OLD Media Moves

Sources for Marcial's Wall Street column often have conflicts

August 11, 2008

Dean Starkman of Columbia Journalism Review checked the sources used in Gene Marcial‘s “Inside Wall Street” column in BusinessWeek and found numerous cases where the analysts or investment bankers held positions in the stock or were seeking a business relationship with the company, contrary to the disclaimer that runs with the column.

Gene MarcialStarkman writes, “An Audit check of the past year’s Marcial articles found more than a dozen instances in which sources whom BusinessWeek says are conflict-free actually do have financial relationships or say they intend to seek them.

“In a May 26 column on Bidz.com, a Culver City, Calif., online auction company, Marcial cites Elizabeth Pierce of New York’s Roth Capital Partners: ‘She sees the company continuing to deliver strong results.’

“In an interview, Pierce notes that Roth disclosed in a report on May 7, three weeks before the article, that it makes a market (buys and sells shares for third parties) in Bidz shares and ‘expects to receive or intends to seek compensation’ for investment-banking or other services.

“‘It’s in our disclosure,’ she says. ‘Whether he picks up on it or not….’

“Marcial chalks it up to ‘human error.’ ‘I really appreciate your telling me that,’ he says. ‘In most cases it probably skips my mind.'”

Read more here.

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