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March 29, 2005
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Spitzer and Microsoft united in legal actions against Scott Richter, who has been dubbed the world's third-largest spammer by ROKSO, the Register of Known Spam Operations, an anti-spam and consumer advocacy organization, and Synergy6 Inc., an e-mail marketing company based in New York, in fact, subcontracting work to Richter.
Authorities allege that Richter and his accomplices in Washington, Texas and New York are responsible for seven illegal spam campaigns, each in violation of consumer protection statutes in New York and Washington.
These campaigns used common spam techniques such as forged sender names, false subject lines, fake server names, inaccurate and misrepresented sender addresses, or obscured transmission paths.
The lawsuits charge Richter and his accomplices with responsibility for sending illegal spam through 514 compromised Internet Protocol (IP) addresses in 35 countries spanning six continents.
OptinRealBig settled with New York last year for $40,000 in fines and $10,000 in investigative costs, but the Microsoft case remains pending along with several other lawsuits.
Steven Richter said he considered the relatively small size of the settlement a sign that the New York attorney general didn't believe it had much of a case. Richter said OptinRealBig operates within the bounds of the law.
But the news release from Spitzer announcing last year's settlement still termed Scott Richter a "deceptive spammer."
Steven Richter, lawyer for OptInRealBig.com and Scott Richter's father, strongly disputed the characterization of his son's activities and said the company plans to reorganize and remain in business. The 5-year-old company, which employed 25 people last year and had 350 clients, will continue to operate under Chapter 11 bankruptcy protection, he said.
The company says it provides vital marketing services to both publicly and privately held clients, with more than 45 million online consumers in its database. Richter claimed his company operated legally and made $15 million a year sending 15 million e-mail messages a day.
Steven Richter said OptInRealBig has debts of under $250,000 and assets exceeding $1 million. "The company is extremely viable and healthy," he said. "It's continuing to grow."
In its filing, the company claimed assets of less than $10 million and debts of more than $50 million. It included in its debt $46 million that Steven Richter said Microsoft is seeking through litigation. Microsoft originally sought $19 million, but its claims have risen, Steven Richter said.
Despite Richter's vow to remain in business, Aaron Kornblum, Microsoft's Internet safety enforcement attorney, said the bankruptcy filing means that "a significant spigot of spam is closed."
Scott Richter also has filed for personal bankruptcy in Colorado.
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