Classic hustler caught in net scam

By ABIGAIL GOLDMAN
Las Vegas Sun
Wednesday, September 12, 2007

Call it a modern interpretation of a classic hustle: Rather than stick up someone in a dark alley for his wallet, David Scali threatened strangers via e-mail for their Web sites.

Fork over that Internet address or I'll bust your virtual kneecaps.

From his home in Las Vegas, Scali, 28, posing as a Los Angeles intellectual property lawyer, sent e-mails to the owners of several Web sites and threatened them with a $100,000 trademark infringement lawsuit unless they gave up their Internet properties within 48 hours.

At least one person took the bait.

Scali, who agreed to plead guilty to wire fraud in a Los Angeles court last week, planned to acquire the forfeited Web sites and use them for his own gain.

Assistant U.S. Attorney Wesley Hsu, who specializes in cyber and intellectual property crimes, would not name the targeted Web sites nor say how Scali planned to make money off them, although court documents indicate Scali was targeting Web sites with addresses similar to popular sites.

There's money in owning an Internet address that's similar to, but not quite the same, as a popular Web site. Say, with an extra "s" or a hyphen, Florida attorney and law professor Marc John Randazza said.

Called "cybersquatting," slightly different versions of well-known Web sites can siphon 10 percent to 15 percent of Internet traffic from the site being faked, according to Randazza, who specializes in intellectual property law.

Once the cybersquatter has diverted traffic, he can profit off Internet users who click on ads posted on the bogus Web site, Randazza said.

"You will find that as domain name speculation becomes a bigger and bigger business, you are looking at a shrinking group of valuable domain names," Randazza said. "People are going to do shadier things to seize them."

On the shady scale, Randazza said Scali's attempt to bully people out of their Web sites registered "black." The worst.

Randazza said it is unlikely any reputable attorney would send business e-mails from the address Scale was using: trademarkinfringement(at)netzero.net.

It's not the first time Scali has found himself in financial trouble. In 2003, while busing tables at the Aladdin, he filed for bankruptcy, largely because of credit card debt .

Attempts to reach Scali were unsuccessful. Relatives contacted said they were unaware of the wire fraud case. After Scali plea, a judge could sentence him to a maximum of 20 years in prison.

Abigail Goldman can be reached at abigail.goldman(at)lasvegassun.com. For more stories visit scrippsnews.com