When Spotlights Fade: Local Newspaper Closures and Financial Advisor Misconduct

Zhi Li; Qiyuan Peng; Rui-Zhong Zhang

doi:10.1017/s0022109025101749

Journal of Financial and Quantitative Analysis Vol. 61 No. 1 2026

When Spotlights Fade: Local Newspaper Closures and Financial Advisor Misconduct

Zhi Li ¹; Qiyuan Peng²; Rui-Zhong Zhang³

¹ Chapman University Argyros College of Business and Economics · ² University of Dayton School of Business Administration · ³ Kent State University Ambassador Crawford College of Business and Entrepreneurship

Abstract

Using individual records of about 950,000 financial advisors, we find that the probability and intensity of financial advisor misconduct significantly increase after local newspaper closures. The impact is more pronounced in counties with a higher proportion of seniors, minorities, and individuals with lower education levels. Male advisors are more likely to commit misconduct following newspaper closures than female advisors. The sensitivity of advisors’ job turnover to misconduct decreases after closures, suggesting a lower cost of committing misconduct. Our evidence indicates that local newspapers play a distinct role in mitigating financial advisor misconduct, as media exposure raises the costs of misbehavior.

DOI: 10.1017/s0022109025101749
Volume: 61
Issue: 1
Pages: 480-510
Language: en
Sources: openalex crossref

When Spotlights Fade: Local Newspaper Closures and Financial Advisor Misconduct

Abstract

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