Rented Computers Caught Spying on Customers

The Federal Trade Commission has reached a settlement with DesignerWare Corporation and numerous computer rental companies for installing software on rented computers which secretly snapped explicit webcam pictures, captured emails and a variety of other personal information, including Social Security Numbers, medical and bank account information from thousands of users.

The companies installed a surveillance program called 'PC Rental Agent' which according to the FTC, "can also cause a computer’s webcam to surreptitiously photograph not only the computer user, but also anyone else within view of the camera. In numerous instances, ... webcam activations have taken pictures of children, individuals not fully clothed, and couples engaged in sexual activities."

The software, which is undetectable and uninstallable by the user, has been installed on nearly half a million computers and has been distributed by 1,617 computer rental companies in the US, Canada and Australia.

According to the complaint, "PC Rental Agent, when installed on a rented computer, offers rent-to-own store licensees the ability to direct DesignerWare’s servers to disable a computer remotely when a consumer is late making payments, has stopped communicating with the rent-to-own store, or has otherwise violated the rental contract."

The software also contains an option for the rental company to turn on "Detective Mode" which, again quoting from the complaint, "Once installed and activated, Detective Mode can log the keystrokes of the computer user, take screen shots of the computer user’s activities on the computer, and photograph anyone within view of the computer’s webcam." DesignerWare collects this information and transmits it, unencrypted, to the computer rental company.

PC Rental Agent also secretly tracked users by logging public wifi networks the computer used to access the internet, which "employees of the rent-to-own stores ...can monitor their physical locations and the patterns of their movements."

The FTC settlement requires rent-to-own companies to stop using monitoring software or tracking users' locations without knowledge or consent. The companies cannot used illicitly gained information to collect customer debts and the FTC will monitor them for 20 years.

The following companies are named in the complaint:
DesignerWare, LLC; its principals, Timothy Kelly and Ronald P. Koller, individually and as officers of DesignerWare, LLC.; Aspen Way Enterprises, Inc.; Watershed Development Corp.; Showplace, Inc., d/b/a Showplace Rent-to-Own; J.A.G. Rents, LLC, d/b/a ColorTyme; Red Zone, Inc., d/b/a ColorTyme; B. Stamper Enterprises, Inc., d/b/a Premier Rental Purchase; and C.A.L.M. Ventures, Inc., d/b/a Premier Rental Purchase.

First published on Technorati as "Rented Computers Caught Spying on Customers"