Wednesday, December 16, 2009

Patrick Byrne's Facebook Pretexting Lasted Seven Months


Byrne hard at work at his day job: stalking his critics and their families

(Updated with length of scheme corrected. See this update on Facebook expelling Overstock's pretexting guru Judd Bagley.)

I've been perusing the wreckage left behind from "Larry Bergman," the phony Facebook account used by Overstock.com CEO Patrick Byrne in his pretexting and identity theft scheme to stalk critics.

What I've found was that this pretexting scheme was the full time occupation of his creepy cyberstalker, the nauseating Judd Bagley, for the past seven months. Bagley went to elaborate lengths to establish an alternate identity, doing everything from creating a fake Twitter ID to using the stolen, copyrighted picture of a well-known Italian art critic to establish his identity.

Among the tidbits I've found:

1. "Bergman" was fabricated seven months ago to stalk whistleblower Sam Antar and his family.

As best as I can tell -- if anyone knows differently, please let me know -- Sam was his first target back in May, seven months before Byrne's pretexting chief Bagley loused up so badly that a little checking revealed that "Bergman" was a phony.

Sam is the former CFO of the Crazy Eddie stock swindle, a convicted felon who has devoted his life to fighting white collar crime. He has exposed on his blog systematic financial fraud at Overstock.com, in particular how Byrne created a "cookie jar reserve" that he used to create earnings where there should have been a loss. Sam single-handedly prompted an SEC investigation into those very issues.

Byrne's henchman Bagley (right), a glassy-eyed p.r. hack and ex-Florida Republican dirty-trickster, began stalking Sam through "Bergman" in May 2009.

At that time, Byrne knew that Sam had been sending emails to the SEC ripping apart the company's phony financial statements. Overstock board member Joseph Tabacco was cc’d on those emails.

Tabacco is on Overstock's audit committee, and he fulfilled his role handsomely: he forwarded the emails to Byrne, and went right back to sleep. This was immediately before the SEC opened its investigation.

Therefore, Byrne was attempting, through pretexting and identity theft, to spy on an independent whistleblower that he knew was communicating with the SEC.

After he succeeded in "infiltrating" (to use Byrne's words), the Facebook "network" of "miscreants" headed by Sam, Byrne then had Bagley target Sam's son, a kid in his twenties.

From: Facebook

Sent: Monday, June 08, 2009 11:36 PM

To: xxxxx Antar

Subject: Larry Bergman added you as a friend on Facebook...

Larry added you as a friend on Facebook. We need to confirm that you know Larry in order for you to be friends on Facebook.

Larry says, "Hi xxxxx I'm a friend of Sam's.".

To confirm this friend request, follow the link below:

http://www.facebook.com/n/?reqs.php&mid=97xxxxxxxxxxxxxxx

Thanks,

The Facebook Team
When Sam raised the issue with Bagley on a message board after the scheme fizzled, Bagley responded in his typically big-hearted way: "Time to cut the apron strings, don't you think?"

Bagley continued to work the"Bergman" charade through the summer and into the fall and winter. He tried to gain Sam's confidence on Nov. 4 by posting a sympathetic question concerning this blog post, which described how Byrne refused to take questions from Sam at a quarterly conference call.:
Sam, did you email your questions to Overstock IR guy Kevin Moon beforehand? If so you have good reason to be bothered.
What's ironic is that this is the first time I've ever seen this psychopath utter anything that wasn't a lie or dishonest spin. And he did it posing as a "friend" of Sam's, trying to work his way into the "Facebook conspiracy."

2. The Facebook pretexting scheme targeted Marc Cohodes -- a hedge fund manager who was being sued by Overstock -- and (of course) his family.


Bagley has long claimed to have severed his connections with Overstock. He had been corporate spokesman before joining the ostensibly independent website "Deep Capture" in 2007. But that was actually an astroturf site, financed by Byrne, owned by him through corporate shells, with its content aimed almost exclusively at smearing critics of Overstock and Byrne. By targeting Cohodes, who was involved with a dispute with Overstock, any pretense of independence went out the window.

"Bergman" stalked Cohodes on Facebook in mid-November, and when that failed he went after Cohodes' wife and daughter, an 18-year-old college student, all of this while the litigation was still pending. It was settled earlier this month. (Bagley did the same thing with me, "friending" my wife in early December shortly after she posted on her page that I was her husband. Bagley was watching me that minutely.)

It takes a special kind of douchebag to stalk the wives and kids of your critics and adversaries. Bagley and Byrne are that kind of douchebag.

I think you can imagine the shit storm that would have developed if some hireling of Cohodes had stalked Byrne, his family members, or Bagley's wife and kids. You'd have the entire Utah congressional delegation up in arms. They'd have quit sabotaging the Obama health plan long enough to get the SEC and FBI to put Cohodes on the hot seat.

Bagley, again functioning in a p.r. capacity for Overstock, yesterday posted an elaborate presentation on his "antisocialmedia" website (another Overstock astroturfing outfit) trying to spin the settlement of the Cohodes litigation.

There is now no daylight whatsoever between Bagley, Byrne's two astroturf websites and Overstock.com. Astroturfing is not only the lowest form of life in the p.r. industry, it is fraudulent conduct because it presents corporate p.r. as "independent" coverage. Doesn't the SEC have rules against fraudulent conduct?

3. Byrne had my Facebook account under tight surveillance.

My Facebook account was inactive until Dec. 4, when I activated it in order to connect with some friends who recently moved abroad. There was a flurry of activity from Dec. 7-12, as I added several dozen Facebook friends, and then, bingo! Byrne's thug Bagley tried to get me to friend the phony "Bergman" account on Dec. 10.

What this means is that Bagley -- he is paid to do this full time by Byrne, remember -- was closely watching my Facebook account, noticed the sudden spurt of activity and then pounced, hoping that I would accept him as a "friend" without noticing:




This friend request came to me a few hours after I wrote a post on the outrage that had greeted posting of Byrne's enemies list on the corporate p.r. site. The timing of the invitation to me was typical of the narcissistic Bagley. He's smarter than anyone else, you see.

True. He's so smart that he has singlehandedly destroyed what was left of his and his boss's reputation.

In the past few days we've seen the most ridicule I have ever seen directed toward Wacky Patty, including a serious effort to boycott the company and criminally prosecute Byrne, spearheaded by financial blogger Barry Ritholtz.

Ritholtz, and other targets like Felix Salmon of Reuters, had barely uttered a word about Byrne or Overstock. Thanks to the pretexting scheme and the clumsiness of his thugs, Byrne has a whole new tranche of people who would like to see him and Bagley put in jail.

Byrne has been desperately scrambling since his pretexting scheme was exposed. He backpeddled furiously, reducing the size of the "conspiracy list" he published on the corporate website, and he and Bagley claimed that the intent was to show that ties between journalists and hedge fund managers were too close.

But if that were the case, Byrne would have pursued media people and bloggers who cover hedge funds. He didn't. That flimsy lie is contradicted by the fact that he only stalked media people and bloggers (and the family members thereof) who had been critical of Overstock.com. Some had nothing to do with hedge funds, such as Eric Savitz of Barron's, who covers the tech beat, which includes Overstock, and occasionally has made mildly critical references to the company.

Byrne omitted from his hit list all of the hedge fund beat reporters for the New York Times, Wall Street Journal, Bloomberg, Forbes, Fortune and BusinessWeek. Hey, it's good he didn't: a half dozen fewer reporters stalked. But he included an obscure but talented newsletter writer and blogger named Chris Faille, who has occasionally written critically of Overstock. What all this proves is the true purpose of his pretexting scheme -- to stalk media critics of Overstock.com.

In fact, he went after media people who are critical of hedge funds: myself, John Carney and Felix Salmon, to name a few. I've been critical of the hedge fund industry for years, and devoted much of Wall Street Versus America to excoriating the hedgies. Sam Antar, of course, is not a media or hedge fund guy. He's a whistleblower who has nailed Overstock's accounting, pure and simple.

Journalists and bloggers who stayed away from Overstock, and the few deemed friendly of course, were left alone. Byrne never bothered throwing in people like that for balance, because he never expected his scheme to be discovered.

(Bagley later said that "Larry was just a tool for determining whether or not certain people accept every Facebook friend request." I'm serious. That's like the old joke about the burglar who said he was breaking into someone's house to test their alarm system.)

Bagley, meanwhile, has deleted his former Facebook page. The poor dear is worried about his privacy, you see.

Not to worry. He can put that page right back up. Nobody gives a damn who Bagley "friends" on Facebook (under his real name, that is). Nobody is stalking him, his wife or his kids. Normal people don't do that. Criminals like Bagley and his sicko boss do that.

That's a charitable interpretation of his account vanishing, by the way. The uncharitable interpretation is that Facebook kicked him off for his cyberstalking.

Bad as this is getting for Byrne and his crew, it's going to get a lot worse before it doesn't get better.

I expect Byrne to make more mistakes, to give vent to more anti-Semitic jibes, to engage in more pretexting, more cyberstalking and accounting fraud, to tell more and more lies. That's how he's wired. It will be fascinating to watch.

UPDATE: Based on other corroborative details brought to my attention, I'm now fairly certain that Bagley was kicked off Facebook.

What that means is that Facebook is not pleased. I wonder if this is the end of it.

© 2009 Gary Weiss. All rights reserved.

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