He found that by getting up at 5:30 in the morning and working hard, he could post two hundred messages in various places saying wonderful things about one of the companies he’d invested in and advising everyone to buy the stock for themselves. He says he didn’t tell any real lies about the stocks, but he certainly made predictions about future prices that weren’t based on good information and he certainly used extravagant language. For example, he said the stock of one company, Firetector, was “The most undervalued stock ever” and that, in the next week, it was going to “explode.”

When people saw these messages they bought the stock and that pushed the price up. Then Jonathan sold and made a lot of money. Once he made $74,000 in just one day. In six months, he made almost $800,000.

In the chat rooms, Jonathan ‘met’ a man called Ira Monas. Ira was connected with two companies Jonathan had invested in, Firamada, a temporary employment agency in Texas, and Havana Republic, a cigar distributor in Florida. He had been hired by both these companies to promote their stock. Jonathan repeated some of what Ira had said and even posted it on his own website. In the summer and autumn of 1999, however, it turned out that a lot of the things Ira had been saying about these companies were untrue. Both companies had actually been losing money.

When they learned that Ira had been lying about the companies, some of the investors complained to the SEC, an organization that supervises the stock markets in the United States. When the SEC investigated, they found out that Jonathan had been repeating Ira’s claims and they suspected that, like Ira, he was working for the companies. In the US, it is against the law to dishonestly promote the stock of a company you are working for. So Jonathan was charged with stock manipulation. When they questioned him however, the SEC realized that he was not working for the companies and that his only contact with Ira had been exchanging a few online messages. They continued to insist that Jonathan had been acting illegally, but they realized their case against him was weak. They couldn’t prove he knew Ira’s information was false when he repeated it. They made a deal with him: he had to pay a fine of $280,000, but he was allowed to keep the rest of the money he had made, around half a million dollars.

Even though he paid the fine, Jonathan refused to admit he had done anything wrong. A year later he was still online, enthusiastically promoting stocks. But by that time he had probably learned the simple rules for getting away with this sort of thing: don’t ever use your own name when you post; don’t promote the same stock for a long time; and stay away from suspicious people.