Paid blog posts may put Accoona's IPO at risk

Saul Hansell of the New York Times was surprised when numerous blogs chastised him for his coverage of search engine/electronic retailer Accoona and the questionable history of its founder, a felon sometimes known as Armand Rousso, as a stamp dealer and stock promoter. Why would anyone bother to defend such a questionable man and such a negligible company? Because they're apparently getting paid to do so. Most of the blog entries openly label themselves as paid posts — a practice that is itself highly controversial. What's even more controversial is who is footing the bill for these sponsored testimonials. Regardless, Accoona is likely to pay for them in the end.

Hansell reports:

Valentine Zammit, Accoona's chief executive, said that company had nothing to do with the posts. He added that Accoona's employees, directors and consultants aren't supposed to be touting its stock while the company is trying to sell shares to the public.
Nevertheless, someone is, in fact, touting the company via paid blog posts. With his lack of response to Hansell's call for comment, Rousso is making himself a prime suspect. Technically, he is not an employee. Accoona's prospectus goes a long well to spell this out:
Armand Rousso, one of our co-founders together with CDIC, and one of our significant stockholders and an option holder, is not and never has been employed by us or any of our subsidiaries, and has not been a director or officer of us or any of our subsidiaries since October 5, 2004.
However, it also makes it clear that he is a consultant:
Mr. Rousso has been connected with us only by virtue of ... being an officer, director, employee and the sole stockholder of S.P.B.D. Consulting Corp. ("SPBD"). SPBD provides consulting services to various companies in which Mr. Rousso is an investor, including us...
It's hard to imagine someone paying bloggers to promote Rousso and Accoona out of the goodness of their hearts. The most logical suspect is someone with an interest in burnishing Rousso's reputation and Accoona's IPO prospects — someone, in other words, with a financial interest in the company and its IPO attempts. Far from greasing the way for Accoona to go public, these paid postings are likely to throw up a major roadblock.