Subject: [Asrg] Spammer case studies?

From: Barry Shein <[email-masked]>
Date: Sun, 26 Mar 2006 19:42:57 -0500 (EST)

Does anyone know of any, or preferably a collection of, case studies
of spammers' businesses with lots of hard facts?

  You can stop right there, the rest of this note just refines that
  one sentence inquiry in a tiresome manner.

I'm thinking of either something in the business school model, or
details from someone who has worked their way down to primary sources
on one or more spammers such as 1040's, perhaps seized internal
record-keeping, investigative post-mortem auditing by qualified
forensic accountants, etc.

What I don't need any more of is:

  Circumstantial evidence like: He had a fancy car when arrested, he
  must've made a lot of money off spamming!

  Articles etc which just seem to repeat other articles: According to
  the Daily Truth he was making millions off spamming. And then when I
  go look at the Daily Truth article it cites the Weekly Truth which
  cites the Monthly Truth which maybe said "he had an expensive car!"
  or similar hearsay.

  "Common sense": Why else would they do it? Duh, I dunno, how much
  was Andrea Yates paid to drown her five children in her bathtub? Why
  else would she do it? I know, macabre, but let's face it there are
  nutso people in the world, and people who play the lottery, or
  gamble the house on a sports game, etc. etc. Can't really reason
  backwards reliably.

  Put another way, such assertions justify asking the question but
  doesn't actually answer the question.

For example, the recent news about Chris "Rizler" Smith (go google the
name.) He had a lot of wealth allegedly acquired via prescription
fraud at the time of his arrest.

But reading the articles carefully seems to indicate he spammed
viciously for a while but then moved on to magazine ads and so forth.

It's not at all clear whether any significant money came from the
spamming. This is particularly suspicious in that he seems to have
given up on spamming, or at the very least aggressively branched into
other forms of advertising, long before his arrest. So how much of his
apparent wealth arose from spamming?

I've been looking through dozens and dozens of articles, papers, etc
and I've yet to come up with anything convincing to a skeptical eye.

Ralsky probably made some money from spamming but again it's not clear
how much. Was it reported to the IRS? Is it possible to see those
reports? If not, then is he being charged with tax fraud? I can't find
that.

Obviously it's all relative. Clearing, say, $100K/year might be an
enormous amount of money to trash like Ralsky. I wouldn't sneeze at
$100K/yr but I wouldn't call it "a lot of money" either, it ain't
"millions".

It also leaves open the question as to whether that money came from
profits from spamming made by him or his customers?

Or did he just hustle his customers out of that much money for
spamming services and the spamming per se never really made them any
money; his customers were victims in a sense also paying into false
hopes of non-existant returns as happens so often in shady (and even
legitimate) business schemes.

My speaking to people who actually have worked these cases indicates
the sort of people who engage in spamming and other crime tend to have
the common quality of being into instant gratification. They'll clear
$5K and run out and put it down on a fancy car before paying the rent,
that kind of thing.

Oftentimes, other than hard assets such as automobiles, they'll have
little or no liquid assets at the time of their arrest. Usually
they're financial wrecks having used a few bucks they made to just dig
themselves deeply into debt, such as downpayments on fancy cars or
security deposits and a coupla months' rent on fancy digs.

-- 
        -Barry Shein

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From: Steve Atkins <[email-masked]>
Date: Sun, 26 Mar 2006 18:14:41 -0800

> of spammers' businesses with lots of hard facts?

I hate to think of the thread that this will spawn, but...

Define "spammer". From the rest of your mail I got
the impression you're talking about people who harvest
addresses and try and sell (possibly fraudulent) products
to those recipients, but it wasn't entirely clear.

You need to be pretty specific when using such loaded
terms if you want useful answers.

Cheers,
   Steve

---

From: John Levine <[email-masked]>
Date: 27 Mar 2006 02:17:17 -0000

>of spammers' businesses with lots of hard facts?

In the Jaynes criminal case, it was uncontested that he'd made over
$20M from spamming out Fedex refund kits and the like.  The judge
accepted that as a reason to put an ankle bracelet on him to keep him
from running out of the country.

---

From: Barry Shein <[email-masked]>
Date: Mon, 27 Mar 2006 11:50:01 -0500

> terms if you want useful answers.

I'll take that as a "no, I don't know of any". It's not really
necessary to each weigh in with a negatory.

How about hard info about anyone who has made money on a zombie bot
army?

I realize one might say well they're all from Outer Slobbovia where $1
American can buy you a mansion but again that's just circumstantial
and not "facts".

I know there were some significant busts of such people recently in
that seething pit of third world misery known as Holland, but were
they making much money? I dunno.

I'll look into the Jaynes case John mentioned.

-- 
        -Barry Shein

---

From: Steve Atkins <[email-masked]>
Date: Mon, 27 Mar 2006 09:37:55 -0800

> necessary to each weigh in with a negatory.

I know of lots. But your question was far too broad to be really
useful. That's why I asked for clarification.

There are a number of public companies that are, by any
reasonable definition, spammers. Numbers about their
businesses are easy enough to get hold of. There are a
bunch more that are private companies. They're pretty easy
to get hold of too.

But without knowing what flavour of spammer you're interested
in, the question was way too broad.

> How about hard info about anyone who has made money on a zombie bot

Most of the numbers I've seen about actual profit from the zombie
hordes (rather than ddos exortion amounts) have been click-fraud,
rather than spam. In the case that closed a couple of months ago
that was $58,000 over 13 months for click-fraud.

> I'll look into the Jaynes case John mentioned.

The AZ attorney general confiscated something like thirty million
dollars from a group of penis enlargement spammers.

It's hard, though, to argue what fraction of that is actually due to the
spam rather than due to the sale of dodgy pharmeceuticals. That seems to
be not unusual for the more profitable end of spammers - they're
selling a profitable product and spam is just one thing they do, so
it's hard to say how much the spam drives those revenues.

Cheers,
   Steve

---

From: "David Nicol" <[email-masked]>
Date: Mon, 27 Mar 2006 12:53:47 -0600

might be worth a look:

http://www.pitch.com/Issues/2004-04-08/news/feature.html

---

From: "Chris Lewis" <[email-masked]>
Date: Mon, 27 Mar 2006 14:18:28 -0500

> it's hard to say how much the spam drives those revenues.

Frankly, I don't think the original question can at all be answered, or
at least, not by us to the level of certainty that Barry wants.

How many <insert your favourite _real_ company> really has any idea of
how much revenue was derived from ad technique X, vs. ad technique Y. If
they do, it's because they're asking at the time of sale.  Can you
imagine bot controllers actually asking that, let alone, being able to
gather/measure accurately?

Secondly, the only people (aside from the criminals) able to answer that
is law enforcement officials, in the case of "products" only sold thru
spam unless _they're_ willing to do statistical breakdowns of
lead-origin (what on earth for, the convictions usually aren't based on
spam per-se?), they're not going to know, and frankly, they'll probably
not tell us in that level of fine granularity even if they knew it.

When you see a conviction of, say, someone like Rizler, absent
indications that they marketed by any other means, what else would you
assume the revenue report is of?  Even if it's word-of-mouth, the
original was by spam.

Thirdly, they're criminals - rule #1.

Fourthly, the only people making these pronouncements are the spammers
themselves and LE.  Both of which have an incentive to exaggerate. Mind
you, whenever I've seen a spammer claim huge revenues and had
independent results shown, the spammers lied big time.  Eg: Slaton
claimed to be making 6 figures/month.  Oh no, he was fleeing process
servers, and his vehicles were repro'd.  Canter (of Canter and Siegal)
was trying to get a programming job (I have a copy of his resume around
somewhere) and was fleeing process servers sic'd on him by his (ex) wife
Siegal. Etc.

Fifthly, do we include phishers/CC scammers, 419s etc?

All we can take as a given is that _someone_ is making money out of this
mess.

---

From: Barry Shein <[email-masked]>
Date: Wed, 29 Mar 2006 16:10:10 -0500

Perhaps my mental model is flawed but I generally see spammers as two
major subgroups:

a) People who have something to sell, such as herbal viagra, and
develop a spam organization as part or all of their marketing efforts.

b) People who only (or primarily) sell spamming services, including
infrastructure such as zombie bot armies.

I was interested in either or both in my question regarding hard
evidence on income.

However, it would seem that (b) is the more pure play question since,
as has been pointed out, it may be hard to separate out how much
income was specifically from spam for (a).

-- 
        -Barry Shein