The day before yesterday an affiliate (who runs a review website) posted the following comment under my 2009 What Is Cookie Stuffing post:
Coincidentally, also the day before yesterday the industry’s famous fraud detective Kellie Stevens wrote up an article that has, undoubtedly, become a sobering one for many. Two years after being indicted for cookie stuffing (which resulted in eBay paying the violators over $20 million in affiliate commissions) Shawn “Hogan has pled guilty to one count of wire fraud” and is now awaiting sentencing which “is scheduled for February 11, 2013.” [see Kellie’s full article here]
In their Criminal Law textbook Thomas J. Gardner and Terry M. Anderson give a good concise explanation of what exactly “wire fraud” is defining it as:
A fraudulent scheme that uses interstate or international wire or other electronic communications. (p. 484)
The United States Code elaborates:
Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be fined under this title or imprisoned not more than 20 years, or both. (18 USC Sec. 1343)
Yes, cookie stuffing is a very serious criminal offense. If you, as an affiliate, are already engaged in it, or just thinking of doing it (like the author of the above-quoted comment), think again! It isn’t worth it.
Great article, Geno. Thanks for sharing.
Thank you, Ashley, and my pleasure. Hugely important topic.
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Funny I was just have a similar conversation with a colleague.
It is illegal and immoral. My hope is that one of those two facts will deter most from doing it.
I was thinking of bringing up the moral constituent, but decided to only stick with the (more powerful for the majority of cookie stuffers) legal component.
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It still happens too much, I hope this will give the other fradsters a warning. Great article.
great article Geno. this is totally unethical, are their any software’s that can detect this …
Sudhanshu, good question. I don’t know of any such software; but talk to Kellie Stevens of AffiliateFairPlay.com (who is referenced above), Wesley Brandi of iPensatori and/or Ben Edelman of BenEdelman.org.
I will just like to point out that this law does not just apply to cookie stuffers, but can will be used on any affiliate who misrepresents what they are promoting.
So don’t think you are safe because you are not cookie stuffing, f you operate a website where you are misrepresenting the facts (deceiving) your viewers inorder to attain a sale, you are committing wire fraud.
But like most cookie stuffers, you will not be brought to justice until you have made a hell of a lot of money, $20 million made before being sued sound about right?
People in Romania and other countries are not worried about US legal threats.
Not sure I’d single out any one country, Bob; but you’re right – rogue affiliates located outside the U.S. are, unfortunately, not always getting stopped by the U.S. laws. And this is one of the reasons why I am such a fervent evangelist of proactive affiliate program management.