Description: Article in SACC / San Fransico magazine

Two months ago, an unknown individual drove up the stock prices of Neurosearch, the Danish pharmaceutical company. A press release — with the letterhead of the SE Bank — announced that another Danish company had made an advantageous takeover bid. The stock immediately rose by just over twelve percent. There was the fact that the press release had been sent from a 7 Eleven store — it was even listed as the sender — and everybody knows, if you stop to think about it, both that scanning the bank’s stationery is a cinch and that it has its own fax. But who has time to think when you are in a hurry to make a killing?

A few years ago, a much cleverer attempt was made to push prices of Ericsson stock higher. Someone sent a fax containing a press release that announced that Motorola had made a takeover bid. Here, too, the stationery was the right one but it also contained the right telephone number to the sender and the right individuals with the right extensions to answer any questions (although the sender must have known that the individuals in question were airborne at the moment). It was not hard, every teenager knows how to program the number of the sender into a fax machine. The whole affair would probably have hit the press, had not Ericsson happened to have what was arguably the best information officer in Sweden, a man whom it seemed natural for the journalists to call and wake up with their questions. Nils Ingvar Lundin was available, as always, and his credibility with the journalists was such that they believed his denials.

Three years ago, a bizarre episode in the history of international news services took place. The venerable news agency, Reuters, issued a statement that Pol Pot, the leader of the Khmer Rouge, had arrived at Arlanda Airport, seeking asylum. Those who checked the web page of the source,, were treated to a jerky film showing a short man leaving an SAS airplane. Everything was a fake, a public relations gimmick by a Swedish web design bureau, which wanted to show effectively how easy it is to be taken in by the Internet. No damage was done, except for the Foreign Ministry officials who spent days denying that Sweden was prepared to receive the mass murderer.

The dirtiest part of the recent American election campaign was the South Carolina primary in which George W Bush defeated the Republican challenger John McCain. On the surface, it was a hard-fought campaign with a fair amount of negative advertising. But below the surface, McCain was subjected to a nasty campaign of mudslinging. His media adviser, Mike Murphy, was himself known as a tough guy when it came to propaganda warfare. (His license plate was GONEG: Go Negative). But not even he had been able to foresee the rumors that were spread, primarily on the Internet.
The fact that John McCain and his wife had adopted a child from Mother Teresa’s orphanage was turned into a rumor that McCain, who had been a prisoner-of-war in Vietnam, had a child with a Vietnamese prostitute — to take just one of the more benevolent attacks. Most were probably not believed, but the flood of anonymous telephone calls, e-mails, etc. rattled and damaged McCain’s campaign.

Both parties were lavish with rumors. They were usually difficult to trace. The source was, in each case, at a safe distance from both candidates and the campaign headquarters.

Today every conceivable statement about a company or a person is circulating out there. They are not noticed, and nobody cares. But in a crisis situation, they suddenly appear out of cyberspace. By then, management is too busy to have time for a denial.

A first piece of advice is to get a newly published brochure from the Psychological Defense Board: ”Source Critique for the Internet”. It may, at best, prevent you from being taken in by deliberately planted rumors. Another is to have someone periodically monitor different chat sites and keep track of the rumors circulating in cyberspace. It may prove to be a better investment that buying stock in Neurosearch.

Olle Wästberg