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Arrest of Couple Spotlights Work of Task Force on Internet Fraud

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The scam allegedly perpetrated by an Aliso Viejo couple arrested last week in Florida after a cross-country hunt is just the latest in a wave of frauds leveraging the hottest buzzword going: the Internet.

But while the technology is new, law enforcement officials said that the cons seek to take advantage of two human foibles--naivete and a hope of sharing the wealth being generated by the dot-com companies that have gone public.

“This is something where not only this office but law enforcement nationally is committed to pursuing,” said Christopher Painter, an assistant U.S. attorney who coordinates Internet fraud investigations in the district covering Orange, Los Angeles, Ventura, Riverside, San Bernardino and Santa Barbara counties.

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Painter’s office is part of a task force formed in 1997 to attack telemarketing fraud in Orange County, including fraud linked to the Internet. The other agencies include the Sheriff’s Department, the district attorney’s office, the U.S. Postal Inspection Service and Anaheim police.

Robert Lewis Syrax, 56, and his wife, Sandra Diane Coronado, 46, were charged with wire fraud in connection with an alleged scheme to defraud investors across the country. The couple ran Gecko Holdings in Irvine and RLS Consulting in Costa Mesa, which authorities said conned people into investing in a nonexistent online gambling venture.

Gecko Holdings used a Web site, as well as more traditional communications, to present itself as a legitimate business, authorities said.

“It’s a lot like getting a glossy brochure in the mail, and you see it nice and printed and you say there must be something to this company,” Painter said.

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When the margins get tough, the tough make capital investments to develop higher-end products and hope the market follows.

Irvine-based Toshiba America Electronic Components Inc. said it will slash its production of 64-megabyte memory chips from 10 million pieces a month to 1 million by the end of this year. In its place, the company will be ramping up production of a faster chip holding twice the memory.

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The change is an attempt to move away from the lower-margin desktop computers that now can be found below $300, a price that squeezes even the most efficient electronic-parts manufacturer.

Instead, Toshiba is aiming to produce chips for the high-end server and workstation market as well as for laptops.

The shift away from the desktop has already started, said Jamie Stitt, dynamic random-access-memory business development manager at Toshiba. Last year, 70% of Toshiba’s memory chips went to desktop computers, down from about 95% the year before.

“Our whole positioning has been to gradually focus on the high end,” Stitt said.

The new chips will be built on a higher-density platform, allowing the company to squeeze more memory into a smaller space and save production costs. The new efficiencies come at a high cost, although Stitt declined to say how much Toshiba spent on manufacturing alterations.

The memory market has recently shown signs of coming out of the slump caused by oversaturation, with prices inching up for the past three quarters.

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Jonathan Gaw covers technology and electronic commerce for The Times. He can be reached at (714) 966-7818 and at jonathan.gaw@latimes.com.

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