Scams & shams: The trouble with social networks

Social media cybersquatting is where domain name cybersquatting was 10 years ago, says James Carnall, manager of the cyberintelligence division at security monitoring firm Cyveillance Inc. People use variations on brand names to open accounts on social networking sites, in hopes that companies will pay them to relinquish control of the accounts.

He points to the online market Tweexchange as a prime example of how trading in social network names is a growing business. Unlike domain names, however, social networks have no central authority like ICANN or established processes for reclaiming brand names from cybersquatters.

Some impostors are simply overzealous fans, but Dienes-Middlen is more concerned about scammers and those who sell pirated videos and poor-quality knockoff WWE merchandise, which robs the company of revenue and cheapens its brands. Those sites lure users through social networks, spam, abusive search engine marketing and other channels. Last year, WWE shut down 3,200 online auctions of phony WWE products with an estimated street value of $16 million to $33 million.

During one Wrestlemania pay-per-view event this spring, WWE was able to use social networking sites to identify a number of unauthorized Web sites that planned to stream the event live. It also found 8,600 sites that had made pirated copies or footage of the event available after the fact. "Counterfeiting operations are highly organized, are very global and are picking up steam because of the economy," says Liz Miller, vice president of the Chief Marketing Officer (CMO) Council.

The Cost of Piracy