Indiana Law Journal Volume 75 | Issue 1 Article 18 Winter 2000 "Click Here to Buy the Next Microsoft": The eP nny Stock Rules, Online Microcap Fraud, and the Unwary Investor Kevin C. Bartels Indiana University School of Law Follow this and additional works at: http://www.repository.law.indiana.edu/ilj Part of the Internet Law Commons, and the Securities Law Commons Recommended Citation Bartels, Kevin C. (2000) ""Click Here to Buy the Next Microsoft": The eP nny Stock Rules, Online Microcap Fraud, and the Unwary Investor," Indiana Law Journal: Vol. 75: Iss. 1, Article 18. Available at: http://www.repository.law.indiana.edu/ilj/vol75/iss1/18 This Note is brought to you for free and open access by the Law School Journals at Digital Repository @ Maurer Law. It has been accepted for inclusion in Indiana Law Journal by an authorized administrator of Digital Repository @ Maurer Law. For more information, please contact
[email protected]. "Click Here to Buy the Next Microsoft": The Penny Stock Rules, Online Microcap Fraud, and the Unwary Investor KEVIN C. BARTELS" I. INTRODUCTION Investment fraud is a time-honored tradition. As far back as the 1700s, con artists on London's Exchange Alley were using a "pump and dump" scheme to defraud investors.' The "pump and dump" scheme used by con artists in eighteenth century London was simple but effective: the price of worthless shares of the "South Sea Bubble," a South American trading company, was inflated by false rumors of profitability spread about the company by owners of the shares, who then sold