Court bars company from online sale of phone records

A U.S. court in Wyoming has ordered a Web-based information broker to stop selling telephone records without owners' consent and to turn over nearly US$200,000 in profits from the operation, the U.S. Federal Trade Commission announced Monday.

AccuSearch, doing business as, and owner Jay Patel used "false pretenses, fraudulent statements, fraudulent or stolen documents or other misrepresentations" to induce telecom carriers to disclose the confidential records, the FTC said in a news release.

Judge William Downes of the U.S. District Court for the District of Wyoming ordered the company to stop selling telephone records in a Dec. 20 decision announced Monday. The judge also ordered the company, based in Cheyenne, Wyoming, to turn over information so that the FTC can notify the people whose telephone records were sold. advertised that it could obtain the confidential phone records of any individual -- including details about outgoing and incoming calls -- and make that information available to customers for a fee, the FTC said in a May 2006 complaint. The FTC charged that the company's methods of obtaining phone records, including posing as a customer of a telecom carrier, violated the FTC Act, which bars unfair business practices.

A representative of didn't immediately respond to a request for comment. The company continues to sell information such as criminal, tax, mortgage and driving records through its Web site.

The defendants have appealed the order to the U.S. Tenth Circuit Court of Appeals.

Downes found that the company's ways of obtaining phone records without consumers' consent was "necessarily accomplished through illegal means," and that defendants knew that the phone records were being obtained surreptitiously.

The company's actions caused major problems to consumers, including serious health and safety risks experienced by some consumers from stalkers and abusers; economic harm associated with changing telephone carriers and upgrading security on their accounts; and a host of "substantial and real" emotional harms, the judge said.

Consumers had no way to avoid these harms, he wrote. "In fact, the evidence presented before the court indicates that confidential consumer phone records were sold through despite considerable efforts by consumers to maintain the privacy of those records," the judge wrote.

Finally, the court found no countervailing benefits to consumers or competition that could be derived from the defendants' practice.

Downes also rejected the defendants' claimed immunity under the Communications Decency Act, a federal statute that confers immunity on interactive computer service providers for publishing information content provided by a third party. The judge found that the argument failed partly because the defendants participated in creating the content they sought to have immune from prosecution, the FTC said.

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