Porn king fined $2m in dating scam

A Brisbane internet pornography king has been fined $2 million in the Federal Court for his involvement in an SMS dating scam.

Scott Gregory Phillips, 35, faced civil legal action from the Australian Communications and Media Authority (ACMA) for breaching federal anti-spamming laws and the Trade Practices Act.

ACMA has successfully prosecuted three companies and four Brisbane men involved in the fake dating operation, which ran for three years and cost Australian phone users more than $4 million. Those prosecutions netted fines totalling $22 million.

Phillips was the only one to defend the allegations levelled against him but lost his court battle last month.

Justice John Logan imposed a $2 million penalty in the Federal Court in Brisbane on Wednesday to cover the breaches, which took place over 54 days between December 2005 and April 9, 2006.

The court heard backpackers were recruited to set up fake profiles on dating websites.

They were photographed and posed as people seeking legitimate relationships to harvest mobile phone numbers from dating site users.

These numbers were then fed into special software that sent premium SMS messages inviting people to use a secure SMS chat gateway called Safedivert at a cost of $5 per message.

The scheme sent thousands of messages and netted $140,000 in profit during Phillips' involvement, Justice Logan told the court.

"It was a systematic and studied deception of those who used internet dating websites; the end to which that deception directed was the (pursuit) of profit," he said.

He said the victims of the scheme had suffered not only financially but experienced "personal humiliation and embarrassment".

ACMA said some people had spent large sums on hotel rooms and gifts and waited at airports to meet dating matches who never arrived.

Justice Logan said it was important to send a strong message of deterrence.

The court heard that in the witness box, Phillips deliberately lied about his involvement and had not shown remorse.

Phillips' involvement in the scheme ended when he was jailed for an unrelated matter, the court was told.

The court was also told that one of his homes was used during the set-up phase of the scheme.

ACMA won costs but the amount is yet to be fixed.

Justice Logan also ordered Phillips be banned from setting up profiles on dating and social networking websites for seven years but allowed him personal use.

Phillips has 28 days to pay the penalty.

In October 2009, the Federal Court fined Mobilegate Ltd ($5 million), Winning Bid Pty Ltd ($3.5 million) and Simon Anthony Owen and Tarek Andreas Salcedo ($3 million each) and Glenn Christopher Maughan ($1.25 million).

In December 2009, the same court fined Jobspy Pty Ltd $4 million and Scott Mark Moles $2.5 million.

ACMA has since set up a spam reporting text message service: 0429 999 888. It can also be visited at www.spam.acma.gov.au.

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