Spyware Creator Facing Up to 175 Years in Prison

The Department of Justice has indicted a man who allegedly created a spyware program designed to break into computers and illegally intercept the electronic communications of others.

Carlos Enrique Perez-Melara, whose whereabouts are unknown, is facing up to 175 years in prison and $8.75 million in fines if convicted on each count of a 35-count indictment handed down by federal prosecutors Aug. 26.

"This federal indictment – one of the first in the country to target a manufacturer of ‘spyware’ computer software – is particularly important because of the damage done to people’s privacy by these insidious programs," Acting Assistant Attorney General John C. Richter said in a press release.

According to the indictment, Perez-Melara created and marketed "Loverspy," an $89 computer program designed for people looking to secretly spy on another computer user’s e-mail, passwords, chat sessions, instant messages and other personal information. Perez-Melara directed people who bought the program to log into the Loverspy Web site and choose an electronic greeting card to send to up to five different e-mail addresses.

Once the e-mail greeting card was opened, Loverspy secretly installed itself on the victim’s computer, according to the indictment. From that point forward, all activities on the computer were intercepted, collected and sent to the purchaser directly or through Perez-Melara’s computers in San Diego, the government alleges.

The indictment further charges that Loverspy also gave the purchaser the ability to control the victim’s computer by allowing the purchaser to access, change or delete files and by turning on Web-enabled cameras connected to the victim’s computer.

More than 1,000 people worldwide purchased Loverspy and used it against nearly twice as many victims, the indictment says.

Perez-Melara is being charged with manufacturing, sending and advertising a surreptitious interception device and accessing protected computers for financial gain.

The Department of Justice also indicted four individuals who purchased the Loverspy program with two counts of computer hacking. The defendants are John J. Gannitto of Laguna Beach, Calif.; Kevin B. Powell of Long Beach, Calif.; Laura Selway of Irvine, Calif.; and Cheryl Ann Young of Ashland, Pa.

Each of the four defendants is facing up to 10 years in prison and a fine of $500,000.

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United States v. Perez-Melara, No. 05CR1264LAB, indictment unsealed (S.D. Cal. Aug. 26, 2005).

Provided by Jason Schossler of Andrews Publications.