Adbot

Adbot announced the introduction of its auction market for Internet advertising on Jan 23, 1997. On April 10, 1997, the company held its first live outcry auction, pairing a number of small publishers with interested advertisers. By mid-summer, Adbot was well on its way to selling more than 100 million placements and had completed a closed loop of ad delivery and publisher payments.

Adbot operated under this model until Dec 5, 1997. On that date, the Federal Bureau of Investigation raided Adbot's office resulting in the cessation of normal operations, as part of an investigation into securities fraud related to Frith's Chicago Partnership Board (CPB) operation, the ill-advised source of Adbot's start-up funding. Despite efforts to separate from the troubled CPB and continue operations, the company was ordered to liquidate all assets and was shuttered in December 1997. Frith eventually was found by a jury to be not guilty of securities fraud, but was convicted of two securities law violations (out of 23 charges) for operating his CPB broker-dealership without enough money in its reserve accounts. The conviction was based on a financial shortfall on a single day in 1997.

The case notably became reference case law regarding auditing requirements for securities firms.