RealTime IT News

Sex Sites Accused of Gouging Visitors with Phone Scam

An old Internet scam has re-emerged in new clothes. At least two adult Web sites are allegedly conning visitors into downloading a piece of dialing software in order to view pictures for free, when in fact the users are unknowingly ringing up hundreds of dollars in long-distance charges.

The sites, nocreditcard.com, and sexnocard.com, promise no subscription fees and no censorship. But what some visitors may not realize is that the dialing program is using their modem to bypass the Internet and call another modem in the central African country of Chad -- at the rate of $7.30 per minute during prime time.

According to AT&T spokesperson Mark Siegel, the long-distance carrier has been receiving complaints from customers about unusual charges to Chad since January.

"On probing a little further, we usually discover that they were going to the site and didn't know what they were getting into, or worse, their kids had gone to the site. You can suddenly be hit with a whopping bill if you spend any time," said Siegel.

While the operators may be giving their digital content away for free, they are hauling in a cut of the international calling settlement fees paid by carriers like AT&T to foreign phone companies. E-Group, the firm which developed the dialing system, pays merchants 25 cents for each minute that their visitors log in long-distance calls, according to information at its site.

The setup is reminiscent of an earlier case in which several adult sites were duping visitors into unknowingly making long-distance calls with their modems to Moldova in eastern Europe.

In 1997, the FTC got an injunction to shut down Web sites operated by two firms, AudioTex Connection and Promo Line, Inc., but not before the firms had allegedly racked up millions of dollars in fees indirectly from consumers.

Representatives of e-Group, which claims to have 299 customers and appears to be based in Dublin, Ireland, did not respond to interview requests.

The e-Group site boasts that its calling system is "the most profitable Webmaster's program in the Internet business," and that it gives site operators a way to make money from their digital content from people who don't have credit cards or are reluctant to use them on the Web.

In addition to its client-side dialer software, e-Group offers sites a billing system, as well as the benefit of its contacts with telecommunications firms around the world willing to participate in the scheme.

Michael Killen, president of electronic payment research firm Killen & Associates, said most legitimate webmasters will quickly see e-Group's system for what it is.

"Who would send somebody over expensive long-distance lines to spend premium dollars when they could get access over the Internet at a lower rate? Making your money off the telephone call, especially if you say the service is free, is a scam," said Killen.

After users download the dialing software from e-Group, they must agree to a lengthy click-wrap contract which clearly states that they will be making a long-distance call to Chad.

Whether e-Group has successfully shielded itself by those legal disclaimers remains to be seen, according to Peter Fitzgerald, an associate professor of Law at Stetson University in Florida.

"It's possible to set up such a contract with a click-through agreement, but whether they have done it in a way that's going to be upheld in every jurisdiction is another question," said Fitzgerald.