A company that allegedly scared users into buying its software by offering to eradicate nonexistent spyware has been ordered to cease and desist by a U.S. court, the Federal Trade Commission said Friday.
The FTC filed against Spokane, Wash.-based MaxTheater and its principal, Thomas Delanoy, to stop the company from touting SpyWareAssassin through bogus "scans" claiming the user's PC was infected with spyware.

According to the FTC, which was awarded a temporary restraining order by a U.S. District Court on Friday, SpyWareAssassin used Web sites, banner ads, and popups to drive traffic to its Web site where the company warned "...you WILL eventually experience credit card and/or identity theft and your computer will crash and cease working for good."

The Web site then offered to scan the user's PC for spyware. Inevitably, the scan would find copious amounts of malicious software because, said the FTC in a statement, the "free remote scan is phony, and the defendants' representations that they have detected spyware on the consumer's computer are deceptive."

In fact, the scans would come back positive even on clean PCs that had no evidence of spyware, alleged the FTC.

The software SpyWareAssassin sells for $30 claims to remove "all spyware programs and files" and "prevent any future breaches." The truth is different, said the FTC, which alleged that the software doesn't remove all or even substantially all, spyware.

The FTC added that it would seek a permanent injunction against MaxTheater, as well as some sort of compensation for consumers fooled by the company's claims.