Putting Investors FIRST 

Global ‘Standards Of Practice For Research Providers’
Unveiled At National Investment Banking Association
Meeting By FIRST Research Consortium;
Reform Includes Ban On Stock Ownership

Denver -- (BusinessWire) May 18, 2006 – Comprehensive new global “Standards of Practice for Research Providers” were introduced and promulgated today by the FIRST Research Consortium (http://firstresearchconsortium.com), a three-year old association that previously promulgated the “Standards for Independent Research Providers,” during a keynote luncheon speech at the meeting here of the National Investment Banking Association (http://www.nibanet.org).

The speaker, James A. (Drew) Connolly III, Director of Corporate Development for FIRST Research Consortium member Investrend Research (http://www.investrendresearch.com), said the biggest reform, and perhaps the most resisted in the financial community, is the outright ban on adopters of the new “Standards” to accept, own or trade equities of companies research providers or analysts cover, in a move to further eliminate conflict and provide transparency.

The single exception is for regulatory-compliant broker-dealers with an in-house or contracted research department.

Other speakers at the Denver event included Michael Mayhew, Founder. CEO of Integrity Research (http://www.integrity-research.com), and a Director of Investorside, and Dirk Koerber, Chair of the newly-founded not-for-profit Shareholders Research Alliance (http://www.shareholdersresearch.com), an independent organization that monitors research providers’ procedures and analytics output. Brian Tang, CEO of Fundamental Research Corp. (http://www.fundamentalresearchcorp.com) is Chair of the FIRST Research Consortium.

The ban on stock ownership carries more weight now, in part due to the recent final report of the U.S. Securities and Exchange Commission Advisory Committee on Smaller Public Companies (http://www.sec.gov), on which Connolly served, that has now aggressively endorsed, for example, sponsored research, but only if the research providers follow a disclosed set of standards and provide full transparency, language that had been advocated by the FIRST Research Consortium in SEC testimony.

The new Standards cover adopting institutional, subscriber-based and sponsored research providers and analysts. Other provisions, some developed and adopted in response to the recent highly publicized “independent research” scandal associated with alleged ethical violations by a Phoenix-based analytics firm that has also involved SEC Chair Christopher Cox and related subpoenas to journalists, include greater emphasis on the identification of the credentials and qualifications of analysts, fuller disclosures, an emphasis on further shielding of analysts from outside influences, monitoring and peer review.

The new “Standards of Practice for Research Providers” also prohibit any research provider or closely-related entity, with the possible applicable exception of regulatory compliant broker-dealers, from providing promotional, investor relations, consulting or funding to covered companies, to avoid compromising the integrity of research “or bring disrepute” to the industry.

Spokespersons for the organization said it intends to launch an investor-awareness program to educate the public about problems associated with “look-like” research reports from non-adopting providers, including so-called “reports” distributed by junkfaxes and spam emails.

Connolly called upon the NIBA members and other ethical financial community organizations to join in the effort.

Contact: FIRST Research Consortium (718-896-5060), Gayle Essary, e-mail: Website: http://firstresearchconsortium.com