MarketWatch.com's Calandra Resigns Amid SEC Trading Probe

Updated from 4:03 p.m. EST

MarketWatch.com(MKTW Quote) said the Securities and Exchange Commission is investigating the trading activities of Thom Calandra, the Web site's controversial senior columnist and one of its founding editors. Calandra resigned his post Thursday after refusing to turn over private documents the company sought from him.

San Francisco-based MarketWatch.com said it began its own probe into Calandra's trading activities one day after learning of the SEC investigation in December. As a columnist, Calandra -- who won a devoted following with prescient calls on gold and other commodities -- was allowed to own stocks he covered as long as he disclosed his holdings to readers.

Calandra's lawyer, Dana Welch, said her client is cooperating fully with the SEC but that he declined to provide MarketWatch.com with certain "private documents." Welch said the SEC inquiry didn't name any specific trades and said Calandra was resigning because of "stress."

The company indicated it was trying to sort out whether Calandra abided by its rules

"While we have made a very clear distinction that Thom provides commentary and opinion in his newsletter and does not report business news, Thom was required to abide by our internal trading policies and fully disclose his activities to his readers and subscribers," the company said in a statement. "We have a responsibility to our readers and subscribers to cooperate with the SEC in its determination of whether or not Thom violated these policies."

Dan Silmore, a MarketWatch spokesman, said the company determined that the initial SEC inquiry with Calandra in December didn't warrant a public disclosure.

"We immediately consulted outside counsel and started an investigation and recommended Thom retain outside counsel," Silmore said. "Thom told us at the time he had not violated internal policy, and because the SEC's investigation was informal with no allegations of wrongdoing, it was found at that time that there was no cause for such a disclosure."

According to the MarketWatch Web site, company policy prohibits its journalists from buying or selling shares of a company when they know a story about it is going to be published, and for 48 hours after its publication. Beat reporters can't own shares in companies they cover.