An Australian court has slapped a stiff fine of $2.5 million on a former porn site operator for milking unwary customers through fake profiles on Internet dating sites.
The operator, Scott Gregory Phillips, employed backpackers to create the profiles and gather mobile phone numbers, to which were unsolicited text messages offering SMS chat, using services described as SafeDivert or Maybemeet.
The Federal Court in Brisbane heard the employees of IMP and its agent Jobspy Pty Ltd, obtained the mobile phone numbers of dating websites users before sending SMS texts such as: "Get laid, text your number to ...".
Those who responded had to cough up anything up to $5 a message for SMS sex chat services. The chat victims didn't get to "chat" with genuine members of dating sites but to employees of Mobilegate and Winning Bid.
The Australian Communications and Media Authority (ACMA) took action against Phillips for violations of the Spam Act and Trade Practices Act of Australia, for which the maximum penalty was $2.5 million.
The penalty on Phillips is in addition to $22.25 million imposed last year on four other people and three companies - once Hong Kong based - involved in the "SafeDivert" scam, bringing the total amount of penalties to $24.25 million.
Following a court hearing earlier this year, Justice John Logan last month found against Phillips ruling that he had been involved in the start-up of the scheme and controlled its operations from his home in Mt Nebo, in Brisbane's north.
He found Phillips was the mastermind of the business, which used "deception for profit", between December 2005 and April 2006.
"Phillips' involvement was at the most senior level ... it involved systematic and studied deception of those who use internet dating websites," he said.
The court was told the operation netted $140,000 over the 54 days Phillips was involved before he was jailed in April 2006 for criminal charges which included torture.
During the three-year period it operated, the company sent 1.8 million messages which brought in a revenue of $4 million.
Justice Logan today said Phillips, who he found had lied during his evidence in the trial, would have left his victims humiliated.
"This conduct plays with a person's emotions, that is a factor I will take into account," he said.
Justice Logan also imposed injunctions which prevent Phillips from similar conduct and, in particular, from setting up profiles other than his own on dating and social networking sites for the next seven years.
The ACMA has alleged that the scheme cost Australian mobile phone users in excess of $4 million, but now it has got that back sixfold, though it's unclear just how much, if any, will go to the victims, commented a website.