Monday, September 1, 2008

SEC Subpoena

In February 2006, Greenberg and other journalists were served subpoenas from the Securities and Exchange Commission (SEC) demanding records of phone and e-mail communications with sources for an investigation of which the journalists were not the target. In a rare public reprimand, SEC chairman Christopher Cox said that he was not consulted prior to the issuance of the subpoenas by the SEC's San Francisco office, and that the "subpoena to a journalist which seeks to compel production of his or her notes and records of conversations with sources is highly unusual."

The subpoenas were harshly criticized by the media and by First Amendment groups. In an editorial, The Wall Street Journal said that "SEC scolds are harassing journalists who report market-moving facts based on their daily digging." The newspaper said "the journalists are suspected of having sources who tell them things that they then share with their readers or listeners. Where we come from this is called reporting, or providing facts to investors who can then make more informed decisions."[9] Shortly after the subpoenas were disclosed, the SEC reversed course and said it would not enforce them. The investigation concerned a research firm called Gradient Analytics, which was subsequently dropped.

Posted by Mahyar Hashemi, at 2:50 PM