Californian faces 100 years in jail and £10m fine for false press release
Emulex not happy
A 23-year-old California man faces 100 years in jail and a $10 million fine for trying to defraud investors in Emulex.
Mark Jakob was yesterday indicted by a Federal grand jury on 11 counts of securities and wire fraud, AP reported. The indictment charges him with making more than $241,000 from the scam - where an apparently bad gamble on the stock market left him facing losses of $97,000 on 24 August unless Emulex's share price fell.
The charges relate to accusations that Jakob issued a false press release on August 25 claiming Emulex's president was about to resign and the company was under investigation. It caused the share price to plunge by 62 per cent in one day, wiping $2.5 billion off the value of the Californian-based outfit.
The "statement" went out via Los Angeles-based service Internet Wire - where Jakob used to work, and was picked up by news services such as Bloomberg and CBSMarketwatch.
Jakob managed to recover his losses, but the FBI were hot on the case and traced the email account used to send the phoney release to a computer at El Camino College in Torrance, California - where Jakob was once a student. He was arrested on 31 August.
If found guilty it could land him in the slammer for 100 years paying off cumulative fines totalling $9.5 million. ®