Two Florida mortgage spam scam operators agreed Wednesday to post $1 million bonds before sending any more unsolicited commercial e-mail as part of a settlement deal with the Federal Trade Commission (FTC).

The bonds are to guarantee the two will not engage in any further misrepresentations in the advertising or sales of any goods or services on the Internet, particularly in the area of residential mortgages.

The settlements also bar the defendants from using or benefiting from personal information that was deceptively collected from consumers.


In January, the FTC filed a complaint in U.S. District court charging that 30 Minute Mortgage Inc. sent spam and maintained Web sites where it advertised "3.95% 30 Year Mortgages" and described itself as a "national mortgage lender." The FTC charged that the company urged potential customers to complete detailed online loan applications that included such information as social security numbers, income and assets.

The company assured consumers that their sensitive information would be protected because it would be transmitted using Secure Sockets Layer (SSL) technology.

The FTC claimed 30 Minute Mortgage was not a national mortgage lender and did not offer the loans it advertised. Instead, the company allegedly sold or offered to sell thousands of completed applications to nonaffiliated third parties without consumers' consent.

The FTC also claimed that consumers' sensitive personal and financial information was not protected in transmission because the Web sites at times did not use SSL or other encryption technology.

The FTC charged 30 Minute Mortgage, its president Gregory P. Roth, and its former national sales director Peter W. Stolz, with violating the FTC Act, the Truth in Lending Act, and the Gramm-Leach-Bliley Act. The FTC asked the court to bar the illegal practices permanently and order the defendants to give up their ill-gotten gains. The judgments announced Wednesday end that litigation.

Based on financial disclosures provided by Roth to the FTC, a $57,500 judgment against Roth has been suspended. According to FTC, the stipulated final judgments and orders do not constitute an admission of guilty by Roth and Stolz.