Cyber Cops Enforce Law and Order on the Internet
Researching a stock or
mutual fund? The Web
can be a handy place to
find official. documents such as
prospectuses and semiannual re-
ports.
A lot of investors also love to troll
for information elsewhere online.
They visit chat rooms and discussion
groups, hoping to team something
that will help them make a buy or
sell decision.
When they go to such Web sites,
most shareholders know it's like step-
ping into a boxing ring. They're sup-
posed to keep their guard up at all
times. The true surprise is that online
investment forums aren't as lawless
as most people think.
Cyber cops patrol some sites.
People trying to hype or front-run
stocks often get pinched by these law
officers. That helps save discussion
sites from being taken 'Over by Wall
Street's version of pickpockets and
muggers. It encourages honest inves-
tors to keep using the sites to swap
ideas and fish for leads.
The cops' job is generally to keep
the peace. But they actually aren't
there in the role of police. Their job
is closer to high school hall monitor .
Their main duty is to enforce the
site's own rules for use by members.
That often means fostering civil be-
havior and putting a stop to escalat-
ing arguments among members.
When they nab someone hyping or
front-running a stock, it's typically
only because the perpetrator has vio..
lated the site's code of conduct ,--Its
"netiquette."
" And we reserve the right to take a
message down if it is a violation of
our terms of service."
The site's parent portal, Yahoo,
says it has the busiest message
boards on the Web, citing data from
Media Metrix.
Other sites make no bones about
having a cop on the e-beat. The Mot-
ley Fool, for example, says it has 2
million visitors ("fools" as the site
calls its followers) a month to its
4,000 active topic boards. With a
click of the mouse, anyone cart re-
port a problem post. Reports are in-
vestigated by the site's 15 to 20 moni-
tors, whom the site calls strollers.
"Strollers look for things we don't
allow," said Jamie Patten, a spoke-
woman for TMF. "We don't allow
hyping of stocks, especially penny
stocks. And we don't allow othervio-
lations of our terms of use."
If a stroller decides that a posting
is a violation, he removes it from the
message board. He also sends an ex-
planation to the person who posted
it. Hyping in particular is barred to
protect TMF's fools.
"We are an educational forum for
investors, not stock pickers and not
stock hypers," Patten said.
She added: "Hyping a stock is usu-
ally a sign that you want people to
buy a stock. But it's usually a stock
someone wants to sell. They want to
unload it. It's usually a scam."
Silicon Investor is another site with
a full-time cyber cop, Bob Zumbrun-
nen. Like other investment sites, SI
does not want to scare off partici-
pants by suggesting that Big Brother
is watching.
Rather than refer to Zumbrunnen
as a cop, SI calls him its community
administrator.
Like monitors for other sites, Zum-
brunnen's role is to enforce his site's
terms of use. Generally, he works in
response to complaints.
At the topic
forum that is the
scene of the al-
leged violation,
he reads posts
about which
members are com-
plaining. Since
messages are
often replies to
one another, he
reviews all of the
posts involved.
"Each. ..can
be traced backward like a thread,"
Zumbrunnen said in an e-mailed re-
sponse to questions from IBD.
Zumbrunnen is assisted by one full-
time deputy. They're backed by five
to 10 customer support representa-
tives.
They normally help members with
routine matters such as replacing lost
passwords. What Zumbrunnen does
not do is peer over members' shoul-
ders, reading everything posted.
" A common misconception," he
wrote, "is that we read over posts.
...We are unaware of the contents
of any particular post unless someone
complains about it."
Zumbrunnen checks out 10 to 20
complaints a day. Years ago, the
daily volume went as high as l00.
The worst violations involve spam-
ming -- sending electronic junk mail
to lots of people, After all, no one
likes junk mail. And using the tech-
nique to boost a stock poses a finan-
cial threat to members.
It's one of several offenses that
breach the site's terms of use.
Others include vulgarity and copy-
right violation.
Personal attacks are also a viola-
tion. That means Zumbrunnen some-
times must step in when online de-
bates escalate into shouting matches.
Combatants periodically threaten
each other.
"I've never been threatened with vi-
olence," wrote Zumbrunnen. "But I've
often had people say they would. .
file suit against me. None have ever
materialized. "
Penalties for violating SI's terms of
use range, from a warning to loss of
membership.
Zumbrunnen started patrolling in
1997. He went full-time in June 1998,
While SI is based in Seattle, he works
from outside Kansas City, Mo. He
says his job has actually gotten easier
over the years.
"The average level of market
savvy," he wrote, "has gone way up.
...The average member, ..now is
far better equipped to refute lies on
their own and is more inclined to at
least listen to a critic before deciding
whether to heed or dismiss them."
Raging Bull, another popular invest-
ment site, has half a dozen monitors,
whom it calls community advocates.
The site has 725,000 members, says
Tara Burgess, Raging Bull's manager
of community development. It gets
60,000 messages on an average mar-
ket day.
"We are not in the business of mon-
itoring chat boards," said Burgess.
"We create an open forum and let the
community drive it and police it."
Advocates do not search for viola-
tions on their own, Burgess says.
They merely respond to complaints by
members.
The complaInts RagIng Bull IS most
likely to react to are those involving a
violation of the site's terms of use.
Here too spamming is a violation.
"Sometimes members get upset be-
cause someone is bad-mouthing a
stock," said Burgess. "We won't delete
a member's post for that. But if the
person is abusive or posting false in-
formation, we might remove that. If a
member engages in consistently bad
behavior, they could be suspended or
deleted from service."
A company that's the target of an
online message must prove that a
posting is false before Raging Bull
will delete a posted message.
"If someone can't come up with
concrete information to show that, we
don't remove the post," Burgess said.
Raging Bull offers members another
way to deal with offensive partici-
pants whose behavior falls short of vi-
olating terms of use.
"Members can click .on their 'ig-
nore' feature," Burgess said. "Then
they don't have to read someone's
post. That sends a strong message,
which has changed some people's be-
havior." |
