of spam, we must also deal with the “demand side.” Everyone who uses e-mail must be made to understand why trading with spammers is not only risky to themselves, but also contributes to the perpetuation of the nuisance of spam. Only when spam is made unprofitable, as well as difficult and expensive, will it stop clogging our collective inboxes.

And so, here are my reasons for you never never never to do business with spammers. Not that you’d need them, of course, but maybe you know someone else who might (wink).

You may get cheated

If you were to order something from a spammer, what assurance would you have that you’d actually receive it? In most cases, not much. Of course, any web or phone order you place with any merchant bears a risk of not being fulfilled, but at least if you are dealing with a reputable merchant you have some means to complain to them (something you don’t have with the typical spammer).

Even if you do get the goods, are they what you expected? If you ordered a book (and you saw a picture of this book on the website or in the e-mail), did you get what you saw? Or (more likely) did you get a stack of papers in a cheap comb binding (or no binding at all)? Does that Rolex knockoff actually tell time for more than a minute or two between breakdowns? Did that miniature radio-controlled toy car actually work when you gave it to Junior for Christmas?

OK, so the spammer says that he offers a “no-risk money-back guarantee,” but how would this help you if you are unable to contact the seller to make a claim?

Again, if you think you’ve been misled or badly-used by a reputable merchant, that merchant will generally be happy to give you an exchange or a refund. Maybe the spammer will too -- if you can find him, that is.

You might get swindled

Many spams fall into the category of what you might call “investments” — that is, you might call them that, except that investments are customarily supposed to have a real chance of making money for the investor. This can seldom, if ever, be said of these particular rackets.

Chain letters

The chain letter has been around for a long time (I heard it satirized on a radio program from the 1930s), but has blossomed into new life thanks to the internet. First on usenet, and now on e-mail, the clueless chain letter spammers continue to hope that they can find people who are (1) dumber than they are, and (2) have sufficient attention span to put money in the mail to them.

The truth of the matter is this: by the time you get a chain letter, the chances are great that almost everyone else in the galaxy has already seen it, and you won’t stand a chance in hell of making any money from it, no matter how many spams you send out. See my page on chain letters for proof of why they don’t work. Even if they did work, however, they are criminal mail fraud (they are also considered to be a form of illegal gambling by mail). You don’t want the Postal Inspector on your back over a simple five-dollar transaction.

Bogus MLM and pyramid schemes

I’m not here to bash multi-level marketing (MLM). People often snicker about it, but MLM has in fact been quite successful wherever it is organized around a good product and attentive personal service. Successful MLMers can recruit sales help from among friends and customers who like the quality of the products and are willing to put in the time and effort it takes to make sales. It’s not my cup of tea, but if it works for you, have at it.

Spammers’ MLM schemes, however, are a heterochromatic equine (er, that’s “horse of a different color”). They frequently come to you in the form of elaborate shockwave pitches with video clips, animated tree-charts, and the like. They almost never mention a product; it’s as if the product were somehow just a trivial formality amid all the bushels of cash flying around. These varieties of MLM are nothing more than dressed-up chain letters. Once you get rooked by one of these (and we’re not talking five bucks here), you have no alternative but to try to rook others (by using spam) so that you don’t end up holding up the whole pyramid like those unfortunate ancient Egyptian laborers.

Work-at-home schemes

Some scammers send e-mail offering lucrative work-at-home jobs to total strangers. In most cases, these are variations on the time-dishonored “money mule” scam, in which the target is tricked into accepting and cashing bad checks. 

Ever get a pitch to go to work for a “nationally known” (but unidentified) company that promises to pay you thousands per week? You may just have heard from an unfortunate associate of some notorious  “network marketing” outfit, trying desparately to make back his or her initial “investment” by setting his hook in you.

Stock scams

The typical “stock tip” spam is notably different from most other kinds of spam, in that it does not try to sell you anything; in fact, the spammer doesn’t want to hear from you at all. All he wants to do is give you his “information,” in the hopes that you’ll act on it. In each wave of stock spam, you can get more than a dozen identical spams within the course of a week, all touting the same stock; it is to be assumed that all of these are originated by the same parties, which gives you some idea of just how persistent and effective some spammers can be (particularly when they don’t have order-taking websites that can be shut down, or phone numbers and other information by which they could be tracked down).

It’s not unusual to get investment tips from your friends, relatives, colleagues, or your broker; but why on earth would someone give out such information to millions of strangers using spam? Because he hopes to stimulate interest in the stock. Most of these are “penny stocks” that sell for only a few cents a share and are traded only sporadically over-the-counter or on the dreaded “pink sheets.” So, even if only a handful of people show up to buy some shares, this could drive up the price enough for your tipster (or his clients) to sell out at a profit (at which point the share price usually drops right back down to where it was). This sort of thing is known as a “pump and dump,” and is usually quite illegal (check with the U.S. Securities and Exchange Commission).

Pennystock investing is perfectly legal and can be fun and profitable; some people in fact pursue it as a sort of hobby. You would do well, however, to avoid any “tips” given you by an anonymous spammer lest you end up holding the bag.

High-yield investment programs

The high-yield investment program, or “HYIP,” appears to be an internet-age version of the infamous con game practiced by (and named for) Italian immigrant Carlo Ponzi nearly a century ago. In theory, the HYIP offers a way for targets to pay in small amounts of cash (usually via some sort of web-based mechanism), and then realize immediate and substantial returns on their investments. In practice, those high returns come not from dividends or interest or operating profit (as would be the case in a more conventional investment), but from the money paid in by later investors. The early-comers to the HYIP can then tell all their friends and associates what a great program they’ve hooked up with, and can encourage newcomers to join in. Unfortunately, the scheme can continue only for as long as newcomes can be attracted; once the flow of new capital is cut off, the “high yields” come to a screeching halt, and the later investors are left holding the bag.

“Free stuff” marketing programs

These schemes used to be very prominent in click-through web ads, as well as in spam e-mail: the target is offered popular merchandise (e.g., iPods, notebook computers, flat-screen televisions, or maybe just free pizza coupons) “for free,” simply in exchange for “fulfilling our sponsor’s programs.” In this case, “fulfilling a program” means buying (or getting other people to buy) into various kinds of products including credit cards, cell-phone contracts, and the like. Essentially, these programs try to enlist the target to be an uncompensated salesman for the sponsor’s products; the free item will be withheld until the conditions are met, and the target usually has a very limited time in which to complete the program. Some of the more crooked schemes delay or even omit the posting of sales, such that many victims are tricked out of their free stuff altogether.

You risk theft of important personal information

Most merchant websites require you to provide at least your name, address, telephone number, and credit-card number to place an order on the web. Some (like mortgage spammers) may solicit your social-security number, bank account numbers, and other sensitive information. Do you have any assurance that they will take proper care to secure this information from those who shouldn’t have it?

In fact, you really don’t have any such assurance even when dealing with a reputable web merchant, since some of these folks occasionally get busted for not treating their customer info with due care. At least in these cases the investigators know where the company is and whom to contact, which usually isn’t the case with a spammer.

Even if the spammers don’t simply sell your info to criminals, they still may not protect it adequately from theft. They may not secure their websites properly, so that crackers (or even mildly-curious surfers) can find it; this is what happened to a few dozen folks who ordered Pinacle penis pills in one recent and notorious case I discuss on my page on penis enlargement spam.

Believe me, you are not going to like having to deal with changing all your account numbers, resolving fraudulent uses of your credit, and all the other little details that go along with identity theft. It simply isn’t worth getting a couple bucks off a bottle of Vicodin.

You don’t know whom you’re dealing with

Next time you visit the website of a well-known and reputed online merchant (like Amazon or L.L. Bean), notice how you can easily find lots of contact information. You’ll see full postal addresses (and not just post office boxes), telephone numbers (often toll-free), “live chat” boxes, and e-mail addresses (and, those addresses will be within the merchant’s domain, and not alphabet-soup from some free mail service or offshore provider). You may even see the names and faces of corporate officers, and might be given ways to contact them directly.

Now, compare this to the typical spammer’s website; you may not even be able to tell what continent they’re on, let alone find any means to contact them by post or phone. Often, the only reliable means to contact the spammer is via his website order form (and even this could disappear at any time, often by design of the spammer).

So, what will you do if you have to follow up on your order? What if you didn’t get all you ordered, or didn’t get anything at all? Chances are, you will be out of luck. Yes, you can complain to the Better Business Bureau, your local TV-news “consumer watchdog,” or even to your state Attorney General, but given the invisibility of most spammers, these folks are no more likely to be able to help you get action than you could yourself.

You may be dealing with someone you’d rather not be

Maybe that spammer is simply a misguided low-budget entrepreneur who’s using a bit of spam to bootstrap his business. Or, maybe there’s something more sinister in back of that spam.

Some analysts have alleged that known terrorist groups have been involved with spam sales of smuggled cigarettes or counterfeit goods. Organized crime is also alleged to be in back of many spam rackets, like child-porn distribution and online gambling. It’s pretty well known that organized crime groups have funded the development of open-proxy viruses that turn home users’ computers into spam sources, and that they hold and sell access to these spam vectors to other spammers.

Now ask yourself: is being able to buy cheap pirated software or illegally untaxed cigarettes worth putting money into the pockets of organized criminals, or helping fund the next murderous terrorist attack? I think not, and I’m sure you do as well.

You may be exposing yourself to legal action

So, how is it that a spammer can sell a copy of Microsoft Office for fifty bucks when everyone else sells it for four or five times as much? Simple: he steals his inventory. And when he sells a copy to you, you’re receiving stolen merchandise.

When you buy most commercial software, you are paying not for a couple hundred megabytes of assorted data on a plastic disk, but for a license that entitles you to use those data. If you don’t have the license, you don’t have the legal right to use the software. This “license” business is perhaps a fairly new concept to the retail consumer, but has a very long history in industry (where you have to have licenses from an owner in order to make certain products or use certain brand names or logos).

All right, so maybe you are looking at Microsoft’s quarterly statements and you figure they can do without your money, but consider this: without a license, you can’t get factory support for your software (no upgrades, probably no patches either, and certainly no technical support). You also face the very real risk of a lawsuit from the software publishers if they find you’ve been using it illegally (particularly if you use it in a business that has seizable assets or a public profile that would attract corporate lawyers).

Some software spammers may claim to be selling semi-legit “OEM” copies of software, with stripped-down packaging designed to be included with new computers or peripherals (I see these frequently at traveling computer shows). Most, I suspect, are selling “warez,” or purely illegal copies. They are simply giving you a blank disk with the software installation kit copied onto it, maybe with a “crack” or a stolen license code. Altogether, their cost of goods is down around a dollar or two per sale, so even at the bargain price of $50 they are making a colossal profit on every purchase.

Pirated software isn’t the only illegal activity promoted through spam; some “credit repair” scams might involve you in illegal falsifying of your personal information. The so-called Nigerian 419 scams can also get you involved in illegal financial transactions (if indeed the scammers let you get that close to the money) and could even cost you your life.

You could endanger your health

“Cut-price” pharmaceutical drugs are now a mainstay of the spam industry. Each day, I get at least a couple dozen ads offering various name-brand drugs, some of which haven’t yet even gone on sale in the US (thanks to such spam, I actually learned of the impotence drug Cialis long before it reached the TV ads or the drugstores). What the spammers are really selling are risky and possibly completely counterfeit drugs; in offering them to you, they’re inviting you to violate federal law and to risk your health on ineffective or inappropriate medications. Really, do you want to put in your mouth (or inject into your body) something sold by spammers?

The prescription drug spammers are playing off the current common perception that drug companies are rapacious pirates, and that the US FDA is their pantywaist accomplice. Maybe this is true, or maybe not, but here are some points to ponder:

Drug spammers claim that they’ll ship to you with “no questions asked,” or that they’ll give you a “free consultation” with one of their doctors. The latter claim, in particular, is bogus: the American Medical Association, in a gem of understatement, refers to “online” consultations as “substandard medical practice.” How’s that doctor (if indeed there really is such a doctor) going to listen to your chest over the internet? How will he find out about any allergies or chronic conditions you have if you don’t list them on your web form?

I don’t mean to scare you away from buying drugs over the internet; this can be a perfectly safe and convenient practice if you deal with reputable firms recommended by your doctor or your insurance company. You do really need to think very carefullly, however, before you undertake to buy life-saving (or maybe life-threatening) drugs from a spammer.

Other frequently-spammed goods and services

Here’s an odd lot of other oft-spamvertized stuff for you not to buy (nor buy into):



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(c) 2003-2008, Richard C. Conner ( )

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Updated:Sun, 22 Jun 2008

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