Most Beatle fans back then knew or at least sensed it was a hoax. Whether the Fab Four originated it, I don't know. But there's no doubt they intentionally planted phony clues in their music and on their album covers, though I don't think it resulted in a substantial boost in their already enormous record sales. Those who were interested enough in the Beatles to care if Paul was dead or not, were going to buy their albums anyway.
It is TRUE that they also did some "backward masking". If you play backwards the part of "Revolution #9" where it keeps repeating "number 9, number 9, number 9"---you'll clearly hear a voice saying "Turn me on, dead man". Several friends and myself all heard it plain as day.
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