But don't expect reporters to thank Carey. In old media circles, Sharesleuth is considered just as compromised as the companies it covers. The beef: Sharesleuth is funded by Mark Cuban, the infamous Broadcast.com founder and Dallas Mavericks owner. Cuban finances the site by shorting the stocks of the companies Carey investigates in his stories. And Cuban trades before Carey publishes. (Short sellers are betting a stock will fall; they borrow the stock from a broker and sell it, with the promise to buy the stock later — hopefully, at a lower price — and return it to the broker.) Carey and Cuban disclose the financing technique on the site, but that hasn't stemmed the criticism. On his blog, The New York Times' Andrew Ross Sorkin dubbed the strategy "about as basic an ethical violation as there can be, whether that stake is disclosed or not." Blogger Gary Weiss, a former BusinessWeek reporter, accuses Cuban of "soiling investigative journalism to line his pockets." Fred Brown, vice chair of the ethics committee of the Society of Professional Journalists, a trade group, warns that "Mr. Cuban is eating the fruit of the poison tree."
Cuban has never been known to duck a fight, and you can almost hear the glee in his email as he responds to these charges. He says that business journalists are either blind or naive to the role they play in boosting the stocks of the companies they cover, which employ legions of public relations staffers to influence media coverage. "You just leave all the gain to the interviewee using you to move the price of a stock in a profitable direction for them," he writes. "You pay for the newsprint and postage by selling ads for products that you know nothing about and hope they work. How is that working out for your industry these days?"
