I could not believe what I found. Wait. That’s not entirely true. I certainly did believe it and wasn’t at all surprised.
George was behind bars.
It seems the former IRS agent was busted by current IRS agents. SEC investigators, too.
According to prosecutors, George did not disclose to investors that half their money was going to telemarketers as commission. Another portion was, apparently, going directly to George; nearly $3 million of it. That money was not reported as income.
George pleaded guilty to charges of conspiracy and filing a false tax return. He was sentenced to almost three years in federal prison and ordered to pay back $8.8 million to 216 investors.
As for the Corvette George gave me – ironically, I ended up selling it on eBay, of all places. I used the money for a down payment on a new house.
I still have that stock certificate.
CHAPTER 5
MY FIRST MEDIA FRENZY
While working with George, I developed a good relationship with the third party software developer that created the auction engine for BidBay. After George and I split and prior to the settlement, I decided to use the same technology and take a shot at starting my own auction site. I created the design and called it “DutchBid”.
I didn’t have any money to promote the new site, so I had to think outside the box. The timing was actually perfect. While vegging out on the couch, I came across a very interesting news story about Kevin Mitnick, the man known as the first hacker to be jailed for his hacking crimes in the United States.
Here’s what Wikipedia has to say about him:
In 1979, he broke into his first computer. He was sentenced to 12 months in prison followed by three years of supervised release. Near the end of his supervised release, Mitnick hacked into Pacific Bell voice mail computers. After a warrant was issued for his arrest, Mitnick fled, becoming a fugitive for two and a half years.
According to the U.S. Department of Justice, Mitnick gained unauthorized access to dozens of computer networks while he was a fugitive. He used cloned cellular phones to hide his location and, among other things, copied valuable proprietary software from some of the country’s largest cellular telephone and computer companies. Mitnick also intercepted and stole computer passwords, altered computer networks, and broke into and read private e-mail. Mitnick was apprehended on February 15, 1995 in Raleigh, North Carolina. He was found with cloned cellular phones, more than 100 clone cellular phone codes, and multiple pieces of false identification.
Mitnick served five years in prison — four and a half years pre-trial and eight months in solitary confinement — because, according to Mitnick, law enforcement officials convinced a judge that he had the ability to “start a nuclear war by whistling into a pay phone”, meaning that law enforcement told the judge that he could somehow dial into the NORAD modem via a payphone from prison and communicate with the modem by whistling to launch nuclear missiles.
He was released on January 21, 2000. In December of that year, Mitnick tried to raise some funds by selling a variety of items on eBay. He listed one of his cell phones, a small computer, and two of his prison identification cards. eBay decided they did not want the business of a hacker and closed the auctions. He then went to Amazon and Yahoo. Both had auction sites at the time and both gave Mitnick the same treatment. Mitnick was somewhat of a celebrity in geek world, so it was no surprise the media grabbed a hold of this story.
This was my opportunity!
It didn’t take much searching to find a telephone number for Mitnick. I called him and offered DutchBid as a venue to run his auctions. His first concern was there was relatively no traffic at the site and barely fifty auction listings. I assured him that would not be the case, once he listed his items. In reality, I had no idea if the press would still be interested, but I painted a picture of the media swarming to cover the auctions. It worked.
As a part of his release, the judge ordered that Mitnick could not touch a computer for five years, so all my future email communications were between Mitnick’s father and me (ya right). His “father” set up an account on DutchBid and listed the items. In addition to the items previously taken down by eBay, Mitnick listed several autographed bumper stickers with the slogan “Free Kevin”, which was the battle cry of fellow hackers during Mitnick’s incarceration.
Immediately after the auctions were listed, I wrote a short press release that read:
After being shut down by eBay, Yahoo and Amazon auctions, Kevin Mitnick’s genuine prison ID cards and other personal items are back on the auction block.
This time at DutchBid.com.
On Monday, eBay had pulled the auction of Kevin Mitnick’s Federal Bureau of Prisons inmate ID card, ending a flow of authentic Mitnick merchandise that was placed up for auction by Mitnick’s father. Kevin Mitnick is barred from using computers and accessing the web under the terms of his supervised prison release.
Kevin Mitnick, who has been called a “computer terrorist” by the Department of Justice, is perhaps the most high-profile computer criminal to date.
The official Kevin Mitnick web site claims that, “Kevin pursued his hacking as a means of satisfying his intellectual curiosity and applying Yankee ingenuity. These attributes are more frequently promoted rather than punished by society.”
DutchBid founder and president Eric B. Rosenberg feels that that Mitnick memorabilia should be available to the public. He stated, “Whether you believe that Kevin is a criminal or a hero is irrelevant. The fact that the ‘big three’ auction sites would remove Mitnick memorabilia, but allow the auctioning of Nazi material is absurd. Kevin Mitnick’s personal items are certainly welcome at DutchBid.com.”
I submitted that press release to PRweb.com and paid the small fee. Then, I did a search for all the news outlets, blogs, and opinionates that wrote about the Mitnick/eBay story online. I emailed a copy of the press release to each of the writers. After 24 hours, I was disappointed to only receive a call from one of them. It was a small online news site that I can’t even remember the name of. The reporter wanted an interview with Mitnick and me. Later that day, we had a three way call. I was asked three questions and the rest of the thirty minute call was spent questioning Mitnick. A few hours later, the interview was posted online. It was no swarm, but I was happy to have just one article written about my new site.
That night, just as I was about to head off to bed, the phone rang. I thought, “Who could be calling me at two in the morning?” I almost didn’t answer. “Is this DutchBid.com,” said the female voice on the other line. I said yes. It was Kelly Yamanouchi, a reporter for the Associated Press, which was the biggest wire service at the time. She said she had a tight deadline, so she rushed through a few questions and quickly hung up. I went to bed.
I woke up around 9am and turned my computer on. I had over 4,000 emails! Most of them were notifications of new registrations at DutchBid, but a lot of them were from reporters wanting an interview. I opened my browser to find out where the traffic was coming from. It was from all over the world! There were news articles being published about DutchBid in every language imaginable, although most of the traffic was coming from articles published in the United States.
CNet.com wrote about my site. USA Today,
