<i>IN’s</i> Pavia: Advisers, don’t kill the media messenger

A financial adviser suggested that one of his satisfied clients buy a high-quality mutual fund.
The client did just that, the trade settled without a hitch and everyone was happy.
Such an experience and thousands like them certainly represent one part of an adviser’s reality. But if InvestmentNews published such stories week after week our readers would cancel their subscriptions.
The business of financial advice is fast-changing and complex, and developments of particular interest and importance to advisers often don’t reflect well on some of the people involved.
Our job is to report fairly and accurately all the important news in this business, even if some of what we report isn’t particularly flattering.
I bring up this issue because several readers have recently called us out for writing “negative news.” Let me assure you that: a) our reporters and editors don’t have a hidden agenda; b) no one is out to get anybody; c) we strive to be fair and include all sides of a story; and d) we don’t make anything up.
The job of advisers and the role of financial firms and their regulators are so important that it is news when an individual, company or organization breaches the public’s trust. And InvestmentNews will be there to report it regardless of whether the news irks an adviser, a powerful regulator or an advertiser.
Sometimes, just quoting the public record makes our readers irate.
Recently, a broker whose securities license had been terminated by the Financial Industry Regulatory Authority Inc. and who found himself in even more hot water for his actions called me to complain about our “negative news coverage” concerning him.
“Isn’t there a bigger story to cover? When are you going to stop writing about me?” he asked.
I said: “When you stop doing bad things.”
A few days later I received the following e-mail from a reader (who isn’t affiliated with Berthel Fisher & Co. Financial Services): “Berthel Fisher won an arbitration case in regard to [sales of DBSI tenant-in-common exchanges]. Not all B-Ds are crooks and not all reps are liars and thieves. It would show good faith if you covered something like this. The Leading News Source for Financial Advisers sure paints a lousy picture of the industry on a consistent basis.”
Ironically, reporter Bruce Kelly did cover the arbitration result and did show “good faith,” though we just call it fair reporting. I guess the reader was so eager to find fault that he failed to see the story which appeared on our website a few days earlier.
What such angry readers should know is that I receive a great deal of positive feedback from readers who say that they appreciate the fact that we tell it like it is. These readers say that they have come to rely on us for our honest and accurate news coverage.
Be that as it may, it appears to be a time-honored tradition — and human nature — to blame the messenger when bad news is delivered. Because we are the most well-read messenger in our business, InvestmentNews is often blamed for pointing out bad things done by bad guys in the financial services industry.
So let me offer some advice to those who want to avoid the “bad news” treatment.
First, make sure your firm and its principals play by the rules and avoid any wrongful activity. Second, don’t shut us out when bad things happen.
Some people think that if they say “no comment” and clam up, we will go away. We won’t.
If they truly are innocent or misunderstood, they should tell us their side of the story. We will include it in our coverage.
And if you think that bad news coverage should be muzzled, consider where that has taken place.
In societies where kings and queens, czars and commissars, despots and dictators simply didn’t, or don’t, allow bad news to be disseminated, no one could, or can, actually believe any news.
Societies like that, with lots of positive news, have economies that don’t support too many advisers.
I admit that the process by which we work isn’t flawless. However, don’t blame the messenger if things don’t work out the way you wanted.
Jim Pavia is the editor of InvestmentNews.

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