Journalists who buy shares to gain insight into a company or to write a story should keep ethical considerations in mind. As long as the purchase is above board and transparent, and the amount purchased is minimal — one or two shares — it poses no problems.

But any subterfuge can be problematic. Wall Street Journal reporter Dennis Berman pretended to be his late grandmother in an attempt to buy shares in social net-working website Facebook through SharesPost, a market for trading in nonpublic technology companies. Berman’s goal was to test whether the system would detect his at-tempt to dodge the rules.

Berman defended his actions, saying that “applying a simple test to an entire way of doing business helped shed light on an important topic for investors and markets...”

However, he was severely criticized by rival reporters, including Reuters blogger Felix Salmon, for misrepresenting himself. Salmon called it “a cheap stunt,” and questioned Berman’s ethics. (See Chapter 7 for more on ethics for business reporters.)