January 10, 2014

Brian Dunning, explained

While I wait to see what sort of sentence convicted Internet fraudster Brian Dunning will get (in late April), I have just been reading Atlantic Monthly online about somebody much more brazen than him, even.

I strongly recommend this story about Jesse Willms, including and especially recommending it to Dunning's strongest defenders, if you want to understand the perils for the rest of us that are to be found in affiliate marketing, and why you should question his protestations of innocence.

Let's start here:
The downside to affiliate marketing is its astonishing rate of fraud. Because affiliates put up their own money to pay for ads pushing these products, they have a strong incentive to dupe consumers, so they can recoup their investment. If you’ve ever clicked an ad or a “sponsored link” about, say, a spectacularly effective new weight-loss scheme, which then leads you to a fake news article (or “farticle,” in the industry parlance) filled with sketchy scientific findings and constant entreaties to buy a product “risk free,” then condolences are in order: you’ve likely stumbled into some affiliate’s trap.
And, if Dunning used fake news articles for any of his cookie pushing, the irony and hypocrisy only grow. (Having never bought anything from him, and having only looked at his products on his own site, I don't know if he did or did not do anything like this.)

And, here's why you shouldn't believe theoretically reputable websites' claims to be fighting this.
And despite these companies’ frequent claims that they are actively weeding out affiliate links to potential scams, Web surfers rarely need to look hard to find evidence to the contrary. In 2009, for instance, an MSNBC.com story that called attention to the outbreak of fraudulent advertising featured an MSNBC.com vice president expressing zero tolerance for “fakeosphere” ads—yet as the affiliate-marketing and Internet-fraud expert Pace Lattin pointed out when I spoke with him in late 2012, those very ads continued to proliferate on MSNBC’s site
In some way, this is part of the dark side of the decline of traditional media; most Gnu Media gurus won't tell you that, that in some way, having more restricted editorial and ad space went some way toward guaranteeing a certain quality of advertising. But now, where we don't talk about "news" but we do talk about "content," this is the result.

The story goes on to describe how Willms used different brands of his fake medical products to set up different affiliate marketing streams. Result? This:
Even an hour of perusing Willms’s business tactics was enough to make me want to cut up my credit cards and retreat to a tribal society that barters with root vegetables.

None of this is to say that Dunning told the flat-out lies of Willms. Nor that he was much more than a medium-small fry in affiliate marketing practices compared to Willms, let alone doing the fine print credit card billing shystering, since his deception involved something far different -- skimming other affiliates' sales credits through use of online cookies.

It is to say that he had been hawking stuff on the Net long enough to know just how the shadier parts of affiliate marketing worked, while some subself inside his dura matter acted a tad less reprehensibly and a lot less brazenly than Willms.

That still doesn't excuse his criminality, and it certainly doesn't exclude his contribution toward polluting and degrading the Internet in general, and fostering the Lance Armstrong-type "everybody does it anyway" leitmotiv.

As to Willms? Steve Novella and other anti-medical quackery skeptics could do more good in trying to shut people like him down than Dr. Oz. Dr. Oz is a quack, but he's not a crook. Willms is technically not a crook, sadly only facing civil charges. Unless somebody charges him as an accessory to murder, if one of his products, as more and more supplements are doing, causes major liver damage.

How does all fo this happen, anyway? Because:
Regulatory authorities like the FTC are undermanned; courts seem reluctant to punish offenders; and worse yet, even the sheriffs we believe are imposing order online—Google, Yahoo, Microsoft—often end up providing scammers with a platform for deception.
And neither major political party is interested in changing it. The GOP is antiregulatory; Silicon Valley's libertarians who get the "cover" of Democratic neoliberalism fight it, too.

In more detail:
After reading through Jesse Willms’s online exploits, one perfectly reasonable reaction would be to cling ever tighter to the sites you trust—to vow never to stray from the seemingly safe paths laid out for us by Web gatekeepers like Google, Yahoo, and Microsoft. Since these companies have huge financial stakes in maintaining user faith, the thinking might go, they would surely never endanger that by doing business with potentially shady companies or affiliates. Right?

Well, no: the evidence shows that they, too, often work with unsavory advertisers—sometimes knowingly. In fact, the Harvard Business School professor Ben Edelman’s Web site houses a numbingly long list of cases in which trusted companies have sold ads for services they knew to be suspicious or fraudulent. Take Yahoo-owned Right Media: according to a 2009 analysis by Edelman, at least 35 percent of its inventory at the time consisted of deceptive ads ...

Or consider Google, whose famous motto, “Don’t be evil,” has not prevented it from engaging in suspect practices for the sake of ad sales. (Lest we forget, Google exists primarily to sell advertising; in 2012, 95 percent of its $46 billion in revenue came from selling ads.) According to court documents, Willms paid Google at least $1.7 million to advertise his various sites. And while the tech behemoth has often claimed that it couldn’t possibly monitor all of its advertisers’ practices—and thus shouldn’t be held liable for them—recent events have called this argument into question. In August 2011, for example, Google agreed to a $500 million forfeiture after a government sting revealed the company’s willingness to work with online pharmacies that were illegally selling prescription drugs. The investigation found not only that Google was aware these advertisers were breaking the law, but that its employees helped offenders prepare ads for prescription-free drug sales (reportedly including human growth hormone and the abortion drug RU-486) that would skirt Google’s own regulations.

Google has also been accused of profiting from so-called typo-squatters (who set up sham sites with misspelled URLs like twittter.com) and wittingly selling ads to companies offering counterfeit products. 
Having known personally, and distastefully, a typosquatter who's now in the Texas penal system on statutory rape charges and has been about as much a denialist about both that and his Net activity as Willms, I am disgusted more than ever at Google.

Back to the decline of old media. If one of my newspapers pulled this shit, and got caught at it, I'd personally be in the slammer, I have no doubt.

And (Update, Feb. 5, 2014) this godawful rapping attempt, combined with comments from Dunning worshipers justifying his stealing from "eBay" (no, he stole from other affiliate marketers) with a Kickstarter campaign. 

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