Thinking of playing some blackhat games like “cookie stuffing”? Think again. It’s a criminal activity that could land you in jail.
Back in August 2008, eBay filed a civil suit against 4 affiliates, alleging fraud, racketeering activity, wire fraud and unauthorized access of eBay’s servers.
Following an investigation by the FBI’s Cyber Crimes Department, 2 indictments were handed down against two of the affiliates, on June 24, 2010. They were charged with wire fraud and criminal forfeiture. The affiliates appeared before the court on July 22, 2010 and plead not guilty. They were released on $100,000 property bonds and had to surrender their passports.
Sound scarey?
Well, it gets worse. The maximum penalties they can face if found guilty is:
- Imprisonment of 20 years
- Maximum fine of $250,000 or twice the gross gain/loss (whichever is greater)
- 3 years of supervised release
- $100 special assessment (per count)
To find out who the affiliates are and other particulars about this case, read Kellie Stevens report on this matter over at Revenews
About Rosalind Gardner
Rosalind,
You rarely hear about these stories in the blogosphere. I appreciate all your insights and information about the legal side of affiliate/internet marketing. A much needed reminder that we have a real business that deals with real people and their money.
Keisha
I read about that on the warrior forum. I still really don’t understand what all is involved with cookie stuffing so I think I’m safe.
Hi Rosalind
I hadn’t heard of cookie stuffing so I looked it up. That explains why I’m not getting any commissions, all my affiliate cookies are being overwritten by cookie stuffing sites
Seriously though, it is annoying that you do everything by the book and these people could potentially be taking your affiliate sales.
They should get prison, it is stealing when all said and done.
Your HoT VA
Chris
It’s an interesting test case because at what point in the process does dropping the cookie become fraud?
Obviously dropping random cookies on all site vistors to general forums (as in the cases described here) is a directly fraudulant activity, but the fact that two of the affiliates were NOT charged indicates they may have been dropping cookies in more ‘legitimate’ ways (e.g. on pages directly related to the products concerned).
Up until last year one well-known marketer was dropping multiple cookies on his pages, and there was a lot of discussion on the forums about it when Clickbank seemed to be having issues concerning carrying over affiliate details.
eBay was always the most profitable cookie stuffing activity (like 75% of all stuffing so I’ve heard) so no surprise they’ve taken the lead on this. With all the technology to be described in court this is going to be an interesting case and the outcome is by no means certain (they weren’t even sure initially what laws to use to prosecute under). If prosecutions do result from it, what next – cloaked pages, cloaked links, redirects? The possibilities for fun and games with the authorities are endless.
Shocking! I heard of cookie stuffing before, but did not know what it was until now. These guys made a lot of money in a short time. I am very curious to see how this unravels and if this has implications for the whole industry.
Thanks for the update on this, Ros. I’ve been wondering what came of that suit, but never really made the time to Google around for it.
-JTS
As a total newbie, I ask is this cookie stuffing something that could be done accidentally or is it a hacker-type maneuver which could never be accidentally performed as an honest mistake? Nothing is worth going to jail for. Still, it’s impressive the money generated by this group.
These people mess it up for the rest of us! For those who come home from work at God know what hour then work on our e-projects until we just can’t keep our eyes open.
No wonder affiliate marketers aren’t well looked upon in certain circles!
That’s why that as affiliates we must work twice as hard to come up with quality content and get exceedingly creative when designing promotions and adding value above and beyond our merchants’ products.
I say they get what they’ve got coming.
To answer DrDUTVOL’s question, no this is not something you can do by mistake. If you don’t know how to do it, just keep it that way. You have nothing to worry about because you are completely innocent.
In addition to the important warning against “cookie stuffing”, you provided an valuable educational resource, RAVENEWS — two excellent reasons to continue reading Net Profits Today.
While I generally agree (98%) with Pat’s statement, I’d like to offer a small story from when I was an affiliate marketing newbie several years ago and DID honestly, accidentally engage in cookie stuffing for a few days.
I was using a pop-under service. They had agreements with various websites to display a pop-under to visitors of those sites – a small browser window that appeared beneath the main window, often coming into view unobtrusively only when the visitor was done browsing their intended website. For the impressions that I bought, I had my merchant’s offer/ad placed in the pop-under, of course with my affiliate link, and some people clicked through on occasion. Cool.
But then I got “smart”. I thought “Why place the ad there? Why not skip a step and just have the pop-under go directly to my merchant’s site through my affiliate link? My merchant only pays out to me when people buy, so what’s the harm?”. The user would see the merchant’s landing page in the pop-under – via my link/cookie. Well, I gave this a shot, and it turned out to be moderately profitable. Being new to affiliate marketing, any amount of money seemed like good money, so I then began getting nervous – a red flag went up in my mind, and I thought “Gosh, this was too easy. Am I doing everything right here?”
I then had a closer look at the merchant’s Terms of Service, and lo and behold, it looked like I might be violating a term about requiring the user engage in an affirmative action (typically a mouse click) before sending them through my affiliate link and dropping a cookie. While I don’t think cookie stuffing was a phrase used often back then, the effect was the same – the user must click something before getting cookied.
Being an above-board marketer (and person), I immediately pulled the plug on what I was doing and pre-emptively contacted the affiliate network that managed my merchant’s account and explained my mistake. Since I got on it so quickly and did this proactively, they were very understanding and didn’t give me a hard time at all.
Anyway, just felt like sharing this story, as it’s an example of trying to be creative in marketing while staying clean – and accidentally crossing a line. But I agree with Pat that most of the time cookie stuffing occurs as a direct result of nefarious intent – hidden iframes, javascript tricks, cookies hidden behind images, etc.
More generally, (in life) even if you know you are completely innocent, it can help to be aware of your surroundings and the lay of the land, and know that sometimes honest mistakes can be misinterpreted as devious acts.
J
Hello “J”
Thank you so much for sharing your story.
I’ve made similar mistakes – not with cooking stuffing, but with email harvesting in 1997. Bought expensive software from a reputable company and thought what I was doing was above board – until my ISP shut me down for sending too many emails (200 was all it took). Wised me up up quickly to the possibility of losing my budding business, so like you, I’ve been white hat all the way since.
Cheers,
Ros
I can see clearly now, HA! Great story and a very nice share. Thank you and I stand corrected. A perfect example of how it could be done innocently.
The affiliate concerned has written a very interesting post over on his own forum about what happened http://blogs.digitalpoint.com/entry.php?b=215