From: Adam Rifkin (Adam@KnowNow.Com)
Date: Thu Aug 31 2000 - 15:59:36 PDT
[How could he think he wasn't going to get caught? Also, you gotta feel bad
for the small investors who panic-sold during the hour before the stock
halted. They aren't getting their shares back...]
Emulex case cracked with Web savvy, legwork
By Dan Whitcomb
LOS ANGELES, Aug 31 (Reuters) - It was the sort of case that Sherlock
Holmes could have cracked, if he knew a thing or two about the Internet.
For all of the boasting by authorities about the clever Web sleuthing they
employ to catch crooks in the Age of Cyberspace,
the arrest of a 23-year-old college student in the Emulex Corp.
(NasdaqNM:EMLX - news) stock hoax can be credited equally to old-fashioned
deductive work.
Mark Jakob, a student at El Camino Community College in Redondo Beach,
Calif., was captured on Thursday and charged with staging one of the
biggest financial hoaxes yet on the Internet, which allegedly netted him
almost $250,000.
Jakob allegedly did so by posting a fake press release about Emulex on
Internet Wire Inc., a news dissemination service where he had worked until
a week earlier.
Authorities said Jakob -- who had played the market in Emulex and stood to
lose almost $100,000 if the stock didn't tank soon -- claimed in the
release that the data networking equipment company was in dire financial
straits and under investigation by the Securities and Exchange Commission.
That ``news'' sent the market price plummeting and helped Jakob make back
his money, which he then parlayed by investing in even more Emulex stock.
Alejandro Mayorkas, U.S. Attorney for the Central District of California,
crowed at a press conference that federal agents needed Internet savvy to
track Jakob across the information superhighway and into his electronic lair.
``Do not count on the anonymity of the Internet to serve as a shield for
your illegal conduct,'' Mayorkas warned would-be Web-crooks. ``We in law
enforcement can navigate the information superhighway just as we can beat
the pavement. As technology advances, so do our investigative techniques,''
he said.
``We in law enforcement know how to use the Internet too,'' Mayorkas added.
And FBI spokesman James DeSarno said that the arrest of Jakob one week
after he allegedly posted a bogus press release that sent Emulex stock
plummeting ``is an example of our ability to use technology to meet the new
crimes of the 21st Century.''
But the capture of Jakob -- who apparently made no effort to flee after the
hoax was exposed and reported extensively in the press -- seemed to require
as much traditional detective work than Internet know-how.
The Internet sleuthing comes in because immediately after the fraudulent
press release was found, agents were able to quickly track its origins --
by means of an Internet Protocol address -- to a computer at El Camino
Community College.
After interviewing officials at Internet Wire, the agents learned that
Jakob -- whose job it had been to process press releases -- had quit the
week before, was a student at the college and was known around the office
for often talking about the stock market.
After college officials and a library employee confirmed that Jakob was a
student there and had been seen using its computers, SEC officials checked
market records and saw that he was heavily invested in Emulex.
Authorities then checked the college computers and found evidence of the
bogus press release before obtaining a search warrant for his home and home
computer. Authorities apprehended Jakob at home.
---- Adam@KnowNow.Com``We're taking another important step in advancing our AOL Anywhere strategy. Our AOL members want access to applications like news, stock quotes, and e-mail over a wide range of devices, no matter where they are,'' said Ted Leonsis, president of America Online's Interactive Properties Group. ``Quack.com's technology will help extend the AOL experience beyond the PC.'' -- http://dailynews.yahoo.com/h/ap/20000831/tc/aol_quack_1.html
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