A Minnesota man who tried to defraud PayPal customers through a phishing scam has pleaded guilty to wire fraud.

Alec Scott Papierniak, 20, of Mankato in Minnesota, also admitted using viral code to further his fraudulent activities at an appearance in a federal court in San Jose on Tuesday.

Papierniak was able to siphon money from online accounts after he tricked users into handing over their user names and passwords via bogus security alerts. These bogus alerts directed users to a maliciously constructed Web site run by Papierniak, instead of the genuine PayPal site.

In pleading guilty, Papierniak also admitted to emailing a "key logger" virus to PayPal users, again with theft in mind. Both MiMail-I and MiMail-J fit the bill, but we're not certain if either virus was involved in this case.

The 20 year-old ran the scams for nearly two years until he was caught in September 2003. Papierniak, who admits stealing in excess of $30,000 during that time, has agreed to pay restitution to his victims.

A DoJ statement on the case omits details of how Papierniak was tracked down, beyond saying it was the result of an FBI investigation. If a member of the public was involved we’d be very disappointed if Microsoft didn’t stump up a substantial reward as part of its Anti-Virus Reward Program.

Papierniak pleaded guilty to a specimen charge involving theft of $10,000 from one account and is scheduled to return for sentencing by US District Judge James Ware on May 10. Wire fraud is punishable by up to 20 years imprisonment but Papierniak's guilty plea will go some way towards reducing the severity of his sentence. ®