Epic Hires Cyber Fraud Inspectors to Burnish Image

Florida investigator Jonathan Gillman inspected AzoogleAds before the firm agreed to pay the state $1 million last year. Today the former Florida Attorney General’s Office Financial Investigator can survey the performance marketing company — recently renamed Epic Advertising –from the inside.

In its ongoing efforts to police itself, and apply a little peer pressure to the rest of the performance marketing sector, Epic has hired two staffers from state AG Offices. Gillman started April 14 as manager, regulatory affairs, while previous New York AG Office Internet Bureau Law Clerk Anwesa Paul will begin her role as privacy officer and associate general counsel for Epic soon. Both will report to Epic General Counsel David Graff.

Gillman and Paul have a history of dealing with investigations into cyber fraud activities such as spyware and phishing. Most recently, Paul was compliance manager for the Entertainment Software Rating Board.

“We’re in an industry which refuses to self-regulate, from our perspective, and we’re doing everything we can to put pressure on them,” said Epic President Don Mathis. According to Mathis, not only do the performance marketing and lead generation sectors need more self-regulation, but the online ad industry as a whole.

“There are a lot of people who are involved in this ecosystem,” said Michael Sprouse, CMO of Epic. “There’s not a company in the performance sector or the entire Internet ad industry that doesn’t claim to have top flight compliance,” he continued, implying they aren’t all angels.

Despite Epic’s apparent dedication to swabbing the industry decks, some marketers might find it tough to stomach admonishment from a firm investigated for unfair and deceptive trade practices. The company agreed in November 2007 to pay the Sunshine State $1 million after its CyberFraud Task Force claimed Epic, then AzoogleAds, duped online consumers into paying for mobile ringtones advertised as “free” in Web ads.

The agreement with Florida requires the firm to include details about the actual cost of mobile content offers prominently in ads and near registration forms. “That sets a precedent for what everybody in the industry ought to be doing,” Mathis said.

After starting in Epic’s New York office two weeks ago, Gillman instituted a review of all ad creative running through the system. “I’m responsible for the compliance of all the offers here that are running on our network,” he explained.

Epic execs will not admit to any wrongdoing in relation to the Florida investigation. Indeed, the company blames bad behavior on publishers in its network it claims were “marketing aggressively” by misleading consumers about mobile content offers.

Since settling with Florida, the company has tried to put its best face forward, assisting the AG’s Office in further online ad fraud investigations, and attempting to work with industry groups to establish best practices for ads pushing ringtones and other mobile content. The company hopes the presence of its new Internet Compliance Group members helps convince the likes of Truste and the Mobile Marketing Association that its aim is true.

Epic hopes to work with such organizations to lead development of a “code of conduct” for the mobile performance marketing sector. “The second way is to kind of take this crusade, if you will, out into the public,” said Mathis.

Whether Gillman lends Epic gravitas in its mission to clean up aspects of online marketing remains to be seen. Because of his reputation and credentials, suggested Sprouse, “He’s to be taken seriously, and it gives us the advantage of talking to larger audiences.”

The Florida AG’s Office Press Secretary Sandi Copes wouldn’t comment regarding Gillman’s departure, except to wish him “the best of luck in his new endeavors.”

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