The Department of Trade and Industry is investigating allegations that a director of a technology investment company attempted to ramp its share price at the peak of the internet bubble.
The probe centres on remarks by Mark O'Hanlon, then chief executive of Monticello, an internet incubator fund popular among private investors and day traders, in an interview with an internet news site.
At the time, the stock had to be suspended from Ofex, the lightly regulated unofficial stock market where Monticello was listed, but dealing recommenced within days and the stock later soared in value more than ten-fold.
Mr Hanlon was interviewed on a financial website, the now defunct uk-iNvest.com, in January 2000. In the interview, according to the Ofex authorities at the time, Mr O'Hanlon made a forecast for the company's share price and stated that the company would move to AIM, where a more liquid market would help its shares.
The company was forced to retract the share price forecast and predictions it would make 50 investments within three months – a view that turned out to be wide of the mark.
"Mr O'Hanlon's view that the share price could be between £5 and £7 by June is his own and should not be considered as being the view of the board," the company said.
The DTI has written to shareholders and others to request information about the January interview and the response to it. It is already understood to have taken statements from a number of people.
One shareholder who had been interviewed said: "Mr O'Hanlon's statements on uk-iNvest flew round the bulletin boards in minutes. We had been hearing rumours it was doing lots of deals but here they were apparently being confirmed by the chief executive, who was saying the shares were going to be worth £5 to £7 and be quoted on the AIM market. Everyone thought they would like a piece of that and dived in, but it all seemed to go downhill from there."
Attempts to contact Mr O'Hanlon over the weekend failed, but at Monticello's annual shareholder meeting in 2000, he was quoted as saying he had been a "prat" and got carried away in the interview.
Monticello was set up in 1996 to commercialise a new technology for extracting zinc and other metals from sulphide ore but, as the internet bubble inflated, turned its attention to what it called "corporate venturing".Reuse content