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Christchurch spam raid has sequel in court


Embargoed: for publication Wednesday 15 October 2008


The Department of Internal Affairs has asked the High Court to impose financial penalties of $200,000 on each of three New Zealanders involved in a major international spamming operation. This is the first court action since the introduction of the anti-spam law, the Unsolicited Electronic Messages Act on 5 September 2007 and follows a raid on four Christchurch addresses last December.

The Department, in its Statement of Claim filed in Christchurch, alleges that company directors, Shane Atkinson, of Christchurch, his brother Lance Atkinson of Pelican Waters, Queensland and Roland Smits, courier of Christchurch, were involved in sending over two million emails to New Zealand addresses alone between 5 September and 31 December 2007, earning sales commissions of more than $US2 million from this global operation. The emails marketed Herbal King, Elite Herbal and Express Herbal branded pharmaceutical products, manufactured and shipped by Tulip Lab of India, through a business known as the Genbucks Affiliate Programme. This business was operated by Genbucks Ltd, a company incorporated in the Republic of Mauritius.

The Department says that Shane Atkinson was co-manager of the Genbucks Affiliate Programme; Lance Atkinson, trading under the name of Sancash, recruited and paid spammers to market Genbucks products, adult sex toys and replica watches; Roland Smits registered the internet domain names used in the Sancash spam emails and created the alternative subject lines used to avoid interception by internet service providers' spam filtering software.

The Department had been working with international agencies for two months gathering evidence on the Christchurch spamming operation when, just days before the raid, Shane Atkinson instructed his brother, Lance to cease spamming after being contacted by BBC reporters investigating their activities.

Internal Affairs Deputy Secretary Keith Manch paid tribute to the co-operation with overseas agencies, particularly the USA's Federal Trade Commission, in helping the Department conclude its investigation.

"The FTC was a great help," Keith Manch said. "They were able to provide technical information which made it possible for our investigators to identify the defendants and obtain evidence of the alleged offending."

The FTC has filed its own complaint in the US District Court against Lance Atkinson, his Australian Company, Inet Ventures Pty Ltd, an American citizen, Jody Smith, and three US companies over spamming activities conducted after Internal Affairs seized computers and records from the Christchurch operation.

The UEM Act was passed by Parliament last year. It stops New Zealand from becoming a spammer's haven, Keith Manch said.

"We entered into international agreements to share information about spamming and pursue cross-border complaints," he said. "The negative effects of spam are significant and far-reaching. Current estimates suggest that around 120 billion spam messages are sent every day. These emails clog up the Internet, disrupt email delivery, reduce business productivity, raise internet access fees, irritate recipients and erode people's confidence in using email."


ENDS

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