 March 25, 2001Jonathan Lebed's Extracurricular ActivitiesMichael Lewis's article (Feb. 25) obscures a simple fact: what Jonathan Lebed did was illegal. Lebed published baseless ''recommendations'' with respect to thinly traded securities. His objective in making these recommendations was to cause the stock prices to rise so he could personally profit. This type of stock fraud is hardly victimless. When a stock price rose from $1.38 to $4.69 on the strength of his false recommendations, then fell to $1.88 after his manipulation stopped, there were winners and losers. Lebed, through his fraudulent conduct, ensured that he was among the ''winners'' who bought at low prices and sold at inflated high prices. Many others, who purchased at the height of the manipulation, lost money when the stock price collapsed. Lewis seems persuaded by Lebed's ''everybody does this'' defense, likening Lebed's conduct to that of Wall Street analysts. Nothing could be further from the truth. Analysts do not, as Lebed did, seek to conceal their identities. On the contrary, analysts attach their names, and their firm's names, to their recommendations. Consequently, if analysts' predictions prove unreliable, their reputations suffer. Were an analyst to do what Lebed did -- make baseless recommendations containing unsubstantiated price predictions in hopes of raising the stock price, or encourage investors to buy when the analyst was selling -- the analyst would violate the law as well. No one seriously disputes that Lebed committed securities fraud. His young age is the only interesting footnote in an otherwise unremarkable fraudulent scheme. I note that these are my views and are not meant to reflect the views
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