N.C. Suspect Charged In PairGain Internet Case
Thursday April 15 4:08 PM ET
RALEIGH, N.C. (Reuters) - A North Carolina man was arrested Thursday on charges stemming from a false Internet posting that sent the
stock of a California company, PairGain Technologies Inc into a wild swing, a federal official said.
The suspect, Gary Hoke, was arrested in Raleigh early Thursday on charges filed in California, Gloria Dupree, a spokeswoman for the U.S. Attorney in Raleigh, told Reuters.
The exact charges were not immediately available.
Dupree said Hoke appeared briefly before a federal magistrate in Raleigh and was released under $50,000 bond.
PairGain, a maker of high-speed access products used by phone companies, saw its stock soar by 31 percent and then fall back to earth on April 7 when the bogus story appeared.
A financial Web page sponsored by Internet portal, Yahoo Inc. (Nasdaq:YHOO - news), included a link to a posting that falsely said that PairGain was about to be acquired by an Israeli-owned
telecommunications firm.
The posting was formatted to look like a Bloomberg news story, but Bloomberg published its own story denying the bogus feature, and the Israeli company, ECI Telcom Ltd, said it was not in talks to buy
PairGain.
A spokeswoman at PairGain headquarters in Los Angeles said the company would have no comment on the arrest. Hoke was not immediately reachable.
It was not immediately clear what connection, if any, existed between Hoke and PairGain. |
