Spam 'Godfather' gets 51 months in prison
These past few days have seen some notable cyber justice cases: Late Monday, Alan M. Ralsky -- a man dubbed the "Godfather of Spam" -- was sentenced to 51 months in prison. And on Friday, a California man pleaded guilty in a case involving the sale of counterfeit high-tech computer parts to the U.S. military.
Ralsky, 64, of West Bloomfield, Mich., joined two co-conspirators in earning stiff prison sentences for long careers of blasting junk e-mail. Following more than four years in prison, Ralsky will be subject to five years of supervised release and will forfeit $250,000 the government seized from him in December 2007, the Justice Department said.
According to the government, Ralsky was a top promoter of so-called pump-and-dump scams, schemes in which fraudsters buy up a bunch of low-priced microcap stock, blast out millions of spam e-mails touting it as a hot buy and then dump their shares as soon as the share price ticks up from all of the spam respondents buying into the scam.
Anti-spam group Spamhaus.org said Ralsky has been spamming since at least 1997, using dozens of aliases and tens of thousands of "zombies" or hacked PCs to relay junk e-mail.
Last January, a federal grand jury named Ralsky and 10 others from China, Canada, Hong Kong and Russia in a 41-count indictment for wire fraud, mail fraud, money laundering and violations of the CAN-SPAM Act. Ralsky's 48-year-old son-in-law, Scott K. Bradley, also was among the indicted, and was sentenced last week to 40 months in prison and the same supervised release terms.
Also sentenced in connection with the scheme was How Wai John Hui, a 51-year-old man who held dual citizenship in Canada and Hong Kong. Hui got 51 months in prison, followed by three years supervised release. John S. Brown, 45, of Fresno, Calif., who received 32 months and a three years supervised release.
In a separate action, Neil Felahy, 32, of Newport Coast, Calif., pleaded guilty (PDF) to one count of conspiring to traffic in counterfeit goods to defraud the United States. Federal prosecutors say Felahy and several co-defendants sold the knockoff parts to the U.S. Navy using a number of California companies, with names like Pentagon Components and Force-One Electronics. The government alleges Felahy and others took trademark-branded integrated circuits and other computer components, ground off the original markings, re-branded them with other trademarks and passed the devices off as military grade.
Why is fudging the label on computer parts sold to the government such a big deal? The Justice Department explains:
"The use of counterfeit integrated circuits can result in product malfunction or failure, and can also cause serious bodily injury from electrocution and, in some circumstances, death. Markings on integrated circuits indicate a part is 'commercial grade,' 'industrial grade,' or 'military grade.' Military grade markings signify that the part has been specially manufactured, among other things, to withstand extreme temperature ranges and high rates of vibration. Legitimate manufacturers subject such parts to specialized testing not used in the production of differently graded parts. Military grade integrated circuits are sold to the U.S. military at a higher price than commercial or industrial grade parts because of the special manufacture and testing required."
Felahy faces up to 51 months in prison and more than $2 million in fines. His sentencing is expected sometime next year.
November 24, 2009; 1:16 AM ET
Categories: Cyber Justice | Tags: alan ralsky, spam
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