Scammers who infected more than 15 million computers with destructive, intrusive spyware will give up $330,000 in ill-gotten gains from their venture to settle FTC charges that their scam violated federal law.

The settlement will bar the defendants from downloading software onto consumers computers without disclosing its function and obtaining consumers consent prior to installation, bars them from downloading software that interferes with consumers computer use, and bars false or misleading claims.

In November 2006, the FTC charged ERG Ventures, LLC and its principals with tricking consumers into downloading malevolent software by hiding the Media Motor program within seemingly innocuous free software, including screensavers and video files. Once downloaded, the Media Motor program silently activated itself and downloaded malware that was intrusive, disruptive, and made it difficult for consumers to use their computers.

The software changed consumers home pages, tracked their Internet activity, altered browser settings, degraded computer performance, and disabled anti-spyware and anti-virus software. Many of the malware programs installed by the Media Motor program were extremely difficult or impossible for consumers to remove from their computers.

The FTC charged that ERG Ventures and its principals violated the FTC Act, which bars unfair and deceptive practices. Specifically, the FTC said the defendants failed to disclose to consumers that the free software they offered was bundled with malware. The agency also charged the defendants with using a deceptive End User License Agreement, which gave consumers the option to halt the installation of all software from ERG Ventures, but secretly installed malware whether consumers accepted or rejected the terms of the agreement.

At the request of the FTC, the U.S. District Court for the District of Nevada froze the defendants assets and ordered a halt to their spyware operation pending trial.

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