Internet share 'scam' probed

By SIMON FLUENDY FOR MAILONLINE
Updated:

 

Stock Exchange officials are investigating what is believed to be Britain's first Internet share scam.

They are checking messages that appeared on the Net's Motley Fool site advising investors to buy shares in Car Group.

Motley Fool is an Internet investment club aimed particularly at newcomers. Managing director David Berger says it has more than 50,000 members.

But anyone can post messages on its bulletin board.

The messages claimed that Car Group was about to be taken over but, just weeks after the first message in September, the company went into receivership.

At least one Motley Fool user claims to have been duped into buying the penny shares and losing his money.

Motley Fool's rules forbid misleading messages. The organisation admits that it has been unable to trace the true identity of the author of the rogue messages.

Tim Anderson, partner at City law firm Reynolds Porter Chamberlain, reported the case to the Stock Exchange after seeing the messages.

He says Motley Fool could face prosecution under the Financial Services Act if it was thought that the Website had recklessly published a false or misleading statement.

Graham Quick, of rival bulletin board Website Hemmington Scott, says he deletes dubious messages.

He adds: 'I e-mail the person responsible and ask them to prove what they say.'

Lawrence Greenberg, lawyer for Motley Fool's US parent company, says: 'A warning was posted very quickly after the first message. I think that is important, but clearly there are going to be further discussions.'

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