Many of us use formmail.pl in our servers.
Widely used FormMail.pl Web-to-Email CGI Script Allows Unauthorized Users to Send Mail (e.g., spam) Anonymously. - March 16, 2001
For a full description see
http://securitytracker.com/alerts/2001/Mar/1001108.html
A patched version of this script with the anti-spam fix is available at
http://www.mailvalley.com/formmail/
The modified version of this formmail perl script, allows you to specify a list of recipients in a text file, who are authorized to receive emails. So the script will only send mail to addresses listed in this file thus providing spam protection.
Hope this information will be of use to webmasters and webhosting providers.
If anyone has a different solution to this problem, let me know.