FTC Charges Seven Companies for Affiliate Spam

The Federal Trade Commission (FTC) has charged seven companies with violating anti-porn provisions of the CAN-SPAM Act as a result of activity by their marketing affiliates, the commission announced yesterday.

Though the seven firms didn’t email consumers directly, they operated affiliate marketing programs in which they paid others to send spam on their behalf, the FTC said.

Under the CAN-SPAM Act, which became effective Jan. 1, 2004, companies are liable for illegal spam sent by their affiliates.

At the FTC’s request, the Department of Justice (DOJ) has filed suit against three of the companies: TJ Web Productions of Henderson, Nev., Cyberheat Inc. of Tucson, Ariz., and Impulse Media of Seattle. The DOJ is seeking unspecified civil penalties and a permanent bar on illegal marketing by the firms.

The other four companies have settled for a total of $1.2 million, the FTC said.

BangBros.com of Miami agreed to pay $650,000; MD Media of Bingham Farms, Mich., agreed to pay $238,743; APC Entertainment of Davie, Fla., will pay $220,000; and Pure Marketing Solutions of Miami and Internet Matrix Technology of New Orleans will together pay $50,000, the FTC said.

The FTC charged the companies sent sexually explicit email messages that weren’t labeled as such, failed to provide clear opt-out mechanisms, and messages contained no postal addresses.

The FTC’s adult labeling rule and the CAN-SPAM Act require commercial emailers of sexually explicit material to include “SEXUALLY EXPLICIT” in the subject line and to ensure the initially viewable area of the message does not contain sexual images.

“The adult labeling rule was designed to protect consumers who don’t want to be exposed to random assaults of sexual material and others, like kids, for whom it’s inappropriate,” said Lydia Parnes, director of the FTC’s bureau of consumer protection, in a statement. “It’s the law and we intend to enforce it.”

Under the CAN-SPAM Act, unsolicited commercial email of all types is required to contain an opportunity for consumers to opt out of receiving future email from the sender and provide a postal address.

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