A new twist on the wire….
There have been a number of high profile cases where press release wire services have been used by third parties to distribute false information which has materially affected a company’s stock price.
Now a new case has emerged and this time there’s a twist.
In the previous cases the releases, which were sent across Internet Wire, were hoaxes designed to engineer stock price fluctuations. However this time, the company in question, eConnect, allegedly sent out false press releases themselves!
According to PR Week, eConnect’s CEO, Thomas Hughes, was indicted last month for attempting to increase eConnect’s stock price by issuing false releases.
David Armon, president of the Americas for PR Newswire, who Hughes used for distribution, is quoted as commenting: “Just as we sent out releases for Enron, WorldCom, and Tyco, this one went out because our job is to verify the company issuing the release is really the company issuing it. We are just a distributor.”
I think that’s a fair comment, but if it’s true it’s another blot on the corporate landscape.
Murphy's Law 