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A Minnesota man considered one of the world’s most prolific e-mail spammers was indicted on more than a dozen federal charges related to the operation of his business, Xpress Pharmacy Direct.

The indictment against Christopher William Smith, 25, was unsealed on Wednesday after he was arrested at his home in Prior Lake. Dr Philip Mach, 47, of Franklin Park, New Jersey, and Bruce Jordan Lieberman, 45, from Farmingdale, New York, were also charged in the indictment, federal prosecutors said.

The grand jury alleged that Smith provided prescription drugs without making sure customers had a valid prescription. The orders were obtained through spam emails, internet sites and telemarketing.

The indictment contains various counts of conspiracy to dispense controlled substances, wire fraud, money laundering, distributing controlled substances and introducing misbranded drugs into interstate commerce.

Xpress Pharmacy generated millions of dollars. The indictment claims that from March 2004 to May 2005 the operation generated sales of more than $US20 million ($A26.42 million) from medications containing a single addictive painkiller, hydrodone.

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Smith appeared before US Magistrate Judge Janie Mayeron, who ordered him held without bond. An arraignment and detention hearing has been scheduled for Friday US time.

Smith’s attorney, Joe Friedberg, did not immediately return a telephone call seeking comment.

The Spamhaus Project, an international anti-spam organisation based in the United Kingdom, considered Smith one of the world’s worst offenders.

In May, a federal judge shut down Xpress Pharmacy and appointed a receiver to take control of the business’ assets. Federal authorities seized $US1.8 million in luxury cars, two homes and $US1.3 million in cash.

Prosecutors allege Smith had Mach issue about 72,000 prescriptions from July 2004 to about May 2005. Mach is registered to practice medicine in New Jersey, but allegedly wrote prescriptions for patients throughout the United States and without having any contact with patients or with their primary care doctors.

The US Attorney’s Office said Mach was represented by Bruce Levy of New Jersey. A call to his office was not immediately returned.

Lieberman, Smith’s former accountant, was accused of helping Smith hide the origin of money earned from the prescription drug business. Lieberman also allegedly helped Smith process credit cards.

Marvin Zevin, Lieberman’s attorney, declined to comment until his client had made his first court appearance.

Christopher Smith’s neighbours didn’t know exactly what he did for a living. But they knew well that he liked to collect expensive cars and set off fireworks at all hours.

At an age when most of his peers could barely afford a new car, Smith was amassing a collection that would include BMWs, Hummers, a Ferrari, a Jaguar and a Lamborghini. And when other 20-somethings were trying to save for down payments on modest starter homes, Smith paid $US1.1 million ($A1.45 million) for a house in a more affluent suburb.

Smith got all that through his successes in massive unsolicited email marketing, authorities say. The Spamhaus Project, an anti-spam group, considered him one of the world’s worst offenders.

He was just 25 when the feds in May shut down his flagship company, Xpress Pharmacy Direct, and seized $US1.8 million in luxury cars, two homes and $US1.3 million in cash held by Smith and associates.

But even then, prosecutors say, he refused to give up.

They say he tried to relaunch his online pharmacy from an offshore haven - the Dominican Republic - intending to build his business back up to $US4.1 million in sales by its second month, right where it was before.

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Brian McWilliams, author of Spam Kings, said young people like Smith weren’t unusual in the fast-buck world of spammers.

“A lot of them are guys who haven’t had success anywhere else in life but they find this easy money to be made in the spam trade,” he said. “They don’t want to give it up.”

Authorities were waiting when Smith flew back to Minneapolis in late June.

Smith was indicted on Wednesday more than a dozen federal charges.

The high school dropout, operating under the nickname Rizler, got his start in the late 1990s, selling police radar and laser jammers. Along the way he added cable TV descramblers and other products.

The high school dropout, operating under the nickname Rizler, got his start in the late 1990s, selling police radar and laser jammers. Along the way he added cable TV descramblers and other products.

After Time Warner Cable got an injunction in 2002 putting Smith out of the descrambler business, he diversified and generated more than $US18 million in sales from drugs online, including the often-abused narcotic painkiller Vicodin, without obtaining proper prescriptions, federal prosecutors say.

Smith’s former neighbours in a hilly, heavily wooded part of Burnsville were glad to see him go after he moved to pricier, more secluded digs in Prior Lake over the winter.

Sue Parson said things began to get out of hand in May 2004. When her husband complained about loud fireworks, she said, Smith’s response was: “Too bad. We can set them off if we want to.” Not long after one complaint, someone set off fireworks at the foot of the Parsons’ driveway early one morning, she said.

Neighbours didn’t know exactly what Smith did for a living. Parson said he told one person he had a lawn service, another that he was “into computers” and yet another that he was “into pharmaceuticals.”

“There were these Hummers outside, the limos outside,” she said. “It was like, ‘Where do these people get their money from?’”

Just four days after a federal judge put Xpress Pharmacy Direct into receivership, Smith made what prosecutors say was a brazen play to stay in business.

He took off for the Dominican Republic and went to work setting up a new online pharmacy and call centre, where prosecutors say he hoped he would be safe from extradition and out of the reach of the US Drug Enforcement Administration.

Former employees, his wife and even his girlfriend brought or sent Smith “substantial sums of cash” there, and one former employee passed him a disk with data on more than 100,000 Xpress Pharmacy customers, court documents and testimony allege.

Smith even managed to withdraw some money from an account that was supposed to be frozen. He also launched two new websites, the documents allege.

In the Dominican Republic, Smith was a guest of Creaghan Harry, a man the government described as another notorious spammer.

According to the court documents, Harry, who runs a call centre there, earned more than $US2 million from Smith for telemarketing.

Harry said the call centre he manages, Santo Domingo-based Americas Best Worldwide, was just one of many that took orders for Smith. He said it had no other connection with Smith’s new business.

“We basically got pulled in to this because Chris Smith decided to come down here,” Harry said. “But we are not his company or even his call center. Taking pharmaceutical orders is only a small part of our business.”

Harry acknowledged that Smith had stayed in his Santo Domingo apartment for a week in early June, but then left for a beach resort in Boca Chica, outside Santo Domingo, where he took up scuba diving. He then went to the eastern island resort town of Punta Cana, Harry said.

“It just seemed Chris was on vacation,” he said.

Though Smith mentioned over a few lunches in Santo Domingo that he planned to start up a new business, he didn’t offer details, Harry said.

Whether it was a business trip or vacation, it ended with Smith going straight to jail when he returned to Minnesota.

Authorities arrested him on a contempt-of-court warrant and said in court last month they planned to seek unspecified criminal charges against him. Assistant US Attorney Nicole Engisch told US District Judge Michael Davis a grand jury had been hearing evidence against Smith and others she did not name. She said she did not know when indictments might come down, nor did she say what the charges might be.

Smith and his stepfather declined to comment on his legal troubles as he left the courthouse the next day after his release on $US50,000 bail. Prosecutors also declined to comment on the case, citing the ongoing investigation.

Smith’s father, Scott Smith, declined to comment for this story after initially agreeing to talk. In an earlier interview with the Star Tribune, he portrayed his son as a business genius who dropped out of high school because he was bored.

“That spamming stuff they talk about, sometimes Chris may have been a middleman helping other business people, but he never broke the law. I’m sure of it,” Scott Smith told the newspaper.

As Smith sat in Davis’ courtroom, wearing orange jail garb and flashing an occasional forlorn smile at his father and wife, high-profile local defence lawyer Joe Friedberg conceded that Smith had violated the judge’s May 20 injunction by taking $US2000 from a frozen account.

But Friedberg contends the government hasn’t proved that anything else Smith did in the Dominican Republic was illegal.

As Davis freed Smith on bail, he put him on home monitoring and ordered him to surrender his passports.

And Davis admonished Smith: Stay away from computers and don’t set up any more websites.

One of the world’s most prolific spammers has been arrested in the US as he stepped off a plane from the Dominican Republic, where he had been holed up running his illegal operation.

Christopher Smith, originally from Minnesota, has moved his operation around the world to locations such as China and Malaysia, according to anti-spam campaign group Spamhaus. Earlier this year US authorities seized assets from Smith and shut down one of his businesses which was illegally selling pharmaceuticals online.

According to Steve Linford from Spamhaus, who traces the movements of the world’s worst spammers, Smith then went on the run with a fake passport.

During this time Spamhaus was in contact with the FBI, sharing information on Smith’s movements and activities. Spamhaus was notified by the FBI about Smith’s plans to return to the US and Smith was arrested late last week as he stepped off the plane in Minneapolis.

According to Linford, Smith was a particularly prolific spammer.

“He was well up in our top 10,” Linford said. But it was his decision to the return to the US which was his undoing.

“It seems that he must have forgotten something and came back but really I think he was just incredibly stupid,” said Linford.

Last week’s arrest was related to Smith skipping bail and travelling with forged documents, following his initial arrest for illegally selling pharmaceuticals. But Linford isn’t too worried that the arrest did not take into account Smith’s spamming, as long as he is now out of the picture.

“Behind bars is behind bars,” Linford said.

Unsurprisingly, given the close tabs the organisation kept on him, Smith also had a particular axe to grind with Spamhaus.

“At one point he even tried to register the domain Spamhaus.org.uk and offer spam services from it in an attempt to damage our reputation,” Linford said.