SEC Says Hijacked Computers Aided Stock Scam
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Tuesday, July 10, 2007; Page D02
The Securities and Exchange Commission and Texas Attorney General Greg Abbott yesterday accused two Texas men of hijacking personal computers across the country to send mass e-mails and inflate prices on at least 13 stocks.
Darrel Uselton, 40, of Katy, and his uncle, Jack Uselton, 69, of Houston, cheated investors out of about $4.6 million by infecting computers with bot viruses that forward spam e-mails to tout shares, the SEC said in a statement. Recipients who fell for the enticements drove up share prices while the men allegedly sold their holdings.
The SEC has frozen dozens of stocks this year as it seeks to rein in the use of spam e-mails that attempt to inflate stock prices. The current investigation began after an SEC lawyer received one of the Useltons' e-mails at work.
"The use of bots to spread investment spam at exponentially higher rates is making this type of fraud an even more virulent threat to ordinary investors," SEC Chairman Christopher Cox said in the statement.
The suit, announced today, "is intended to protect investors from fraud artists who would treat the investing public as their personal ATM," Cox said.
