"Pump and Dump is a great achievement. It is well written and lucid and will be read widely and assigned in classes. It will appeal to white-collar crime scholars, social scientists more generally, and to a general readership."-Kitty Calavita, professor of criminology, law and society at the University of California, Irvine

Enron, WorldCom, Global Crossing-the mere mention of these companies brings forth images of scandal, fraud, and large-scale corruption. But do these dark stars of media stories represent a few isolated cases or does the extensive nature of their misconduct provide evidence of a regulatory black hole in the so-called New Economy?

In Pump and Dump: The Rancid Rules of the New Economy, Robert H. Tillman and Michael L. Indergaard argue that these scandals represent only the symptoms of a corporate governance problem that began in the 1990s as New Economy pundits claimed that advances in technology and forms of business organization were changing the rules. A decade later, it looked more like a case of no rules. Endless revelations of fraud in the wake of corporate bankruptcies left ordinary investors bewildered and employees with little or nothing.

Tillman and Indergaard observe that victims were taken in by organized behavior that calls to mind "pump and dump" schemes where shadowy swindlers push penny stocks. Yet, in the 1990s it was high-profile firms and high-status accomplices (financial analysts, bankers, and accountants) who used powerful institutional levers to pump the value of stock-duping investors while insiders sold their holdings for fantastic profits.

The authors explain how it was that so much of corporate America came to resemble a two-bit securities scam by focusing on the rules that mattered in three critical industries-energy trading, telecommunications, and dot-coms. Free-market hype and policies at the national level set the tone. While Wall Street wrapped itself in star-spangled packaging and celebrated its purported "democratization," in the real halls of democracy congressional allies of business gutted protections for ordinary investors. In the regulatory vacuum that resulted, regulators and auditors who were supposed to watch corporations instead promoted New Economy doctrines and worked with executives to endorse their firms as New Economy contenders. Ringleaders in the inner circles that committed fraud made their own rules, which they enforced through a mix of bribery and bullying.

At a time when there is growing debate about proposals to privatize programs like Social Security, Pump and Dump offers a path-breaking analysis of America's most urgent economic problems: a system that relies on self-regulation and the rancid politics that continue to support the short-term interests of financial elites over the long-term interests of most Americans.

Robert H. Tillman is a professor of sociology and the coordinator of the graduate program in criminology and justice at St. John's University in New York City. He is the author and coauthor of a number of recent books on white-collar crime, including Big Money Crime: Fraud and Politics in the Savings and Loan Crisis. Michael L. Indergaard is an associate professor of sociology at St. John's University in New York City and the author of Silicon Alley: The Rise and Fall of a New Media District.

Contents
Introduction
Chapter One: The Classic Pump and Dump
Chapter Two: The Power Merchants
Chapter Three: Too Much of a Good Thing: The Rats Nest in Telecom
Chapter Four: The Webs They Weave: Dot-Coms and the IPO Machine
Chapter Five: Professional Pumpsters and Financial Engineers: Looking at the Bright Side (Banking on the Dark Side)
Chapter 6: Counting on the Upside: Accountants and Lawyers Who "Got It"
Chapter 7: Forgive and Forget: Responses to Corporate Corruption
Conclusions
Notes
Index