A Hit Netflix Show Puts a Spotlight on a Stockpicking Guru
A Hit Netflix Show Puts a Spotlight on a Stockpicking Guru
(Bloomberg Businessweek) -- The Netflix reboot of Unsolved Mysteries brings back the show’s heady mix of tales of unexplained deaths, disappearances, and the occasional UFO story. The new series, which has been one of the service’s most popular shows since it started streaming on July 1, begins with an episode tied to the world of stock market newsletters.
Rey Rivera, an aspiring screenwriter, was working for a newsletter publisher in Baltimore. One day in May 2006, the then-32-year-old rushed out of his house after receiving a phone call from his office. About a week later his body was discovered in an annex of Baltimore’s Belvedere Hotel, below a hole in its roof. Rivera seemed to have plunged through, perhaps after falling from the building’s adjacent tower. Police at the time said it was probably a suicide, though they say they’ve made no official determination. Rivera’s family doubts he killed himself.
That’s where the show leaves it—it makes no allegations connecting anyone to Rivera’s death. It does spend a lot of time discussing his work with his boss, Porter Stansberry, founder of the newsletter group Stansberry Research. This was enough to pique the interest of internet sleuths on Reddit, and on the Twitter feed of Stansberry Research, people responded to a recent tweet about a gold-mining stock with comments about Rivera. The story also inspired articles from pop-culture-oriented outlets such as GoodHousekeeping.com, which asked who Stansberry is and what kind of business he’s in.
In an emailed statement, an outside spokesman for Stansberry, David Churbuck, called the show “a one-sided exploitation” of Rivera’s death. He said everyone at the firm, especially Stansberry himself, was “heartbroken” and had tried to help find out what happened to Rivera.
Stansberry Research publishes dozens of newsletters, offering tips on everything from trading in retirement accounts to cryptocurrency to cannabis stocks. And it combines that with a dash of populist gloom and doom. A few years ago, Porter Stansberry posted lengthy video commentaries darkly warning of “the end of America.” In a more recent online video, he decries socialism and demands for slavery reparations, saying they’re a symptom of rising income inequality—and telling viewers they can become a part of the fortunate group getting rich if they follow his advice, which the site offers to sell for an introductory one-year subscription of $49.
The company says it has hundreds of thousands of subscribers who pay to hear his newsletters’ investment ideas. “The ideological underpinning of newsletters has always been populist and anti-Wall Street,” says Mark Hulbert, who’s tracked the industry for more than four decades with Hulbert Financial Digest Inc. “Stansberry has always been very good at tapping into that sentiment.”
In 2003 the Securities and Exchange Commission sued Stansberry and a newsletter he edited, Pirate Investor, for disseminating false information tied to a Maryland energy company. Stansberry emailed his readers: “DOUBLE YOUR MONEY ON MAY 22ND ON THIS SUPER INSIDER TIP.” He would reveal which company only if his subscribers paid $1,000, and he had plenty of takers. That tip netted more than $1 million in sales, but the SEC said it was bogus. After a multiyear legal battle, Stansberry and Pirate were ordered by a U.S. District Court to pay $1.8 million in disgorged profits and penalties. He’s argued that the SEC infringed on his First Amendment right to publish financial commentary; the New York Times agreed with him in a 2010 editorial titled “The Right to Be Wrong.”
Stansberry has had another regulatory run-in as well. In 2011 the company paid a $55,000 penalty to the Social Security Administration for claiming to have “insiders” at the agency and agreed to cease promoting his Get Social Security No Matter What Your Age publication. The company didn’t admit wrongdoing. Stansberry was also called out in 2013 by the liberal group Media Matters for America for using racist and homophobic slurs on his online radio show. He told listeners that it’s “bulls---” if he’s criticized for using such terms when he’s “not the least bit bigoted.” In an emailed statement, Brett Aitken, publisher at Stansberry Research, said “the words [Stansberry] chose, and the way he tried to articulate his message, obscured the point he was trying to make,” that words need to be judged in context. Aitken said there’s no place for racism or homophobia at the company.
Stansberry has worked on building a bigger media footprint in recent years. Stansberry Research publishes a free online political magazine called American Consequences, which advertises the company’s newsletters. His podcasts have drawn big right-wing names such as Glenn Beck and Alex Jones, as well as more mainstream financial commentators and journalists. Whitney Tilson, the high-profile former hedge fund manager, teamed up with Stansberry to write his own paid newsletter. “I did so because he’s built a very impressive business,” Tilson said in an email.
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