THE first companies to take advantage of the U.S. Securities and Exchange Commission’s new e-proxy process have sent out their notices to investors telling them where to find their annual reporting documents on the Web.
Applied Micro Circuits Corporation (NASDAQ: AMCC), a small-cap technology firm, was the first company to catch my attention when it filed its notice under the e-proxy process with the SEC on Monday, a day after the rule’s July 1 start date.
According to the company’s notice, investors can obtain AMCC’s annual report and its “Notice of Proxy Statement/Annual Report on Form 10-K” not by visiting its own website but by going to the following URL: www.investoreconnect.com
Of course, while you and I are viewing this link on our computers, most AMCC shareholders will be receiving it on paper in the mail. They have to access a computer and then type in the URL in their browsers manually.
I just did that and something happened that probably will happen to more than a few people. I typed www.investorconnect.com and landed on the strange page shown in the screenshot below.
It took me a while to figure out that this wasn’t where I was supposed to be. It’s a spam website set up for the specific purpose of fooling people into clicking on pay per click ads. At first I thought AMCC had misprinted the URL, but I figured out that I misread the URL and typed in investor connect instead of investor Econnect.
How many people do you think will make that mistake? Oh yeah, and whoever owns that spam website must be smiling because they’re going to be making money hand over fist with all the “typo traffic” they’re going to be getting courtesy of Broadridge Financial Solutions, the huge shareholder communication firm that owns the investorEconnect.com domain that shareholders are supposed to use. This past proxy season, Broadridge processed over 156 million pieces. That’s a lot of potential typo traffic!
Now here’s the thing. According to Internet registry records, Broadridge only registered its domain on May 17, 2007 (boy, were they ever racing to get ready for July 1.), while the other domain being used for the ad spam site was created on August 22, 2004.
In other words, someone at Broadridge knew, or should have known, that there was a very similar URL already on the Web. And that people make mistakes when they type in URLs from memory or from paper. A 10-year-old could tell you that. There’s an entire industry built around it.
Anyway, that was my first impression with the first e-proxy by a U.S. company. It only gets worse from there… But I’ll save that for another post.