Seeking Alpha takes steps to prevent paid stock promotion

Eli Hoffmann, the senior vice president of content and editor in chief at SeekingAlpha.com, writes about how the financial site is taking additional steps to prevent writers from posting content about stocks they were paid to promote.

Hoffmann writes, “We are grateful to Richard Pearson for his outstanding undercover work in unearthing foul play on Seeking Alpha and other investing websites, and for sharing his research with us proactively so that we could deal promptly with non-compliant authors. You can read Richard’s recent articles on this topic here and here.

“This discovery has led us to re-examine our contributor due-diligence policies, and to implement the following safeguards:

1. Ticker monitoring and blacklisting: We now monitor a number of websites that keep running tabs on stocks that are being actively promoted. When we receive an article on a stock that is suspected of promotion, the article must be reviewed and approved by a managing editor. We have also blacklisted certain stocks from publication altogether in order not to fall prey to promotion.
2. IP tracking: We recently deployed IP tracking in our content management system. We are now able to cross-check article submissions against each other, which has helped us uncover a number of contributors submitting under false identities.
3. ID verification: In cooperation with IDology, we are deploying a system to validate contributors’ identities by matching our information against publicly available databases. In cases where we’re unable to validate a contributor’s identity, we require them to submit official photo ID which IDology can independently validate.
4. Zero-tolerance policy: Any contributor found to have cooperated with stock promoters will have his contributor status permanently revoked, no exceptions.”

Read more here.