Twitter Stock Jumps Nearly 8 Percent After Fake Report

vivaoporto writes: As noted by Re/code and many other outlets, Twitter stock jumped nearly 8 percent after a bogus report, attributed to Bloomberg News, said Twitter had received a $31 billion buyout offer. The fake story, which cited "people with knowledge of the situation," appeared on a website (Google Cache version) made to look like Bloomberg's business news page and claimed the company had received a takeover offer worth $31 billion.

The website domain, bloomberg.market (now suspended), was registered Friday, according to a search of ICANN's records. The identity of the person or company who registered it is not publicly available. Close scrutiny flagged a number of questionable elements in the report, like the name of Twitter's former chief executive, Richard Costolo, being misspelled. By late afternoon, the web page for bloomberg.market was no longer operable. A message posted on the page said, "account suspended." A spokesman for Bloomberg confirmed the takeover article was fake.

In May, a fake bid for another company, Avon Products, sent its shares as much as 20 percent higher. That offer involved a document filed with the Securities and Exchange Commission. Last month the SEC sued a Bulgarian man, Nedko Nedev, and said he and five others worked together to violate securities laws by creating fake takeover offers. Robert Heim, a former lawyer at the SEC, said these kinds of schemes will probably persist because news spreads so fast over social media and traders have to react so quickly.

Comments

good!

[djradon]

hopefully this will encourage misinformation awareness or foster some web-of-trust technology.

Re:good!

[gl4ss]

this will only encourage similar crap.

someone made a tidy profit on it.

Re:can you imagine what would happen

[alvinrod]

Actually, several years ago there was some article posted to a part of CNN that allowed for user submitted content that claimed a person had seen Jobs being taken to a hospital after having a heart attack. Other sites started to run wild with the rumor and it caused Apple's stock to take a rather large plunge. Here's an article covering it that turned up after a quick Google search.

Re:can you imagine what would happen

[viperidaenz]

That gives me an idea

If anyone sees an article about Steve Jobs coming back from the dead to lead Apple again, it's totally legit.

"and traders have to react quickly"

[blind biker]

Spotted the problem right there. The stock market is not a tool for investment anymore: it's a gambling house and a system to extract wealth from long-term investors. Make it compulsory to hold one's shares for at least 6 months after purchase, and the problem solves itself. Of course, the fat cats don't want this, and they are the ones who have the actual power, so nothing will change.

What to take away from this...

[corychristison]

1. Buy stock in $LARGE_CORP, sit on it a while
2. Register bloomberg domain under generic, believable gTLD.
3. Create fake report about $LARGE_CORP being bought out at high valuation.
4. Spread fake article around social media.
5. Profit!

I think we finally found out what the value of ??? is.

Re:Sued perps of Fake Avon Takeover??

[penguinoid]

Just wondering, is that a limitation on free speech in general, or does it only apply to people who tried to profit off it?

They don't HAVE to react that quick

[houghi]

They WANT to react that quick. If you are working in milliseconds, this is what will happen and it encourages it.

Obviously the stockmarket will defend its own interest and that is the trading of the stock. As long as that is happening; why would they change it?

The stock market is just that: a market where they rent out space so you can sell your goods. They are not intrested if it is crap you are selling or great products. It is about volume.