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SI - Site Forums : The History of Silicon Investor -- Ignore unavailable to you. Want to Upgrade?

To: Josef Svejk who wrote (607)	2/19/1999 4:46:00 PM
From: Jeffrey S. Mitchell	Respond to of 1327

I think you got the accent wrong. The sentence should read: "Keister also says the site doesn't attract the usual array of con artists..." and not... "Keister also says the site doesn't attract the usual array of con artists..." - Jeff (FBN, not your usual company (g))

To: Josef Svejk who wrote (607)	2/22/1999 1:25:00 PM
From: Jeffrey S. Mitchell	Read Replies (1) \| Respond to of 1327

Stemming the Tide of Touts on Stock Message Boards By MICHELLE LEDER <snip> As stock message boards grow in popularity -- well over 30,000 messages are posted on the four largest boards on a typical day -- pressure is mounting on several fronts to rid the boards of people who use them to illegally tout stocks and spread false information. The Securities and Exchange Commission has defined such touting as lying about companies, lying about one's independence from a company or failing to adequately disclose the nature, source and amount of compensation one receives from a company. <snip> He is not alone in such concerns. To track down flagrant abusers of the message boards, the SEC is increasing the number of subpoenas it issues to board operators, allowing it to try to tie a posting to an e-mail address. Though the commission declined to say how many subpoenas it was issuing, board operators say that they have become much more frequent and that the SEC is requiring a quicker response. Companies fearing possible stock manipulation have raised their own complaints with securities regulators and board operators. But executives at the four largest boards -- Yahoo Finance, Silicon Investor, the Motley Fool and the Raging Bull -- worry that in the frenzy to eliminate abuse, legitimate investors will face restrictions on what they can say on the boards. "Anyone who looks at the boards knows that there's some manipulation involved," said Ethan Caldwell, the general counsel for Go2net Inc., the Seattle-based parent of Silicon Investor, whose boards average 15,000 postings a day. "It's a double-edged sword, because the boards are a unique medium where the average investor can find out information. The flip side is that the stocks are subject to manipulation." But distinguishing between manipulation and the innocuous musings of an enthusiastic investor can be difficult. Though rules vary from board to board, few messages are ever removed. In fact, of the four largest board providers, only the Motley Fool even monitors its boards, never mind screen them for accuracy, which all four regard as impossible. Instead, the board providers rely heavily on self-policing, with participants complaining to the board operator and the SEC when they think someone is trying to manipulate a stock. <snip> Much of the problem lies in the anonymity provided by the message boards. With little effort, people can create several identities on the boards and keep changing their names, often bouncing from board to board. If someone is suspected of manipulating a stock on a board, the SEC can issue subpoenas, but even if it can obtain a user's real e-mail address, investigators must still match the user's postings to sales activity. "Once they get a cheap stock, they have to manipulate it, and the best way to manipulate it is to quickly spread false information," said Richard H. Walker, director of enforcement at the commission, describing its Internet surveillance as "one of the highest priorities." During a single day in October, in its first sweep in this area, the commission filed 23 enforcement actions against 44 individuals accused of touting stocks. A spokesman for the SEC said the commission would also investigate message-board users who spread negative rumors. Enforcement actions can include formal charges, fines and bans on future trading. The SEC can sue in federal court or bring an administrative proceeding; in either case, the accused can mount a defense. After the October action, complaints to the SEC about message-board activity rose from about 120 a day to as many as 400, then receded to about 200 to 300. About 120 investigators actively surf the Internet, looking for abuse on the message boards, Walker said. The SEC and most companies tend to ignore so-called chat rooms -- which can also be filled with rumors -- because the real-time talk on such sites is quickly erased. "We consider the worst threat the posting on the bulletin boards, because it stays up there virtually forever," said Michael D. Allison, chief executive of International Business Research in Princeton, N.J., a corporate investigations firm. <snip> Some companies try to press their cases with the SEC John Stark, director of Internet enforcement for the commission, said the number of calls from corporate investor-relations officials about message boards has gone from several a month to several a day. Some companies appeal directly to the message boards, though they are rarely successful. "We get a ton of requests from corporate officers and even corporate counsel to remove messages," said Caldwell of Go2Net. "And we tell them in as nice a way as we can that we have no way of knowing if the information is true." <snip> Full link: search.nytimes.com - Jeff P.S. I left a bunch of stuff out for copyright reasons. It's well worth reading the actual article.