Social Media

Twitter takeover hoax: How did it happen?

Fake report spikes price

The hoax which saw Twitter's shares spike on Tuesday might have looked convincing to some, but web experts told CNBC that such a ploy is actually fairly simple to pull off.

Shares in the social media company jumped after a (fake) story suggesting that Twitter had received a $31 billion takeover bid was published on a (fake) Bloomberg website -- rather than

A Bloomberg spokesperson quickly moved to confirm the story was fake on Tuesday, and was not affiliated with the financial news company's site.

But Fintan Lambe, managing director of Popcorn Web Design Limited, explained that a hoax like this was actually "very simple." It requires only a small amount of website-design knowledge because the source code – the coding behind a website – is openly available.

"If you can see a website, you can steal it," Lambe told CNBC by phone. "All they would have had to do is open the Bloomberg website and cut and paste the code," thereby creating a replica website, he added.

Hidden location

In order to make the fake site look legitimate, the personal behind the hoax included links back to the genuine Bloomberg website. There were a number of spelling mistakes in the article, however, and it was written in a different way to Bloomberg's regular style.

The fake domain was registered in Panama to WhoIsGuard, a proxy service which makes it difficult to track the location of the actual website creator.

The Twitter banner hangs at the NYSE.
Adam Jeffery | CNBC

"It gives the Internet the impression you are coming from a different location so if someone is trying to track you, you are harder to find," BenSelby, account manager at website design firm JBi Digital, told CNBC by phone.

Hoaxes 'easier' to do

The Twitter saga is not the first market-moving hoax. Earlier this year, a firm calling itself PTG Capital filed an offer with the Securities and Exchange Commission to buy Avon. This sent shares in Avon higher, but it soon became clear that no such company existed.

Last year, British security company G4S was also a target. Journalists received a hoax press release claiming that there were accounting irregularities at G4S and linked to a site that replicated the company's homepage, but had a different URL.

The group behind this hoax even released a guide called "Prank the pranksters! Playing around with information and fakes in the age of immaterial capitalism" -- a how-to document about tricking the media into reporting fake stories.

Cyber experts warned that we are likely to see many more of these kinds of hoaxes as we rely on mediums like social media for quick information.

"This is a reflection of the fact we are becoming more cyber dependent," David Emm, senior security researcher at Kaspersky Lab, told CNBC by phone. "Spreading false information has become easier to do in this day of mass instant news."