CNBC has a reality show called American Greed. I confess I have never watched it but apparently it profiles people who are out to make a quick buck, often at the expense of others and often in illegal ways.
Last night they aired an episode about James Lull, who allegedly ran an investment scam in Hawaii that bilked 50 investors out of millions of dollars. I have no problem with the TV show, but they wrote this article yesterday “Private Lending: High Reward, Higher Risk?” that was essentially a promotion for the show. In this article they also discussed Prosper and p2p lending. You can find a link to this CNBC article on the American Greed website.
Making a Very Dubious Connection
When you read the article it starts off as your standard p2p lending piece about matchmaking borrowers and lenders. There are some quotes from Joseph Toms, the Chief Investment Officer from Prosper.com as well as an official at the Securities and Exchange Commission. But halfway through the article, the focus suddenly switches from p2p lending to the allegedly illegal activity of James Lull. The reporter then switches back to p2p lending, as if the two have similarities.
I found this incredible. To me, this is like doing an article on drug use in baseball and then including a piece about NFL quarterback Peyton Manning (I read somewhere he may have signed with the Broncos :-)). Sure it is all sports but one has very little to do with the other. And the casual reader may be left wondering if Peyton Manning uses performance-enhancing drugs. Of course I am not suggesting that here.
I spoke with Joseph Toms yesterday and he said he was stunned about the implied comparison. He happily agreed to an interview with CNBC – both Prosper and Lending Club do these kinds of interviews all the time – but he had no idea his comments would be used in a promotional piece for American Greed. In fact, as he recalled the depth of conversation he had with the reporter about the steps the company takes to provide full transparency of data, it seemed astonishing to him that an attempt at this connection would be made by such a reputable news organization.
If I was at Prosper I would be hopping mad. Suffice it to say that private lending of hundreds of thousands of dollars for real estate loans has as much in common with Prosper as Jose Canseco has with Peyton Manning.
Peter Renton is the chairman and co-founder of LendIt Fintech, the world’s first and largest digital media and events company focused on fintech. Peter has been writing about fintech since 2010 and he is the author and creator of the Fintech One-on-One Podcast, the first and longest-running fintech interview series. Peter has been interviewed by the Wall Street Journal, Bloomberg, The New York Times, CNBC, CNN, Fortune, NPR, Fox Business News, the Financial Times, and dozens of other publications.