janice and crew get the hook!!!!!
Vigilante Joke Is Serious Business
By Susan Antilla
Westport, Connecticut, May 4 (Bloomberg) -- It could easily pass for the workspace of a slightly messy college student. There are the bookshelves stocked with computer and Internet titles, the Star Wars videos, the Billboard Top Rock'n Roll Hits CD set, and the Mickey Mouse clock hanging just beside the Gateway 2000 computer.
The misconception is corrected when Jeffrey Mitchell activates his computer screen and reveals his ''Moonshot'' index, a roster of motley small company stocks that could best be described as shaky.
''It's a portfolio I created,'' he says, ticking off the most noteworthy from among a list of 25 that includes an Internet company run by a disgraced former broker, a mining company once suspended by the Securities and Exchange Commission and a maker of gun locks once probed by the SEC. ''These are all horrible companies.''
Mitchell should know. Not only has he examined the sometimes dicey dossiers of a number of the Moonshot 25, but he's warned investors away from many of them, posting 7,182 messages on the Silicon Investor message boards since November of 1996. While not all his messages warn of scams -- sometimes he actually promotes a stock -- most of those over the past year have involved warnings of some sort.
''It's a neighborhood watch kind of thing,'' says Mitchell, 38.
Mitchell and two buddies he refers to as ''cyberfriends'' (they've never met) are self-styled Internet vigilantes who have developed nearly full-time hobbies of exposing shams on the World Wide Web. Janice Shell, an art historian in Milan, and William Ulrich, a Web page designer in San Francisco, along with Mitchell do what's considered God's work in some quarters.
The devil's work in others.
April Fool
Today, it's Mitchell and two of his Internet cohorts who are under fire, for -- of all things -- perpetrating an ''investment scheme'' against the public.
On April 26, the San Francisco-based Business Wire, a press release service, sued Mitchell, Shell and Ulrich for trademark infringement, breach of contract, fraud, defamation and conspiracy. At the heart of the suit: a phony press release put out over the Business Wire by Mitchell, Shell and Ulrich as an April Fool's Day prank. The fake story announced the sale of 40 million ''nodes'' (as opposed to shares), at $100 a node, of a fictitious Internet venture. (A node, according to an Internet dictionary that is written in a dialect I don't understand, is ''an addressable device attached to a computer network.'')
The press release referred investors to their webnode.com web page, which explained everything from how to buy nodes (though in fact there was no way to send in money) to how the nodes would trade.
''A 'Node Trading Fee' will exist, much like the commission one pays to buy or sell stocks,'' the webnode.com page instructed on a page of ''Frequently Asked Questions.''
A Second Hoax?
The antics of the three are so well known that one person who visits Silicon Investor thought the very mention of the lawsuit by the vigilantes might be a prank. ''I was totally confused,'' wrote ''Shaun'' on April 29. ''I thought you had made up not only the press release but also the fact that you were getting sued.''
Mitchell, Shell and Ulrich are ''executives'' at FBN Associates, FBN being an acronym for ''Fly By Night.'' FBN says its earlier April Fool's efforts include 'the April 1, 1997, hoax for 'Techni-Clone,'' a company whose ''neural network chip'' could be replicated using ''embryonic cloning.'' Shell has posted more than 20,000 messages on Silicon Investor and was dubbed ''unofficial queen of the cybervigilantes'' last October by Fortune magazine. Asked how many hours a day he spends researching and exposing scams on the Internet, Ulrich said ''Gosh, I'm embarrassed to say. It's probably on the order of six hours a day.''
Diversionary Tactic
This year, to help pull off their ''webnode'' prank, they set up a diversionary April Fool's joke on a page called ''funphone.com.'' Suckers find themselves hollering at their computer screens, when instructed to ''speak louder'' into the nonexistent FunPhone in their computer. A FunPhone Online Store carried accessory products including a Stolen Organ Recovery Service (implant a transmitter in your kidney in case a thief should run off with it).
FBN's latest joke has been lost on executives at Business Wire, who contacted the Securities and Exchange Commission and the Federal Bureau of Investigation about the webnode prank. The SEC would not comment. Dave Dillon, the Bridgeport, Connecticut, FBI agent who contacted Mitchell on April 22, said he would not comment. ''If there is any merit to it, the FBI would follow through,'' he said.
At Business Wire, spokeswoman Cathy Baron Tamraz said, ''We are nota sue-happy company.'' The webnode.com prank, though, ''went beyond the boundaries of an April Fool's joke'' and was particularly troubling on the heels of the April 7 hoax on the Internet that boosted shares of PairGain Technologies Inc., Tamraz said. In that hoax, a PairGain employee put up a phony Web page to look like the one run by Bloomberg LP, owner of Bloomberg News. Bloomberg and the SEC have sued the employee, and a Los Angeles federal grand jury has indicted him on five counts of securities fraud.
Real Stocks
Mitchell says no one invested or lost money as a result of the FBN hoax, but the lawsuit suggests that the hoax may have moved stocks of companies FBN referred to as ''early adoptees'' of the technology it claimed was being sold. Frank Walter, a spokesman for MCI/WorldCom Inc., said he would not comment specifically on the hoax, but that ''we're always concerned when our name may be used inappropriately.'' But Mark Siegel, a spokesmen at AT&T Corp., said, ''I don't think this is anything we're going to lose any sleep over.'' Added Andy Mantler, a lawyer for ITC-DeltaCom Inc., another company mentioned in the bogus press release, ''I don't think this had doodly to do with our stock.''
Business Wire is concerned over a ''surge'' in releases by a new type of customer that does not come from the ranks of the biggest companies, Tamraz says. People and companies announcing such things as opinions on stocks are making up an increasing amount of Business Wire's business, she says, putting more pressure on the company to be careful about what it publishes.
Tamraz says Business Wire has no regrets about pursuing what's turned out to be an unpopular lawsuit among some vocal visitors to Silicon Investor.
Who's Fault? At competitor PR Newswire, though, president Ian Capps has a different point of view about fighting back when a hoax is perpetrated. ''It would not be appropriate for us, if we accepted the news release in the first place, to sue the person who paid us to put out that news release,'' he says. ''It would be a shame on us to have let it through.''
So far, if the defendants are anxious about the suit, they aren't letting on; Ulrich says the suit is without merit, and the three have hired a San Francisco expert in trademark and Internet law to represent them.
Would they consider calling off next year's hoax? ''Of course not,'' says Shell, adding that it's too early to think about what scam they'll target. Wait until December 1999, she said, and then ''We have to see what's hot.'' |
