There is justice in the world. Social network Tagged is getting their due punishment for sending out of millions of spam emails, abusing user email confidentiality, and baiting people to join their website.
The San Francisco company will pay 650,000 USD in civil penalties and costs relating to the investigation by the District Attorney’s office. This fee, which was a settlement, sets an important and stern precedent for any internet company looking to artificially raise their member count.
The company would take the email contact list of a new member, email their contacts claiming that the original user had sent them a message, or had done some action directed at them. The person would then be asked register for Tagged, which confused many, and then Tagged would harvest their contact list and continue spamming.
The company used this tactic to grow quickly on paper. But many of its claimed members (80 million) were never real users. They instead were people tricked into joining the website once and never returned in frustration after abuse from the company.
Tagged has raised some 13.7 million dollars, and claims to be profitable. The company can therefore afford this fee without risk of shutting down. Or, the settlement was not intended to terminate the company’s operations.
According to Compete, the company only reached 3.1 million people in the United States last month. After all their spamming, that is not a very impressive number.
The company has also agreed to cease the actions that led to its penalty. If you do use Tagged, you should have much stronger shielding of your email information.