Dot Com Startup Charged With Defrauding Investors

from the it-took-them-four-years-to-figure-this-out? dept

The SEC has charged a New York dot com startup for misleading investors to raise $2.3 million. Apparently, the dot com set up a boiler room type of operation, and would say just about anything to investors to get them to put in their money, such as saying that the company was about to go public. Apparently, they sold nearly 7 million unregistered shares this way to 350 investors in 1999 and 2000. While, these days, it's no surprise to find out that dot com startups during the bubble could find investors with too much money and no interest in doing even the slightest due diligence, you have to wonder why it took four or five years to catch this scam.

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