Stock Message Board Poster Elgindy Faces Jail Time Following Guilty Plea

A federal case against a high-profile message board stock-picker wound to a close last week when Anthony Elgindy pleaded guilty to a fraud charge.

The conviction renews credibility questions about the self-styled scam-stock vigilante, whose brushes with securities regulators have been chronicled here in the past. But the latest development only reinforced his followers' faith in Elgindy, a San Diego-based short-seller who gained notoriety for his colorful posts on stock message board Silicon Investor.

Elgindy, 32, pleaded guilty on Feb. 24 on one count of mail fraud under a nine-count indictment handed up last year to the U.S. attorney for the Northern District of Texas. The charges related to checks Elgindy allegedly received from Bear Stearns (BSC) and Barron Chase Securities while he was simultaneously receiving disability benefits from MassMutual. A trial was to begin this month on the charges.

Elgindy, who faces sentencing on May 15, is likely to do about six months in prison, followed by probation, Assistant U.S. Attorney David Jarvis says. Elgindy's lawyer didn't immediately return calls seeking comment.

Elgindy goes by the handle "anthony@pacific" on the message boards and is a former Nasdaq market maker and retail broker who claims to uncover scam stocks. But the fraud charges raised questions about his credibility, as did a fine leveled against him in 1997 by the National Association of Securities Dealers, and the revocation of his NASD registration in 1998.

In a statement posted Thursday morning on Silicon Investor, Elgindy wrote, "I gave up fighting. I capitulated and accepted a deal, stating that while suffering from Severe Depression in 1994 I accepted approx 50K in disability benefits, that I was not entitled to. ... Since I now accept this guilt, I'm hoping that you can also."

But Elgindy's faithful followers, many of whom Elgindy had attracted on his thread on Silicon Investor and who later joined Elgindy at his private, for-pay stock-picking site launched last May, were unfazed. "I don't know one person who doesn't have skeletons in his/her closet," wrote jjetstream.

"There is no higher calling in life than to be a teacher," wrote Cube. "Yeah, you've made us all a ton of money, but most importantly you have taught us. That is something none of your critics can claim."

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