Apple hit by Jobs health rumour

2008-10-04 11:03

San Francisco - The US Securities and Exchange Commission is investigating the motive behind a false report on CNN's citizen journalist website on Friday that Apple's chief executive Steve Jobs had suffered a heart attack.

The report sent the company's stock on a roller coaster ride. Shares fell 5.4% on Friday morning after the posting on iReport.com cited an anonymous source who said Jobs was rushed to the hospital after suffering a "major heart attack".

The report followed months of concern about the health of the iconic company founder and CEO who had surgery four years ago to treat pancreatic cancer.

The share price rose after an Apple representative vehemently denied the report and CNN deleted it from its iReport section, which it bills as a place for "Unedited. Unfiltered. News".

The cable news channel says it "makes no guarantee about the content or coverage" on the site.

Financial motive?

The SEC said it was investigating whether there was a financial motive in posting the report, which would have allowed an investor to make millions of dollars by shorting or short selling the stock - selling borrowed shares and betting on repurchasing them later at a lower price.

CNN said it would co-operate with the investigation.

This was the second recent case in which a false internet report was responsible for a deep decline in the stock price of a major company.

Shares in United Airlines briefly dropped more than 92% in early September after Google's automatic news page picked up a five-year-old story on the company.

- DPA