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When Spotlights Fade: Local Newspaper Closures and Financial Advisor Misconduct

Author

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  • Li, Zhi
  • Peng, Qiyuan
  • Zhang, Rui-Zhong

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.

Suggested Citation

  • Li, Zhi & Peng, Qiyuan & Zhang, Rui-Zhong, 2026. "When Spotlights Fade: Local Newspaper Closures and Financial Advisor Misconduct," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 61(1), pages 480-510, February.
    • Handle: RePEc:cup:jfinqa:v:61:y:2026:i:1:p:480-510_14
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