IP: SEC finds new way to spend tax dollars: Creating fake companies

[David Farber <dave () farber net>]

> Date: Fri, 1 Feb 2002 02:14:05 -0800 (PST)
> From: Declan McCullagh <declan () well com>
> Subject: FC: SEC finds new way to spend tax dollars: Creating fake companies
>
>
>
> ---------- Forwarded message ----------
> Date: Thu, 31 Jan 2002 05:44:57 -0800
> From: Jack Dean <JackDean () webcommanders com>
> To: Declan McCullagh <declan () well com>
> Subject: Fake sites aim to teach investors a lesson
>
> Our tax dollars at work . . .
>
>
> http://www.cnn.com/2002/TECH/internet/01/30/investing.hoax.ap/index.html
>
> Fake sites aim to teach investors a lesson
>
> January 30, 2002
>
> WASHINGTON (AP) -- McWhortle Enterprises Inc. seems like the perfect
> investment for the post-September 11 world: a solid company, praised by
> analysts and customers, selling a handheld biohazard detector guaranteed to
> beep and flash in the presence of anthrax or other deadly germs.
>
> Only one problem: The company doesn't exist.
>
> McWhortle Enterprises is a government hoax cloaked in respectability and
> planted on the Internet, waiting to deliver a lesson about the risks of
> online investing to unsuspecting consumers.
>
> The Securities and Exchange Commission, the principal agency behind the
> fictitious company, was announcing Wednesday that it has seeded the Internet
> with a series of such Web sites laying in wait to say "gotcha" to naive
> investors, according to a source familiar with the project.
>
> The SEC would only say that it was holding a news conference to discuss
> "investor education initiatives."
>
> Barbara Roper, the Consumer Federation of America's director of investor
> protection, said she has no problem with the SEC's unorthodox methods.
>
> "There's clearly no intent here to do anything but educate the public in a
> way that might actually catch people's attention and make them realize they
> were that close to being scammed," she said. "You need to make the risk real
> to people."
>
> On Friday, the SEC issued a fake news release on behalf of McWhortle, saying
> the company would go public Wednesday, with company President Thomas
> McWhortle III holding a news conference at SEC headquarters. The release was
> distributed mainly to Web sites by a service for financial news. Financial
> news agencies that received the fake release were warned.
>
> [...]
>
> After the release was sent, the McWhortle Web site received more than
> 120,000 visits, the source said.
>
> [...]
>
>
>
>
> ____________________________________________________________
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