The term spyware is used to describe any computer technology that gathers information about a person or organization without their knowledge or consent. Spyware can be installed on a computer through several covert means, including as part of a software virus or as the result of adding a new program.

Note that the terms spyware, stealware, computer spy, and adware are sometimes used to describe the same or similar types of malicious code. Several states, including Utah, Iowa, California, and New York, are working on legislation to ban or control spyware. In addition, the U.S. Congress is also considering new laws.

Spyware is used to gather information such as recorded keystrokes (passwords), a list of Web sites visited by the user, or applications and operating systems that are installed on the computer. Spyware can also collect names, credit card numbers, and other personal information.

It is usually placed on a computer to gather information about a user that is later sold to advertisers and other interested parties. The information gathered by spyware or computer spy is often combined with other databases to create profiles of individuals, families, work groups, or even entire companies.

Such profiles are mainly used for direct marketing purposes. Figure below illustrates how spyware typically works.

Stealware is another name often associated with Web bugs or spyware/computer spy. It is often used by Web sites that have various types of affiliate marketing programs or that are members of affiliate marketing plans. Some peer-to-peer software applications are reported to have stealware attributes.

Note that the terms spyware, stealware, and adware are sometimes used to describe the same or similar types of malicious code. One stealware scam that consumers have complained about to the Federal Communications Commission (FCC) is that they have been billed for international calls that occurred as a result of using local Internet service providers to access Web sites.

Some Web sites encourage computer users to download software in order to view certain material. Unknown to that user, the downloaded software disconnects his or her computer’s modem and then reconnects it using an international long-distance number.

The result is that the modem may actually be placing a call to as far away as Chad, Madagascar, or other countries, and the computer user may be billed for an international call. Some Web sites may be advertised as free and uncensored or may allow information to be downloaded.

However, a pop-up window with a disclaimer should appear. The disclaimer usually reveals information on possible charges or rerouting of the Web site. It may say: “You will be disconnected from your local Internet access number and reconnected to an international location.”

It is important that computer users read the disclaimer to learn what charges will be assessed before they click the box. If they still choose to download, users should be prepared to receive a phone bill with high international toll charges. There may also be charges from a nontelecommunications company that provides a billing service to the Web site in question.