The Latest Net Scam—Modem Hijacking
By Cade Metz
May 28, 2003
Our feature on the world of spyware didn't scare you? This will. PCs the world over are being hit by a new breed of software known as a dialer. These programs are far more malicious than spyware, which merely keeps a record of your online behavior. Dialers use your modem surreptitiously to dial long distance telephone numbers, running up enormous charges on your phone bill. Some operate while you're surfing the Web, dropping your dial-up connection and reconnecting you through a new number. Others operate when you're away from your machine, dialing numbers after the system sits idle for long periods of time.
This sort of scam—known as modem hijacking, dialer hijacking, or Internet dumping—has become alarmingly prevalent over the past few months. At Badbusinessbureau.com, nearly 1,200 people have complained about a modem hijacking scam run by a New Jersey company known as Alyon Technologies. "On May 16th, 2003, I received a bill from Alyon Technologies for services rendered in the amount of $454.57 for the use of a phone number 6 times in one day," reads one complaint from Bevington, Iowa.
The Federal Trade Commission (FTC) and 20 different state attorneys general are currently investigating the company, but with many similar scam artists operating overseas, you have to provide your own protection.
Typically, dialers are loaded onto systems via an ActiveX script. At the very least, you should make sure your Internet browser is set to reject Active X code or warn you when such code attempts to run. If you're unsure whether your browser is protected, SpywareInfo.com provides a dialer test that can tell you whether your browser is vulnerable.
If you want a greater degree of protection, an Australian company called StopItNow! is selling software that specifically prevents malicious dialers from hijacking your modem. Available for $24.95, the application monitors Windows Dial-Up Networking, ensuring that it dials no unapproved numbers.
If a modem hijacker gets to your machine before you can set up the proper protection, and unapproved charges wind up on your phone bill, the best way to fight the charges is through the FTC or your state utility commission. "The least useful thing you can do is complain to the phone company," says Russ Blau, a partner with the national law firm Swidler Berlin Shereff Friedman and part of its telecommunications, Internet, and new technologies practice. "They're just going to try to collect the charges."
Any complaint you file with the FTC or a state utility commission, says Blau, will be forwarded to your phone company. "In virtually every case, the phone company cannot take collection action against you or cut off your service if you have an FTC complaint pending." And, hopefully, the FTC will go after those perpetrating the scam and the phone companies will quit billing charges from the numbers in question.