One of the reasons I subscribe to the online WSJ is that they cover the SEC. For those who get the Online WSJ,
interactive.wsj.com
Below are some exerpts from the article.
SEC's 'Cyberforce' Scours Net
To Combat Investment Scams
Part of the article gives some background on John Reed Stark and then describes what he does.
Rather than a single Internet-focused department, Mr. Stark oversees a program that encompasses SEC attorneys, accountants and analysts from the SEC's regional offices around the country. It's Mr. Stark's mission to educate the entire SEC work force about how to track down and stop Internet scammers.
"In the early days, we tended to classify cases as to whether they were Internet-related or not," Mr. Stark says. "Now, I think the distinction is becoming blurred, because most investments touch on the Internet in some way. That's why our entire staff is being educated about the dynamics of the Internet."
As part of the educational process, Mr. Stark has spent the last year traveling to each of the SEC's 11 regional offices to run workshops on finding and prosecuting suspected cases of Internet fraud.
Mr. Stark and others at the SEC are convinced that they have the regulatory tools they need to make their mission effective. "At this point, we believe the legislation we have is sufficient, even though my sense is that we'll see an increasing number of Internet cases," says Joseph Cella, chief of the Office of Market Surveillance in the SEC's Division of Enforcement.
"Our users are becoming increasingly more reluctant to post," says Jill McKinney, one of the three people who operate Silicon Investor, a popular on-line small stock newsletter and discussion forum. "We are starting to get requests from people who want to post anonymously so as not to invite scrutiny."
"We're getting 75 to 100 e-mails a day -- 440 this past weekend alone," Mr. Stark says. Recently, the SEC for the first time took the direct route of posting trading suspension notices for two stocks -- Green Oasis Environmental and Genesis International Financial Services -- on bulletin boards run by America Online and Silicon Investor.
Mr. Stark's role as an adjunct professor of law at Georgetown University Law Center also has added to the Internet program's success. Over the summer, he taught a course on securities law and the Internet -- a class he has been asked to teach again this year. As classwork, students found and tracked suspected cases of fraud, providing valuable information for the SEC. "Although I can't talk about specifics, I can say that I learned quite a lot from the class," Mr. Stark says.
"I get postings from both sides." he says, "those that say 'You just saved me millions of dollars and you're the greatest agency on the face of the earth,' and others that say 'I'll meet you anytime, anywhere Mr. Stark, you just lost me my life savings.'
"We don't have a big press office and most of what we do is confidential, but we're bringing cases and we're doing our jobs. My aim is to demonstrate that we are not wandering aimlessly -- we know what we're doing."
Charles |
