By Jon Bernstein, 1 September 2000 08:31
NEWS A 23-year old man has been arrested in connection with a hoax that saw high-speed networking firm Emulex lose over half its value as investors reacted to phoney statements about the company's performance. Mark Jakob was picked up at his California home on Thursday morning by FBI agents and charged with securities and wire fraud. The arrest follows the publication of a press release, supposedly from Emulex, which outlined a series of damaging announcements. According to the release, the technology company had been forced to issue a profit warning and was being investigated by securities regulators. As a result, the release continued, the company's CEO, Paul Folino, had stepped down. All proved false but not before the news had been picked up by a number of wire services and websites. Investors reacted by selling shares knocking $2bn off the company's value. Jakob is due to appear in court today at 3pm California time (10pm BST) and if found guilty faces up to 15 years in prison.
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