x Abu Dhabi, UAEMonday 22 January 2018

Twin deception

Greed, coupled with a strong dose of naivety, can often be a very bad thing indeed.

'Greed is good," Gordon Gekko famously said in the 1987 Hollywood hit Wall Street. Unfortunately, greed coupled with a dose of naivety can often be a very bad thing too.

It certainly was for those who invested in a stock venture dreamed up by the then 16-year-old twins Alexander John and Thomas Edward Hunter in 2007.

On Friday, the US Securities and Exchange Commission said it was charging the British brothers for defrauding thousands of investors in an online scam in which they claimed that a "stock-picking robot" could spot hot penny stocks for investors. In reality, they just picked the stocks they were already invested in.

The robot, called Marl, was supposedly engineered by a Goldman Sachs programmer for a computer-managed fund. And it seemed many people took the teenagers at their word. According to the SEC, the twins made $1.2 million (Dh4.4 million) from investors, and another $1.8 million (Dh6.6 million) from stock promoters.

In pulling off the "pump-and-dump" scheme, the Hunter twins made suckers out of thousands. It seems the adage about a fool and his money being soon parted is as true as it ever was.