Covering Bank of America and using the term fraud

Margaret Sullivan, the public editor of the New York Times, writes Monday about the paper’s recent coverage of Bank of America’s earnings and why the story did not use the word “fraud” to describe some of its woes.

Sullivan writes, “Some Times readers wrote to me about it, pointing out that there was more to the story. They hadn’t forgotten what happened, it seemed. Jamison Wilcox, for example, noted in an email that he was “dismayed to see the term ‘legal costs’ given a vague and euphemistic meaning – and repeated in a headline – as a short replacement for the specific identification of monies paid out … as a legal consequence of wrongful conduct by a corporation or bank.”

“I asked the business editor, Dean Murphy, to respond.

“Mr. Murphy told me in an email that the language was appropriate:

In all of our coverage of banking troubles, including those involving Bank of America, we make a concerted effort to be precise in the language we use to describe the various allegations and prosecutions. While we understand the desire of some people to pillory a bank at every opportunity, we are in the business of reporting the facts in a straight and accurate manner. In reporting Bank of America’s quarterly performance, we summarized the issues clearly without engaging in overheated language.

“The language certainly isn’t overheated. In fact, nowhere in this article is there any straightforward mention of what really caused these legal troubles and costs.

“It says only this: ‘At the heart of the additional legal expenses was a $6.3 billion settlement that the bank announced last month to settle a lawsuit arising from troubled mortgage-backed securities it bundled and sold to Fannie Mae and Freddie Mac before the financial crisis.’ (The bank also agreed to buy back $3.2 billion in mortgage securities, bringing the penalties to $9.5 billion.)

“Bundles and troubles and costs, yes. Fraud accusations, not so much.”

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