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FBI Makes Arrest in Emulex Hoax

Federal agents have taken one person into custody in connection with the hoax that sent shares of Emulex on a rollercoaster ride last week.

The Federal Bureau of Investigation has arrested Mark Jakob, 23, of El Segundo, Calif., for allegedly sending out a false press release regarding the networking company's financial condition. Authorities said Jakob made almost $250,000 in trading profits.

The arrest comes after a fake press release issued over Internet Wire was picked up by several credible news organizations, sending Emulex shares into a 50-point trading range. As much as $2.5 billion was shaved off of Emulex's market capitalization before recovering.

Jakob is a former employee of Internet Wire and had no ties with Emulex.

In a statement, Emulex said it was gratified with the "swift actions" taken by authorities and warned others of contemplating similar assaults.

"The matter received immediate and focused attention from both law enforcement agencies and multiple securities' exchanges. The quick results from this cooperative effort demonstrate to others contemplating a similar hoax that the outcome to be expected is immediate apprehension and prosecution," said Paul Folino, president and CEO, Emulex.