Newsforge & GrokLaw report that “Although the Securities and Exchange Commission (SEC) never officially makes public when it investigates an organization, an SEC staff member told NewsForge that complaints and tips about suspected under-the-table funding, stock-kiting, illegal insider trading, and money-laundering involving Microsoft or Microsoft-connected individuals to the financially struggling SCO Group have been coming into the agency with regularity since last August.
Microsoft and SCO Being Investigated By the SEC?
About The Author
Eugenia Loli
Ex-programmer, ex-editor in chief at OSNews.com, now a visual artist/filmmaker.
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the DOJ would get off Oracle’s back and start pursuing actions against a REAL MONOPOLY!!!
Someone just lifted up the corner of the slimy rock and got a glimpse of a big, ugly bug up under there. Yuck!!! When a company decides that litigation is a substitute for innovation they are headed for a big fall. Microsoft may have a lot of politicians in their pocket, but in my America good wins out in the end…sometimes it takes a while, but the system can work like it was designed to. That isn’t to say it couldn’t use a tune up, but it can function still.
[Overheard from a drunk driver pulled over]
Yeah! Now why don’t you go chase some REAL CRIMMINALS?
Anyway I can’t say that I’m surprised by this happening. The only thing is why did it take so long?
That always amused me as well. The DoJ made an arguably unnecessary leap to stop Oracle from becoming a pontential monopoly. Yet, Microsoft, the very definition of an abusive monopoly exists for years wish nothing but a few slaps on the wrist.
Not that anything will come of this. When world governments are afraid of negatively affecting a single company, that shows there is a very large problem. The World’s emerging technology industry is far too centrally focused on Microsoft.
Imagine if one corporation was globally involved in some aspect, usually a very significant one, of the production of 90% of automobiles.
Yeah! Now why don’t you go chase some REAL CRIMMINALS?
Because I have too much h/w and MS bashing to do. 🙂
I had the same thought a couple of days ago reading a cnet article about the Oracle-PeopleSoft antitrust case.
There’s a lot of competition in Oracle’s market – also after a merge. But there’s no competition in MS’s market asis. Shouldn’t the focus be on a MS split rather than the Oracle-PeopleSoft merge?
It is not world governments afraid of attacking Microsoft it is just the US. Israel has recently had a few words with them regarding no Hebrew support in Office for OSX. The European Union is still looking at forcing Microsoft to remove Media Player from their OS. Microsoft only has power in the US becuase thats where all their roots are. In the past they have gotten away with some bullying in other countries but that was due to ignorance. The price difference with Linux has finally brought that ignorance to light.
So this is a basically a report on a rumor that the SEC has been getting tips and accusations that Microsoft is somehow giving money to SCO to attack Linux.
And HOW exactly does a rumor of the SEC getting reports on Microsoft being connected to SCO translate to: “Microsoft is being investigated by the SEC for money laundering and underhanded funding of SCO”?
Is it surprising that the SEC is getting all sorts of reports of this nature? No. There are enough Linux using conspiricy theorists that it would be strange if the SEC *didn’t* get such reports. These days a better name for this site would be “OS rumors and armchair opinions”.
So this is a basically a report on a rumor that the SEC has been getting tips and accusations that Microsoft is somehow giving money to SCO to attack Linux.
note the question mark eugenia put to indicate it may well just be a rumour but so far,
There has been a leaked memo that proves MS has been bankrolling SCO, neither SCO or MS have denied it.
Newsforge have asked the SEC if the are investigating and an insider has confirmed that they are, read the Newsforge article.
And HOW exactly does a rumor of the SEC getting reports on Microsoft being connected to SCO translate to: “Microsoft is being investigated by the SEC for money laundering and underhanded funding of SCO”?
read the comment above.
Is it surprising that the SEC is getting all sorts of reports of this nature? No. There are enough Linux using conspiricy theorists that it would be strange if the SEC *didn’t* get such reports. These days a better name for this site would be “OS rumors and armchair opinions”.
Yes indeed, but the conspiracy theories are becoming reality, Newsforge, is going to be investigating the money trail,
the halloween X leaked memo shows real connection between microsoft and sco.
So yes this should be published by osnews, as it is more than just rumours now.
This topic will be interesting to say the least.
First off…
We all know that serious injustice exists in this world. Money, power, politics and corruption play hand in hand every day… and it’s getting worse.
Here’s my question to everyone (even myself)…
Why do we put up with it?
What is to prevent the open comunity from being a voice for truth and positivity for our future?
The 60’s changed the world, why can’t we?
For everyone who wonder what is the relation between Microsoft and Baystar just follow the detail:
– Paul G. Allen : cofoundator of Microsoft. he still holds 213 millions of shares of msft (microsoft) – it’s 5.5 billion dollars
http://www.forbes.com/finance/lists/10/2003/LIR.jhtml?passListId=10…
-Vulcan Capital Inc: created by Paul G. Allen in 1986 to manage his personal and professional endeavors
http://capital.vulcan.com/
-Baystar Capital: an investment company
according to Baystar document from 1995 to 10/2002, Vulcan Capital invested for 1.8 billons dollars. And Vulcan Capital is the main investor of Baystar
http://www.baystarcapital.com/public/pdf/BayStar White Paper October 2002.pdf
The SCO memo leak about microsoft funneling money to SCO is probably just a sign of things to come. When things get tought, and they will, SCO will turn on microsoft just like they’re turning on their own customers. SCO will spill thier guts to the SEC once federal charges are brought up and microsoft will feel the consequences of doing business with SCO.
i believe that sco used to be called caldera which
was owned partially by microsoft…
I don’t think much will come of this MS-SCO connection. MS would love nothing better than to see the distraction of a big IP battle where typical customers are scared of being sued or forced to pay a license for previously free/lowcost software. MS might be sneaky but they’re not reckless, and even if they did do something that the DoJ considered illegal or unethical, MS’s warchest of $50+ billion can help convince Congress that MS are the real victims and that OSS is dangerous. SCO will implode but not if companies like EV1 and CA keep taking licenses from SCO which can be used as evidence to bolster SCO’s IP claims.
I don’t think the US can duke it out with MS the way some other countries, even the tiny ones, can. The US is more than willing to go after the Oracles or AT&Ts of the world because they simply don’t have the influence (read: money/lobbyists) that MS does. Even with an Oracle/PeopleSoft merger, you still have many good database options (DB2, SQL Server, MySQL) and a zillion ERP ones.
Personally, I think the only entity that can effectively take on MS is IBM.
There has been a leaked memo that proves MS has been bankrolling SCO, neither SCO or MS have denied it.
I read that letter, and it doesn’t prove anything. ESRs speculation went like this;
Letter: “Microsoft referred Baystar to us (SCO) and that was good”
ESR: “Microsoft is giving money to SCO to attack Linux”
And many similar unreasonable jumps. Microsoft has been licensing SCO ip long before any of this started due to their services for UNIX product, so yes, they bought from SCO, but so did SUN and IBM. And both SCO and Microsoft released statements basically saying exactly what I said about the situation, the letter was misinterpreted. Hardly proof of anything.
Newsforge have asked the SEC if the are investigating and an insider has confirmed that they are, read the Newsforge article.
A) Regardless of the itegrity of newsforge, an anonymous insider tip is still rumor.
B) The tip did *not* say that there is an investigation. The insiders comment was only that the SEC was recieving complaints and that they did not take such matters lightly. This is a pretty weak insider tip. Since they were anonymous, why not just come out and say “SEC is investigating”?
So yes this should be published by osnews, as it is more than just rumours now.
No, it’s still just rumor. It would be interesting if it were true, but I don’t see any reason to believe any of it yet. OS news should not be publishing this nonsense.
MS is engaged is more unethical conduct but is it illegal. Did MS pump up SCO’s stock to benefit from it? i don’t think so.
I really don’t know but it looks to me like SCO might be guilty of SEC fraud not MS. I even wonder if this has any LEGAL relevance to the antitrust case. It is evidently relevant but building up a LEGAL case is another matter.
“…complaints and tips about suspected under-the-table funding, stock-kiting, illegal insider trading, and money-laundering involving Microsoft or Microsoft-connected individuals to the financially struggling SCO Group have been coming into the agency with regularity since last August.”
That “August” is about the same time the Slashdot crowd started getting whiff of the possible story. Personally, if it comes off of Slashdot you have to take it with a grain of salt until you research it yourself. Too bad the SEC doesn’t know that.
This will all come to nothing. Trust me.
Imagine if one corporation was globally involved in some aspect, usually a very significant one, of the production of 90% of automobiles.
Bosch is all I gotta say.
“Bosch is all I gotta say.”
Bosch faces quite a bit of competition in virtually every aspect of the automotive market they address. Ever heard of Delphi for instance or TRW?
I had the same thought a couple of days ago reading a cnet article about the Oracle-PeopleSoft antitrust case.
There’s a lot of competition in Oracle’s market – also after a merge. But there’s no competition in MS’s market asis.
MS and Oracle are competitors to a large extent (though from Oracle’s point of view MS is more of a competitor than Oracle is from MS’ point of view, simply because Oracle doesn’t have a large diversity in their product line). Oracle’s products also tend to run about 100x the cost of competitors.
Shouldn’t the focus be on a MS split rather than the Oracle-PeopleSoft merge?
On what basis? The government already tried to do it once, spent over 6 years (so far) to do it, and more or less failed to present their case well enough to get through the first appeal. The US government has stepped in to interfere with MS’ attempts to buy other companies on occasion, especially in markets where MS can afford to buy out a competitor that has a significant market lead.
For those that support anti-trust, it makes absolutely no sense to say that the government should drop any action against one company in favour of action against another. It makes even less sense when they’re still spending money trying to press action against that other company.
Well lets see:
you write:
I read that letter, and it doesn’t prove anything. ESRs speculation went like this;
Letter: “Microsoft referred Baystar to us (SCO) and that was good”
ESR: “Microsoft is giving money to SCO to attack Linux”
And many similar unreasonable jumps. Microsoft has been licensing SCO ip long before any of this started due to their services for UNIX product, so yes, they bought from SCO, but so did SUN and IBM. And both SCO and Microsoft released statements basically saying exactly what I said about the situation, the letter was misinterpreted. Hardly proof of anything.
The original memo can be found here without ESR’s comments embedded.
http://www.groklaw.net/article.php?story=20040304174457123
note in the memo it states:
I realize the last negotiations are not as much fun, but Microsoft will have brough in $86 million for us including Baystar. The next deal we should be able to get from $16-20, but it will be brutial as it is for go to makerket work and some licences. I know we can do this , if everyone stays on board and still wants to do a deal. I just want to get this deal and move away from corp dev and out into the marketing andfield dollars….In this market we can get $3-5 million in incremental deals and not have to go through the gauntlet which will get tougher next week with the SR VP’s.
We should line up some small acquisitions here to jump start this if we do it. We shoudl also do this ASAP. Microsoft also indicated there was a lot more money out there and they would clearly rather use Baystar”like” entities to help us get signifigantly more money if we want to grow further or do acquisitions
This Microsoft deal is the Ante to the poker game…We should get this done and go after several $2-3 Million deals from the expense side of their company.
The will help us a lot and if we execute we could exit and Unix componients we have build potentially back to Microsoft or MCS. I think they are on track and may not be able to push much more this round, but there are other ways to get money from them, their partners, investment bank referrals, etc..
Do kepp in mind that they have brough us between $82 million and $86 million if this deal is between $4million per quarter where Rich is at, or it turns into %5 million wjich is the lowest number Chris had interest in.
unclear jumps ?
YOU WHAT ??
but Microsoft will have brough in $86 million for us including Baystar. The next deal we should be able to get from $16-20, but it will be brutial
read that again. Now stop trolling. You dont need ESR to comment on it the memo is pretty clear in what it states, and i fail to see how the memo can be a misunderstanding, when its so undeniably clear what is being stated.
i would say four to five months to do a little looking is a fair amount of time. i gave them a month to get sick of the /.ers and then start. /. may have alot of lets says extreme readers, but if you put your bs filter on (you can see bs when you see it) you can find some interesting points of view. even from the trolls. which i hope i am not feeding.
I dont believe it. Microsoft and SCO’s business practices to date have been nothing but ethical and benifical for the whole industry.
Im sure all parties involved will be found completly innocent.
** Right after they buy off everyone investigating them **
While linux and other OSS has been acknowledged by MS as a threat, why would they risk so much (financially/legally) for what is obviously a VERY lost cause (SCO)? I personally would think the legal battallion at MS is much smarter than that, there is simply no way they would put this much at stake. If the general public knows SCO is full of shiiite, then for sure MS sees this as well. It simply wouldn’t be worth their time to funnel $$$ to SCO, the risks are simply too great. which brings up an interesting point b/c as has been mentioned already, there really is nothing illegal about MS pumping money into SCO, and we all know how quick MS is to stand by any morals. just my 2 .02
jayson knight…
do you really think that MS putting a few mill into the SCO support fund for this whole fiasco will even dent MS’s financial status?
i don’t think so.
even more relevant… MS using SCO as a desperate pawn to wield the MS fud against OSS.
SCO takes the fall, not MS.
MS ain’t no dummies!
Newsforge receives an anonymous note from a member of the SEC which makes it clear that this is being investigated. Given OSnews.com posts other SCO-related things which are also based on “rumors” and “unproven remarks” i think this fits in that style. Personally, i’d rather not read about it (here), but its either 1 or 0. Not then yes, and then no. Be consistent.
Anyone who asked the SEC to do that (“slashdot readers” or “groklaw readers”) aren’t necessarily certain that there’s a connection. They could however stated arguments, logic, facts, signs, etc which could have investigated this. I hope that a government organisation doesn’t listen to the number of people who complain about something, but rather to their arguments.
The fact that SEC now investigates this, proofs nothing (yet). It doesn’t prove guilt. It means just that, it’s being investigated. It is simple: “innocent until proven”. When applying the same logic, Linux is clean until “it”. has been proven guilty.
Those who wish not to see rumors, shouldn’t read about any SCO related news about what ie. SCO BELIEVES to be their IP. This hasn’t been proven either. Those OSnews.com readers should also complain about it in SCO threads, at least, when they’d wish to be perceived as consistent. I haven’t noticed the latter by A.K.H. Why not?
Man in the middle == BayStar / S2
Article: http://www.newsforge.com/trends/04/03/09/0036215.shtml
Today, Business Week has confirmed that Microsoft indeed did call BayStar to ask if they’d invest in SCO. It wasn’t Bill Gates personally, but did you think it would be or needed to be? Here’s the scoop:
http://www.groklaw.net/article.php?story=20040310211615504