The Five Dumbest Things on Wall Street This Week

1. A Fraud He Went a-Courtin', Uh-Huh

We at the Five Dumbest Things Research Lab tend to wax indignant over schemes to scam investors out of millions of dollars. But this time around, we'll make an exception.

The beneficiary here is one Paul Tetu, described by the Securities and Exchange Commission on Thursday as a 63-year-old "aspiring screenwriter, novelist and movie producer."

For the past five years, says the SEC, Tetu has been placing advertisements in The Wall Street Journal and other newspapers promising investors annual risk-free returns of 70% to 100% through "exclusive secret trading programs."

The investment Tetu advertised, says the SEC, was a total fraud. That, of course, makes us feel awful bad for the people who sent their money to Tetu to invest.

Except for one thing. According to the SEC, no one ever sent Tetu money. Not once in the past five years. About the only thing he ever cheated people out of, we suppose, was the money they spent on their long-distance bills when they called him up to chat.

Now, is that pathetic or what? We just lived through one of the biggest market bubbles in recorded history -- one in which people fought tooth and nail for the right to invest in publicly traded crud that flamed out within months -- and this guy couldn't scam a single person over five years? What a loser.

Curious to know what the secret of this guy's nonsuccess was, we left a message for the only Paul Tetu listed in California. He didn't get back to us. Maybe the hurdle for Tetu's potential victims was the $10 million minimum investment the SEC says he asked for. If he really wanted people to blow that kind of money, he should have hired a real Wall Street investment bank to do the job.

2. Going to Meet the Man

Underperforming and overpaying software company Siebel Systems ( SEBL) has come up with a novel way to avoid shareholder wrath at its annual meeting: not hold an annual meeting.

Well, not exactly. As the San Jose Mercury News pointed out Thursday, the company is holding its annual meeting on the Internet, making it the first decent-sized company in the U.S. to do so.

In theory, this is a good thing. As Siebel points out in its proxy statement, holding the meeting as a Webcast has several advantages. Shareholders who don't live near the company's Silicon Valley headquarters can attend without incurring travel costs. An online meeting saves money. And a Webcast can be replayed by shareholders who can't attend in real time.

Of course, as the Merc notes, there are other benefits to Siebel management, chiefly that shareholders won't be able to confront them face to face about a number of embarrassing issues: the stock's 63% dive, CEO Tom Siebel's options-juiced compensation, a compensation-related shareholder lawsuit and a possible recidivistic violation of the SEC's Regulation Fair Disclosure.

Shareholders still will be able to ask questions -- as long as they fax or email them to Siebel ahead of time -- but without the lip-quivering, confrontational drama we suppose many of them were hungering for. "The number of questions that we will be able to address during the meeting may be limited," says Siebel.

Yes, on the Internet, people might know your stock is a dog. But they can't tell you face to face.

3. Can We Speak Frankly?

Disgraced former Tyco International ( TYC) director Frank Walsh is a felon. He intentionally concealed $20 million in payments that Dennis Kozlowski's onetime piggybank made to him and to a charity with which he served.

But he didn't commit fraud, apparently.

As Reuters reported this week, Walsh's publicist, likely seeking to preserve what's left of Walsh's money and dignity, sent letters to Reuters and Business Week, asking them to refrain from describing Walsh's criminal activities as "fraud" in future news accounts.

The publicist and Walsh's lawyers insist that what Walsh pleaded guilty to was not fraud. Evidently, if you're a director and you hide -- from both shareholders and fellow directors -- $20 million in fees you've received for a deal your company has done, that's not fraud. Apparently, it's a violation of New York's general business law.

Oh, just shut up. Shut up. Go away.

Makes us wonder how far Paul Tetu could have gone if only he had some professional legal help.

4. Do We Decimal?

SEC Chairman William Donaldson dropped a bomb this week when he told CNBC he wanted to reconsider the market's transition from fractional share prices to decimalization.

"I think the whole issue of decimalization needs to be looked at," Donaldson told Ron Insana.

"The total cost of transactions, I suspect, has increased. And I suspect the liquidity that used to be in the market ... has been severely dampened by these very narrow spreads. And I think that the whole issue really needs to be looked at.

Stop, Chairman Donaldson! This might help the stock market's liquidity, but do you have any idea how it will tax the brains of all the English-majors-turned-reporters who are covering the market? Have you ever tried to subtract 1 7/8 from 20 1/16 with nothing more than a liberal arts education?

We at the lab are sure that we could pass the hat among all the business journalists in America and come up with, oh, $20 million in undisclosed payments for keeping the status quo. It wouldn't be a bribe, of course. What it would be is, well, uh ... we'll just have our publicist get back to you on that one.

5. Will You Blair Your Soul for the Camera?

As you've no doubt heard, the reputation of The New York Times ( NYT) has suffered some serious damage this week, thanks to the fabrications of ex-reporter Jayson Blair and their aftershocks.

Unfortunately, Blair wasn't the first reporter to cross the line between journalism and fiction without bothering to tell his editors. Reporters who seek to improve upon reality are a recurrent problem in the newspaper business.

Fortunately, we at the Five Dumbest Things Research Lab have figured out a way to have fun with this. We suggest transforming reporters' misdeeds into entertainment. A TV show, to be exact.

And what type of show is more appropriate to explore the complex interaction of fact and fiction than ... reality TV? Is Survivor real or make-believe? What about a Jayson Blair report quoting unidentified sources about the D.C. sniper? We're talking different media here, but they're the same old story.

So here's what we propose: Gather up a handful of outcast ex-reporters. Instead of making them eat rats on a remote island, give them a job. A second chance. A tryout position at a big-city daily newspaper.

Like all good reality TV shows, this one would be cruel. For starters, six unemployed people would be competing for a single job. And to heighten the on-camera tension, each reporter would be given nerve-wracking, pressure-filled assignments. High-profile stories. Stories about intensely private public figures. Stories that are impossible to report without anonymous sources. In other words, assignments that offer easy opportunities for made-up sources and made-up quotes.

It's the journalistic version of Temptation Island.

In the final episode, the person who has written the most entertaining dispatches without making stuff up -- or without getting caught -- gets the job.

The idea is perfect, we figure, for Rupert Murdoch's News Corp. ( NWS). The reporters would work at Murdoch's flagship U.S. paper, the New York Post. The TV show would run on Fox, the network that brought us Joe Millionaire. This show has "synergies" written all over it.

Our working title for the show is either "Write and Wrong" or "Going Postal."

People usually pay dearly for our research. But Rupert, this time we'll skip our regular $20 million fee.

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