Wall Street analysts, accused of publicly hawking companies they were privately trashing, would have to include a statement in their research reports certifying the accuracy of their views under a rule proposed Wednesday by federal regulators.
The Securities and Exchange Commission, claiming the proposal would boost investor confidence in what analysts are saying, voted unanimously to send the measure out for 30 days for public comment.
Know as Regulation AC, for Analyst Certification, it could be on the books by the end of the year.
A spokesman for the Securities Industry Assn., which represents the interests of more than 600 brokerage firms, said, "We support the fact that the SEC is addressing this issue, but we want to look at the details."
The reputations of research analysts have taken a beating after an investigation by New York State Atty. Gen. Eliot Spitzer uncovered e-mails between Merrill Lynch & Co. analysts in which they slammed Internet stocks as "junk" while publicly backing them.