Companies fined for using 'Army.com,' other scam websites to steal personal data
The Federal Trade Commission has shut down several websites and issued a $12.1 million fine against a group of companies that illegally gathered personal information from prospective military enlistees, then sold it to marketing companies and for-profit colleges.
Sunkey Publishing Inc. and Fanmail.com LLC have agreed to relinquish their domain names, including army.com and armyenlist.com, and to stop deceptive marketing practices, according to a settlement filed Thursday in the U.S. District Court for the Northern District of Alabama.
The civil judgments of $11.1 million against Sunkey and $1 million against Fanmail have been suspended due to the defendants’ inability to pay, unless they are later found to have misrepresented their assets to the FTC.
The Justice Department filed the suit on behalf of the FTC.
Sunkey Publishing and Fanmail.com were running about a dozen websites that looked very similar to official military recruiting sites and claimed to be affiliated with the military.
The websites collected personal data from prospective enlistees wanting information about joining the military. The websites promised the information wouldn’t be shared with third parties and only used for military recruitment purposes. Instead, the defendants made millions of dollars selling the information at $15 to $40 a lead to for-profit post-secondary schools, the FTC said in court documents.
Sometime after submitting their data, the victims would receive an email stating that the military was downsizing.
“Army.com wants you to know that there are more ways for you to serve your country than just military service,” the emails said, according to court records. “If you had a college education you could contribute through engineering, science, law, health care, and more.
“For every soldier that serves our country there are many more citizens who provide the technology and service that give them the ability to serve safely. We urge you to understand all your options as you make the choices that shape the rest of your life.”
The emails were followed by phone calls from telemarketers who posed as servicemembers, touting specific schools and giving consumers the false impression that the military endorsed those schools, according to the FTC.
The commission estimates thousands of prospective enlistees were victimized and that many post-secondary schools turned a blind eye to the origins of the marketing leads.
The FTC also stated the defendants placed hundreds of thousands of illegal telemarketing calls to phone numbers on the National Do Not Call Registry.
“Those who are considering a military career deserve to have confidence that the recruitment site is legitimate and their personal information will not be misused,” FTC Chairman Joe Simons said in a statement. “The FTC will take action against any party in the lead generation ecosystem – from sellers to purchasers – that fails to comply with the law.”