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Washington state sues over spyware

Microsoft joins state lawmakers in filing suit against a software maker they say preyed on people's fears to sell a fake security tool.

If you paid $49.95 for Spyware Cleaner from Secure Computer, you have been duped, according to Microsoft and Washington state's attorney general.

The Redmond, Wash.-based software maker and Attorney General Rob McKenna have filed a pair of lawsuits against Secure Computer and its principals, charging them with violating the Washington Computer Spyware Act and three other laws. The suits were filed Tuesday in U.S. District Court for the Western District of Washington.

"Our suit accuses New York-based Secure Computer and certain individuals in New York, New Hampshire, Oregon and the nation of India of preying on consumer fears about spyware," McKenna said Wednesday during a news conference announcing the action.

The Washington Computer Spyware Act, effective since mid-2005, provides for a fine of up to $100,000 per violation, McKenna said. The action is the first lawsuit filed by the state's attorney general under the new law.

An attorney for Secure Computer said his client was "shocked and surprised" by the allegations. "We are evaluating the situation and hope to address the merits of these allegations...shortly," John W. Dozier of Dozier Internet Law said in a statement sent via e-mail.

Secure Computer allegedly used deceptive links on search engine Google's Web site, as well as in pop-up advertising and in spam e-mail for Spyware Cleaner to imply that the software came from or was endorsed by Microsoft, McKenna said. Additionally, the company is accused of using a Windows feature to pop up warnings on users' PCs, telling them their system had been compromised, he said.

The messages urged the users to run a spyware scan. "The program...falsely claims that a computer is infected with spyware," McKenna said. The PC users were subsequently advised to buy Spyware Cleaner for $49.95 to remove the malicious software, he said--but the product did not do what it promised.

"Not only does the program fail to clean a computer of spyware; it actually will change a computer's settings that leave it susceptible to future attacks from other spyware and related programs," McKenna said.

Microsoft said it helped the attorney general by providing technical information and analysis. The software maker also filed its own, similar lawsuit against Secure Computer and individuals associated with that company.

Ben Edelman, a Harvard Law School student and spyware researcher, applauded the action against Secure Computer. The company seeks "to play on users' fears, and...to take advantage of users who are just trying to protect themselves," he said. "I'm pleased to see Microsoft and the state of Washington moving to stop these deplorable practices."

Spyware and adware have become widely despised for their sneaky distribution tactics, unauthorized data gathering and tying-up of computer processing power. The terms are used to describe software that pops up ads on a PC screen or that can log keystrokes, make screenshots and track a user's Web-surfing habits.

As many of 60 percent to 80 percent of consumers' PCs are infected with the annoying software, said Kirk Bailey, chief information security officer at the University of Washington, who joined Microsoft and the attorney general at the news conference.

"The bad news is that that those who continue to engineer and build those kind of tools are getting better at it," he said. "Advances in spyware are winning the arms race. The ability to inspect and remove spyware after you have been infected is a serious challenge."

To minimize exposure to spyware and other online threats, consumers should use a firewall, run regular software updates, and use an up-to-date antivirus program and anti-spyware software, Microsoft has advised.