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Attorney General Lockyer Files Consumer Fraud Lawsuit against Alyon Technologies

Complaint Charges Illegal Dialing Programs Loads Without Consumer's Knowledge
Thursday, May 15, 2003
Contact: (415) 703-5837

(SACRAMENTO) – Attorney General Bill Lockyer today filed a consumer protection lawsuit against Alyon Technologies Inc. and its chief executive officer over software the company provides that installs, via pop-up ads and other methods, a program that automatically dials expensive adult sites without the computer owner's knowledge, and makes adult material easily accessible to children.

"We've received dozens of complaints from consumers who couldn't understand why their phone bills exploded just because they tried to close a pop-up ad," Lockyer said. "Now we know why. Alyon used deception and technology to bilk consumers and deprive parents of the ability to protect their children from harmful matter on the Internet."

The Attorney General's complaint seeks an injunction to permanently halt the improper use of Alyon's Internet dialing software, refunds for consumers who paid bills based on Alyon's improper use of their Internet dialing software and civil penalties of $2 million.

In addition to Lockyer's lawsuit, filed in San Diego Superior Court, the Federal Trade Commission and 18 other states also are taking legal action against the New Jersey-based Internet billing company.

Alyon sells its software mostly to adult content sites that often advertise with pop-up ads on chat rooms and other sites that are popular with teenagers. When the viewer clicks on an ad, he or she is linked to the adult site and given the option to view the adult content without having to use a credit card to access the site.

If a consumer chooses that option, Alyon's Internet dialing program loads a dialing software program onto the computer, which disconnects the computer from its usual Internet Service Provider (ISP) and connects the consumer's computer to the Internet through a long distance call to a New Jersey 201 area code number. The software charges the consumer $4.99 a minute for each minute that the consumer's computer is attached to the Internet. The dialer software captures the telephone number of the computer from which the call is placed and charges the line subscriber for the number of minutes that the computer is connected to the Internet.

In some cases, the automatic dialing program is downloaded – without the consumer's consent or knowledge – when a consumer tries to close the pop-up ad.

The program allows minors to gain access to adult material in two ways. Because Alyon's software program bills the owner of a phone line and a credit card is not needed, minors are able to access adult content sites without age verification. Once the program is on the computer, parents also are unable to use systems that block calls to 900 and 976 pay-per-call telephone numbers because the consumer's computers are dialing a 201 area code number, not a 900 or 976 area code.

The Attorney General's complaint alleges that consumers report that they have unintentionally downloaded Alyon's dialing software, are receiving bills for computer calls made when no one was home to use the computer and are receiving bills for calls charged to a phone number that is not theirs. Some consumers also have complained that they cannot remove the program once it is loaded on their computer.

The complaint further charges that Alyon has engaged in unfair business practices when attempting to collect amounts supposedly owed by consumers. The company and its chief executive officer, Stephane Touboul, also are charged with making false and misleading statements to consumers.

The Attorney General said he also wants Alyon to provide more effective instructions on how consumer can remove the dialer program without damaging their computers. Numerous consumers said they were unsuccessful in removing the dialer program even after following instructions posted on Alyon's website. Because the program is downloaded into the computer's registry, it becomes part of the computer's booting process and returns when the computer is rebooted even when a consumer deletes the shortcut icon from their desktop. Consumers must clean or edit their computer's registry to completely remove the program.

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03-057.pdf88.87 KB

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