SEC officials declined to comment on the specific Emulex incident. Although releases of bogus news and information are rare, regulators and law enforcement agents have reason to be concerned about their apparent increase and the Internet's role in the crimes. SEC spokesman Chris Ullman said the commission has seen about 130 incidents of Internet fraud during the past five years, most of which occurred in the past two years. The agency has several hundred attorneys periodically trolling the Net for evidence of fraudulent or manipulative behavior, he added. Penalties for using the Net to manipulate stock prices aren't intrinsically any more severe than for similarly illegal offline behavior.
Jail time is also an option.
They may try to hide behind false identities, but we have subpoena power and can root them out. In the PairGain case, Gary Hoke was arrested after authorities scoured the network logs of several companies. Other stock manipulation cases include Aastrom Biosciences, which saw its stock spike after an apparent hacker allegedly posted a fake announcement on the company's Web site. But stock manipulation efforts need not be so elaborate. Internet stock chat rooms and message boards make it easy for manipulators to anonymously post fake announcements and news articles.