This poll hit the interactive Wall Street Journal
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Silicon Investor Puts the Fate
Of Banned User Up for Vote
By CARRIE LEE
THE WALL STREET JOURNAL INTERACTIVE EDITION
Anthony Elgindy, a short seller who was kicked off the Silicon Investor Web site because of his controversial postings, may be making a return. The site is putting his fate up for a vote of its 150,000 members.
The stock-discussion site (www.techstocks.com) launched the unusual maneuver earlier this week in a posting to its members. It invited users to discuss the merits of readmitting Mr. Elgindy and to cast a vote by midnight Friday by sending a private electronic message to the site.
"If this works well, and it's something that members seem to enjoy, then we'll consider a similar 'community appeals' process" for other users who are banned from the site," said Bryan Burdick, managing director of the site, in the posting announcing the vote. Each month, about five subscribers are booted from the $10-a-month service, which is owned by Go2Net of Seattle.
Silicon Investor's users have mixed views of the vote, which would in some ways allows a popularity contest to overrule the site's "terms of use" agreement, a set of rules imposed on users to, among other things, weed out abusive and promotional message-board postings.
"I don't think a vote is necessary. ... His method of operation should not be allowed. He's self serving," says Silicon Investor member Frank Rivera. Mr. Rivera, of Portland, Ore., has been a member since 1997.
Mr. Burdick, in an interview, said that winning his membership back in this week's vote won't excuse Mr. Elgindy from any terms of the user agreement. "[A member] will still be subject to the terms of use. If we should continue to use a voting mechanism, this is somebody's last chance. There's no second vote," he says.
Although he has detractors, Mr. Elgindy had been a popular figure on Silicon Investor, and Mr. Burdick says he has fielded a barrage of complaints since Mr. Elgindy was banned in late August. Before being banned, Mr. Elgindy was active on the boards, often posting scathing comments about companies whose shares, he believed, were being lifted by hype.
Support for Mr. Elgindy is evident on the message-board that was set up to discuss his fate. A review of the first 100 messages posted there show that individuals in favor of reinstating his membership outnumber people opposed by roughly 3 to 1. However, most of those postings center on the merits of holding a vote at all, or -- as message-board conversations tend to go -- are unrelated to the topic at hand.
Mr. Elgindy, 31 years old, of Del Mar, Calif., had long sought to cast himself as a watchdog on online promotion while at the same time making no secret of the fact that he aimed to profit by short-selling shares of the companies he had taken on. Short sellers borrow shares in hopes of profiting by repurchasing shares later at a lower cost to repay their loans.
Silicon Investor users earlier this year made Mr. Elgindy's online alias -- Anthony@Pacific -- among the most "bookmarked" names. (The site allows its users to use so-called bookmarks to keep track of the postings of specific message-board participants.) This week, the discussion about whether to bring back Mr. Elgindy has been Silicon Investor's most heavily used boards. More than 680 messages have been posted since Tuesday.
Other popular stock-discussion sites also revoke the rights of users who violate their terms-of-use agreements. Yahoo! Finance (quote.yahoo.com) and Raging Bull (www.ragingbull.com) say they have never turned to a membership vote to allow a banned individual to return.
Blake A. Bell, a New York attorney who specializes in Internet law, says the voting concept has flaws. "I can't think of a less scientific poll. Are you likely to get the entire community's view?" he says. "It's certainly going to apply on a case-by-case basis. Where does the company draw the line?"
Mr. Burdick won't say specifically what caused the site to ban Mr. Elgindy and his wife, Mary, from the service. "Some [violations] sort of mount up over time, like spams, personal attacks, promoting other sites," he says. "That was more the case with Anthony."
Mr. Elgindy says, "The exact words were I violated the terms of use by advertising my [personal] site, which many people do on Silicon Investor, and by attacking certain people because they were targets of one of my trades. I'm so outspoken, I was at one point attacking Silicon Investor. ... It was the heat of the moment, I overstepped some boundaries."
Mr. Burdick says Mr. Elgindy contacted him about two weeks ago and asked whether there was an opportunity to reconcile their differences. "He's a very reasonable, rational guy," says Mr. Burdick. "We had good conversations. He understood why we did what we did."
Mr. Elgindy joined Silicon Investor in August 1998, and started his own message board, "Anthony@Equity Investigations, Dear Anthony," last November. Although his membership was canceled, and his ability to post messages revoked, Mr. Elgindy's message board remains accessible and actively used. His old postings remain on Silicon Investor, as does his user profile, which includes a link to his personal site (www.anthonypacific.com).
Mr. Elgindy came to Internet stock trading after a decade as a licensed securities broker. In the early 1990s, he was co-owner of a small, now-defunct San Diego brokerage firm that came under federal criminal investigation in connection with illegal stock trading. The investigation led to several convictions. Mr. Elgindy has said that he didn't know about any illegal activity and was never charged. In a court hearing, the federal prosecutor on the case acknowledged Mr. Elgindy's cooperation.
In 1997, the National Association of Securities Dealers, which regulates brokers, suspended Mr. Elgindy for up to a year from various brokerage activities and assessed him $30,000 for 1993 stock-trading violations that included improperly using a trading system set up for retail customers. Mr. Elgindy says his trading violations were inadvertent and came at a time when he was depressed by the criminal investigation involving his firm. Last year, Mr. Elgindy decided to leave the securities industry.
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Write to Carrie Lee at carrie.lee@wsj.com.
Copyright ¸ 1999 Dow Jones & Company, Inc. All Rights Reserved.
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