Stories in the Los Angeles Times, New York Times and Editor & Publisher this morning all seem to be missing the boat in the continuing story of the SEC’s action to subpoena business journalists. All three stories are focusing this morning on the fact that the regulatory agency whose business it is to protect investors and regulate public companies still thinks it can subpoena business reporters and have them hand over their notes and other pieces of information used in the information gathering process.
Business journalism is a different animal than government and crime reporting, where subpoenas are more frequent — and also contested. But it’s also very similar. We’re dealing with a situation here in which people share information with journalists because they believe it’s important for the market to know and the journalists can help disseminate that information.
The LA paper wrote that SEC commissioner Christopher Cox “said he would prefer that the SEC exhaust other avenues before turning to the news media, which has a 1st Amendment right to gather information without government interference. He said he supported the ‘least intrusive’ means of dealing with the press in SEC investigations and also wanted to ensure that any information demanded of reporters would be ‘of objective importance’ in an investigation.” As a business journalist, that doesn’t give me any warm fuzzies inside.
Editor & Publisher reported that, “The new policy will lay out the circumstances under which it is appropriate for journalists to be subpoenaed in SEC investigations when other means of getting the information are exhausted, Cox told reporters. It will not require agency attorneys to get approval for individual subpoenas from the commissioners but will call for consultation.
“‘This would not be Soviet Red Army rules,’ he said.” No, but it would have a chilling effect on a business reporter’s ability to root out corruption in the markets if sources might be exposed. The analogy by the SEC commissioner conjures up images of something just slightly less than water torture.
The New York Times noted that Cox “also expressed strong support for the work of financial journalists, saying they had a ‘similar mission’ to that of the commission.
“‘The S.E.C. takes very seriously the role of financial journalists and we will do everything we can to work in a collaborative manner because we share a public trust,’ he said. ‘Our sensitivity to these First Amendment issues and journalistic responsibilities in no way requires us to back off from aggressive securities law enforcement.'”
This is the only statement from the Thursday cluster call that makes me feel somewhat good about what I do and how the federal government feels about business journalism. But given his other statements, I’m not sure I’m satisfied.
It may be time for business journalism as an institution to stand up and fight the SEC for what it believes in — the ability to do its job in providing a fair and accurate portrayal of the business world without repercussions.
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After Overstock's conference call Aug 12 , 2005 where the CEO discussed his lawsuit against Gradient and Rocker he said he was done talking about it, that he was handing the baton over to his lawyers. Well not only did he continue talking , Bill Alberts story in Barrons has me thinking he has been busy orchestrating a silence and squeeze enterprise whos only qualification to join is to have been mentioned by Gradient or Greenberg. ....Whats bizarre is a freedom of information request of the SEC for a tally of all investigations that were triggered by Gradient or the press would show the SEC should be making a offer for Gradient , not subpeoning them or the press...
I see few Edward R. Murrow types out there and after 9/11 , even less appetite for one but something should be done. Jim Chano's thoughts that were reported in this weekends WSJ should be front and center..
I'm lucky to have made it out of high school but i can't see how a historian could write much of anything about post 9/11 america without following and understanding whats going on here....
I just stopped by the CNBC squawk box blog . They removed most of my commments about their coverage of this issue. There certainly isn't a Edward R. Murrow in that bunch . ...