Hunterbrook Launches the "Hedge Fund That’s Also a Newspaper"

A Hedge Fund That’s Also a Newspaper

One way to think of this business model is that Hunterbrook is essentially an activist short-selling hedge fund, like Hindenburg Research: It investigates companies, finds problems, shorts the companies, and then noisily publishes its investigation to draw attention to the problems. But whereas Hindenburg is straightforwardly a short-selling firm, Hunterbrook’s news site is at least theoretically independent of its hedge fund, and if it publishes enough good general news then perhaps it can become more widely read and trusted — and have more stock-price impact — than a pure hedge fund.

Another way to think of this business model is that it is a salary arbitrage. It is expensive to hire hedge fund analysts to investigate companies all over the world. It is cheaper to hire journalists! You might find more tradable signals with 20 journalists than you can with one hedge-fund analyst.

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Short selling is not, however, the only business model for investigative-journalism-that-is-also-a-hedge-fund, and Hunterbrook is looking at others.

SEC Bribery Unit Probes Technology Companies’ Use of Contractors

The US Securities and Exchange Commission is asking publicly traded tech companies about their relationships with distributors and other business partners outside the US in a push to root out possible corruption, according to people familiar with the matter.

The SEC started sending letters to the firms earlier this year under its mandate to enforce the Foreign Corrupt Practices Act, which makes it a crime to offer anything of value to non-US officials in an effort to win business.

The agency’s FCPA unit is asking whether the companies did business with a list of dozens of intermediaries — some of which have been implicated in other investigations — across various regions, including Asia, Latin America and Africa, said one of the people. All of the people familiar asked not to be named discussing a confidential matter.

The SEC’s Shot Across the Bow on ‘AI Washing’

The SEC is right to be aggressive. As of Jan. 18, there were 353,928 .ai domain names registered. How many of those 353,928 domains belong to a company that actually uses AI?

Admittedly, AI is a broad category. IBM, for example, defines AI as “technology that enables computers and machines to simulate human intelligence and problem-solving capabilities.” When, as one commentator has asked, “does something go from being a Fax machine to being Samantha from Her or HAL from 2001: A Space Odyssey? Where do we draw the line?”

The SEC will aim to avoid such esoterica by targeting lies that it can prove in court….

Autodesk Falls After Disclosing Internal Probe Into Accounting

Autodesk Inc. fell by the most in almost a month after disclosing an internal investigation into its own accounting practices and putting off the release of its annual financial report.

The San Francisco-based software maker received information that has prompted “an internal investigation with the assistance of outside counsel and advisors,” Autodesk said in a filing late Monday. The probe involves accounting practices around free cash flow and non-GAAP operating margin practices, the company said, while noting it doesn’t believe the review will affect previously issued financial statements.

Sam Bankman-Fried prosecutor says coder’s cooperation sped up case

U.S. prosecutors were able to charge FTX founder Sam Bankman-Fried shortly after the cryptocurrency exchange’s collapse in part because they secured the cooperation of its chief software engineer, one of the prosecutors said on Tuesday.

Speaking five days after Bankman-Fried was sentenced to 25 years in prison, Assistant U.S. Attorney Thane Rehn said former FTX Chief Technology Officer Gary Wang’s assistance was key to helping investigators understand how Bankman-Fried stole $8 billion in customer funds.

“Without that, would we have found it? Probably,” Rehn said at a discussion hosted by law firm Wilson Sonsini. “But it would have taken a software expert weeks or even months.”

S&P 2023 Report: Women Lose Senior Roles To Men In US Companies

Women accounted for 11.8% of the approximately 15,000 C-suite roles in the S&P Global Total Market Index in 2023, researchers at the data provider said, down from 12.2% the previous year. That suggests women ceded about 55-60 positions with ‘chief’ in the title to men last year.

Though the absolute decline may seem small, it’s significant considering women’s representation in top roles had been increasing for years, from 6.5% in 2005. Across a broader swath of senior positions, numbers nearly tripled in that time period to 22.3% in 2023.

At the SEC: Nothing but Crickets — Remarks at SEC Speaks

Productive interactions with the SEC are fewer and further between than they were in the past. When individuals and entities come to the SEC with their novel ideas, their feedback, their concerns, their objections, their questions about implementation of a new rule or application of an old one to new circumstances, too often now they are met with . . . well, crickets. Neither staff expertise nor issues ripe for analysis are lacking, so what has changed? In part, the staff, run ragged by a punishing rulewriting agenda, does not have the bandwidth to think about hard, novel legal questions. The remote work norm also may play a role as it reduces opportunities for spontaneous staff collaboration to work through tough questions. The root of the problem, though, is that the Commission discourages the staff from offering much more than silence, shrugs, sighs, and slow-walking. The culture at the top of the SEC has changed, which in turn has changed the way the agency interacts with the public.

Countless people have told me that they used to feel comfortable coming in and speaking with the Commission and its staff, but no more. When it comes to interpretive guidance, “the Commission is closed for business.” New product ideas? “Not now.” Approval to do things for which other firms already have approval? “That permission was very limited.” Feedback on how to a particular set of facts interacts with a new rule? “We cannot provide legal advice.”