The shooting death of a Kuwaiti businessman this past weekend is a sobering reminder of how wrong things can go when misinformation is used to pump up stock prices.

Whether Hazem Khalid Al-Braikan killed himself or was murdered isn’t the point.  What is clear, no matter how the CEO of Al Raya investments died, is that the U.S. Securities and Exchange Commission had frozen his assets because of suspicious and potentially profitable trading that occurred just before the release of news on a bogus tender offer.  (Read the full account here)

The credibility of time-sensitive, market-moving corporate news is central to the smooth operation of our global equities markets.

There’s a place for humor, such the ongoing spoof between Apple and Google on the BBspot blooper site and other venues clearly marked as parody.  But the biggest trusted providers of financial information — Dow Jones, Reuters and Bloomberg — are fighting an increasingly difficult battle to screen out bogus data from legitimate news on their closely watched platforms.

Hats off to astute newsroom staffers who rejected the fake release concerning Harmon International and Textron this past weekend, having questioned why those  NYSE -listed companies would not have issued their statements over PR Newswire or Business Wire.  Phone calls and faxed releases from Kuwait were deemed suspicious.

BW’s Neil Hershberg, a former colleague of mine at PR Newswire, noted today that we are approaching the one-year anniversary of an odd SEC statement that gave corporations the green light to experiment a bit more in the way they disclose their material news to investors.  During the past 12 months, the vast majority of companies have continued to broadcast their full-text news to the media, investors, employees, customers and other audiences via the security-obsessed commercial newswire services — ranging from industry stalwarts Business Wire and PR Newswire to Nasdaq’s Globe Newswire and the upstart Marketwire — rather than risk raising questions about the authenticity of their information.

Certainly, some innovation has taken place: 

• Ebay supplemented its use of BW with Twitter to snap highlights during the company’s quarterly conference calls
• Nasdaq-listed BGC Partners, Inc. issued a short statement over PRN saying its earnings release had just been posted to its website.  The downside of “notice-and-access “release is that investors have to take an additional step to download the company’s data, and opening additional browsers is potentially slow and cumbersome

As the C suite and investor relations officers strive to stand out from the crowd — especially when the economy begins to grow again — there will be new models and exciting ways to share information.  High atop any list of possible disclosure solutions should be the question, “Will investors trust that this information is legitimate?”