Two Arrested in First Test of Anti-Spam Law

Federal authorities said Thursday that they had arrested two e-mail marketers and were searching for two others in the government’s first use of a new law designed to crack down on “spam� e-mail.

A raid was conducted on a Detroit-area operation accused of sending out millions of e-mail advertisements for a fraudulent weight-loss patch, the Federal Trade Commission said.

Daniel Lin, Mark Sadek, James Lin and Christopher Chung could face up to five years in jail under a new anti-spam law that took effect in January.

They also face mail-fraud charges, which carry a maximum 20-year sentence.

Through their company, Phoenix Avatar, the four defendants earned nearly $100,000 per month selling a diet patch that had no effect, the FTC charged.

The defendants used the e-mail addresses of others to cover their tracks, a technique known as “spoofing,� the FTC said.

Spoofing is illegal under the new anti-spam law.

Innocent e-mail users were swamped by undeliverable return mail and complaints when their addresses were spoofed, and some were mistakenly labeled as spammers and blacklisted by service providers, the FTC said in a court filing.

Consumers have forwarded 490,000 of the company’s e-mails to the FTC since January, the consumer protection agency said. The operation has been shut down and the defendants’ assets frozen pending trial.

Daniel Lin, who has not yet been arrested, is listed as one of the Internet’s most prolific spammers by the anti-spam group Spamhaus. James Lin has not yet been arrested either.