Seeking Alpha removed five articles from its web site Sunday, all of which included an identical paragraph about Galena and its experimental breast cancer vaccine Neuvax. The articles, published over the past two months, appeared to have been written by three different people all under the cloak of anonymity using the aliases Elegant Trader, Momentum Trading and Thomas Option Hunter.
After looking into the matter, Seeking Alpha discovered that a single individual wrote all five articles.
"We investigated this situation and have identified an individual who is responsible for these articles. As this person has operated contrary to our editorial and ethical principles, we have shut down their access to the site," said Seeking Alpha Managing Editor George Moriarty, in an email response to questions regarding the articles. [Disclosure: Moriarty is a former managing editor at TheStreet, where he supervised my work.]Seeking Alpha allows contributors to publish investment articles under pseudonyms -- a practice the web site says is necessary because some of its most talented contributors work for companies or firms which forbid employees from being quoted in the media or publish under their own name. Still, anonymously penned investment articles are controversial and risky. By removing a layer of accountability, readers are less able to judge the credibility or motives of the author. Seeking Alpha says it tries to minimize the risks by holding anonymous authors to the same compliance and biographical standards as contributors who write under their own name. Seeking Alpha also insists on knowing the real identity of anonymous authors even as that information is withheld publicly. In this case, Seeking Alpha's safeguards broke down. One article written by Momentum Trading and two each by Elegant Trading and Thomas Option Hunter all touted the prospects of Galena Biopharma. Each of the articles was slightly different except they all included an identical paragraph starting with the sentence: "On Friday, December 7th, Galena presented the results of a Phase II trial for its flagship product, Neuvax. The results were well received by analysts even though the stock fell off a little bit." Three of the articles also promoted Sunshine Biopharma, a penny stock that trades on the OTC bulletin boards. Other articles written by the individual under the Momentum Trading, Elegant Trading and Thomas Option Hunter pseudonyms remain on Seeking Alpha's web site. Stocks promoted in these articles include Arena Pharmaceuticals (ARNA), Threshold Therapeutics (THLD), Celsion (CLSN), Dendreon (DNDN) and Cellceutix (CTIX), another bulletin board-traded stock. "We are next going to review all the articles published under this individual's profiles and determine appropriate next steps," said Seeking Alpha's Moriarty. -- Reported by Adam Feuerstein in Boston. Follow @AdamFeuerstein
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