Man Faces Five Charges in PairGain Web Hoax

A 25-year-old North Carolina man was indicted on five counts of federal securities fraud Friday for allegedly perpetrating an online hoax against Tustin-based PairGain Technologies Inc. Gary Dale Hoke of Raleigh, an employee of PairGain, is accused of creating a fake Bloomberg News Service Web page to fool investors into thinking that PairGain was being acquired by an Israeli company. The company’s stock went up sharply on the report, which fooled many investors. The indictment listed five victims, although it is unclear exactly how many investors were deceived. Hoke is scheduled to appear in a Los Angeles federal court for arraignment May 10. If convicted, Hoke could face up to 10 years in federal prison and a $1-million fine, depending on the losses attributed to the fraud. Hoke already faces two civil lawsuits, one from Bloomberg News and another from the Securities and Exchange Commission.