Performance Marketing Insider has been covering the case of Shawn Hogan and Brian Dunning since the case was first launched a few years ago. Every step of the way his supporters have come out saying that he wasn’t guilty, that he was set up. Now, as you may have read in PMI, both Shawn Hogan and Brian Dunning plead guilty and look like they are going to spend some time in jail meeting new friends. Strangely enough some of his supporters are asking why is what he doing illegal and incorrectly arguing that it was only some sort of “Affiliate agreement violation.”
Perhaps that’s part of the issue here: the weird belief that defrauding affiliate programs is nothing more than a “trick” and isn’t really a bad thing, let alone illegal.
Let’s first address that: Any type of method to “trick” an affiliate program is fraud. Affiliate programs are made specifically to pay you for a legit way of generating leads, sales, conversions, downloads or whatever.
There are tons of people generating real conversions and running a legit business, following the rules, and not breaking the law. If you are one of those people who run affiliate programs with the purpose of breaking their rules and defrauding the affiliate program or network, you are part of the problem. There is no excuse for anyone to do this because its been made clear through article after article both in numerous publications and blogs that this is not acceptable.
As mentioned, many people just think that it’s just a violation of some agreement, and not illegal. The laws are changing and many more laws are on the book addressing these issues more specifically in order to ensure that there is no wiggle room. However, there are also many many laws already on the book for some time that address these issues: specifically federal wire fraud laws. Basically, if you do anything fraudulent, receive funds for it, whether by check, wire or pretty much any method that crosses State lines or uses a bank, you are breaking the law.
For those who don’t get it, read it again. Wire Fraud is a very wide-sweeping principle that has been used to catch everyone from major organized crime lords to Shawn Hogan. Simply put it is used to prosecute anyone who creates a scheme for the purpose to obtain money based on false representation or promises and then uses some sort of electronic communications.
What does this mean for affiliates? If you are purposely breaking an affiliate agreement, creating a scheme to defraud a network, a program and they can prove that you did it on purpose: you are breaking the law. The case against Shawn Hogan and Brian Dunning was prosecuted by the Department of Justice in order to send a very clear message to the bad guys in the Internet Marketing Community: we are watching you and we will take down even the very best of you.
What makes this case even more interesting is that both Brian Dunning and Shawn Hogan thought they got away with it. It was at least 4-5 years before they were prosecuted. This is how federal cases often work: it takes years to get to them, and often they collect as much evidence as possible before even arresting or raiding the people involved. So if you think you’ve somehow gotten away with an affiliate fraud crime, consider that you may already be the target of an investigation.
Affiliate Fraud is a Crime. Period.
Find Affiliate Fraud Solutions at CPADetective & Scrubkit.
Don’t run a network without one of them.
