G4S hoax not the work of short sellers
13 November 2014 London
Image: Shutterstock
A fake press release and website that claimed G4S had miscalculated its accounts caused the security services company鈥檚 share price to drop, leading some to incorrectly suggest that short sellers were behind the plot.
The press release, purporting to be from the press office of G4S, was distributed to journalists via email on 12 November. Its contents were then picked up on Twitter, causing its share price on the FTSE 100 to drop, hours after the company issued a positive trading update.
G4S shares, which had risen during intra-day trading following the update, ended the trading session up 2.1 percent. Shortly after the press release was distributed, the stock fell marginally before recovering.
The drop caused some commentators to suggest that short sellers were behind the hoax, but data from SunGard鈥檚 Astec Analytics showed that short selling volumes have actually decreased around 10 percent from more than 35 million shares on 6 November to around 32 million on 13 November.
This was in line with an expectation of more positive trading news from G4S. David Lewis, senior vice president at SunGard鈥檚 Astec Analytics, said: "The data suggest that this is not a short selling plot, but simply mischievous behaviour from unknown quarters."
The fake press release claimed that accounting errors meant that G4S had recorded net losses for both 2013 and the first six months of 2014.
Journalists soon discovered that the press release was false, as it contained missing words and spelling mistakes, as well as the name of a press officer who no longer works at G4S.
The press release included a telephone number for an automated answering service, which ran a message informing callers that the press office鈥檚 lines were busy, and a link to a copycat G4S website that soon went offline after the forgery was unmasked.
In a statement, G4S said: "We have been made aware of a fraudulent website and press release purporting to be from G4S plc which has been released to members of the media. The website and the announcement contain wholly inaccurate information.鈥�
The website, using the domain g4s-plc.com, was registered to an address in the Netherlands under the bogus name 鈥楽ikko van der Donk鈥�.
An anonymous statement has since been circulated claiming responsibility for the hoax. It said the hoax was carried out against G4S because 鈥渋t is one of the many companies collaborating with and enforcing the European border system鈥�.
The press release, purporting to be from the press office of G4S, was distributed to journalists via email on 12 November. Its contents were then picked up on Twitter, causing its share price on the FTSE 100 to drop, hours after the company issued a positive trading update.
G4S shares, which had risen during intra-day trading following the update, ended the trading session up 2.1 percent. Shortly after the press release was distributed, the stock fell marginally before recovering.
The drop caused some commentators to suggest that short sellers were behind the hoax, but data from SunGard鈥檚 Astec Analytics showed that short selling volumes have actually decreased around 10 percent from more than 35 million shares on 6 November to around 32 million on 13 November.
This was in line with an expectation of more positive trading news from G4S. David Lewis, senior vice president at SunGard鈥檚 Astec Analytics, said: "The data suggest that this is not a short selling plot, but simply mischievous behaviour from unknown quarters."
The fake press release claimed that accounting errors meant that G4S had recorded net losses for both 2013 and the first six months of 2014.
Journalists soon discovered that the press release was false, as it contained missing words and spelling mistakes, as well as the name of a press officer who no longer works at G4S.
The press release included a telephone number for an automated answering service, which ran a message informing callers that the press office鈥檚 lines were busy, and a link to a copycat G4S website that soon went offline after the forgery was unmasked.
In a statement, G4S said: "We have been made aware of a fraudulent website and press release purporting to be from G4S plc which has been released to members of the media. The website and the announcement contain wholly inaccurate information.鈥�
The website, using the domain g4s-plc.com, was registered to an address in the Netherlands under the bogus name 鈥楽ikko van der Donk鈥�.
An anonymous statement has since been circulated claiming responsibility for the hoax. It said the hoax was carried out against G4S because 鈥渋t is one of the many companies collaborating with and enforcing the European border system鈥�.
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