Shopping.com’s Woes Dog Former Executives
Where are they now: Several former executives of the once-troubled Shopping.com have emerged on the other coast running an Internet search-and-commerce company called BigHub.com in Stamford, Conn., and they are having difficulty escaping their past.
Shopping.com founder Robert McNulty owns a significant stake in BigHub.com, and former Shopping.com Chief Executive Frank Denny is now chairman and acting chief executive of BigHub.
Within days after Denny and other Shopping.com alums took over a few weeks ago, the stock went into free fall, going from a high of $15.25 on May 18 to a low of $5.47 on Friday.
BigHub.com is a network of sites that hopes to draw Web visitors with its iSleuth service, which allows users to find things on the Internet using multiple search engines and directories.
In a statement, Denny attributed the drop to “one-sided” and “negative” editorials related to the history of Shopping.com.
Last year, Corona del Mar-based Shopping.com, an Internet retailer, was at the center of a stock manipulation scandal involving the brokerage that took Shopping.com public. Last month, Cery B. Perle, part owner and former president of the now-defunct Irvine brokerage Waldron & Co., was assessed $110,000 in civil penalties.
Perle, who held a one-third interest in Waldron and controlled its operations, was accused of inflating Shopping.com’s stock through illegal practices that brought in profits of $4.1 million for the brokerage.
Waldron was the lead underwriter in Shopping.com’s public offering in November 1997, raising $11.7 million for the company. In four months, the stock had climbed 255%.
The judge found that much of that gain stemmed from Waldron’s control of 94% of the 1.3 million publicly traded shares. No actions were taken against any officers of Shopping.com, which was acquired earlier this year by Compaq Computer Corp. for $220 million.
Denny took the reins of Shopping.com only after the scandal had played out and was the chief executive when the company was sold. McNulty was both a founder of the company and its first chief executive.
