Alleged Spyware Mastermind, Buyers of the Program Indicted

A 25-year-old fugitive was indicted Friday for creating and marketing a software program called Loverspy that allowed buyers to snoop on former or prospective sweethearts by breaking into their computers.

Four people who bought the program -- available for $89 through a Texas website -- were also indicted and charged with unauthorized access to electronic communications.

Loverspy allowed its users to learn about the e-mails, website visits and passwords used on other people’s computers by sending an innocuous-looking electronic greeting card. Every keystroke on the victims’ computers was recorded.

The scheme involved sending a card under a phony name or a name that would not raise suspicion, according to Assistant U.S. Atty. Mitch Dembin. Once the card was opened, the victim’s computer privacy was compromised.

“It was marketed as a way to catch a cheating lover,” Dembin said.

Carlos Enrique Perez-Melara, a native of El Salvador and the alleged mastermind, is thought to be in Los Angeles, authorities said. He modified another program to create Loverspy, authorities said.

Buyers indicted Friday were John J. Gannito, 49, of Laguna Beach; Kevin Powell, 54, of Long Beach; Cheryl Ann Young, 40, of Ashland, Pa.; and Laura Selway, 34, of Irvine. Others have been charged in Charlotte, N.C.; Dallas; Honolulu; Kansas City, Mo.; and Houston.

More cases are possible, authorities said.

As many as 1,000 copies of Loverspy may have been sold worldwide and 2,000 computers victimized before the operation was shut down in October 2003 when the FBI raided Perez-Melara’s home in San Diego, Dembin said.

Perez-Melara faces 35 counts of manufacturing, sending and advertising a surreptitious interception device and unauthorized access to protected computers.

Loverspy buyers were allowed to send electronic greeting cards to as many as five e-mail addresses.

Once the program secretly installed itself onto the victims’ computers, it sent back periodic reports to the buyers. It could also be used to delete files or turn on Web cameras.

Acting Assistant Atty. Gen. John C. Richter said the case is one of the first criminal indictments against spyware computer software.

Spyware, Richter said, is “wreaking havoc online.”

While little-known to the general public, the Loverspy phenomenon caused a buzz among those in computer security. Companies have cited Loverspy as the reason computer users need anti-spyware and anti-virus software.

Loverspy, Dembin said, allowed spurned lovers to inquire about cheating hearts without “physical confrontation.”