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Why Tom Petters read Twin Cities Business’ story on him before you did

Why a Ponzi schemer got to “pre-review” his jailhouse interview.

Tom Petters
Photo by Bill KelleyTom Petters

“Can I see the story before it runs?”

Almost every print journalist has had a source ask them this, and the answer — for those not in the puffery end journalism — is a reflexive “no.” Publications might check facts and confirm quotes, but sharing headlines, other sources’ quotes and analysis typically isn’t done.

So why did Twin Cities Business allow a convicted Ponzi schemer to have “pre-publication review”?

TCB editor Dale Kurschner scored the first jailhouse interview with epic scamster Tom Petters, a “get” that garnered enough attention for a Star Tribune cap-tip and at least two interviews on WCCO Radio.

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On WCCO, host John Hines asked Kurschner if Petters got to read the 14-page story before it ran. Kurschner replied: “I did send him a copy for factual purposes ahead of time, but we had an agreement in writing before we even did anything that he would not have final say over what the story says. He could tell us if there was an inaccuracy, but it was totally our call on how that story ran.”

That quote prompted Fox9 investigative reporter Tom Lyden to tweet: “TCB Editor of Petters article says they sent copy to Petters before publication. Wha??? That’s not a fact check.”

Lyden added: “Even had contract with Petters. Was it disclosed in article? Snds fishy.”

Getting a sensitive source to cooperate is often a matter of flattery, diplomacy and pressure; the challenge is not to sell out in pursuit of the story. Although Kurschner wrote a full-page editor’s note detailing the six-month saga of securing Petters’ cooperation, he did not disclose to readers the unusual provision that might have been the deal-clincher.

‘Unusual step’

As Kurschner explained to me, “An extra and unusual step in the fact-checking process ­— necessitated by the extraordinary complexities of this story and difficulties communicating into prison — did not in any way affect how the story was written and presented to our readers.”

He adds, “Normally, we don’t do” pre-publication review, “but part of the issue was logistics. It’s impossible to call and talk about a 14-page story” over a jailhouse phone. “He’s charged so much for calls and has no money. He can’t just get on the phone and email people.”

The other issue, Kurschner says, was Petters’ plans to appeal his conviction, for which he is serving 50 years with no chance of parole. Petters’ “hypersensitive” lawyers advised him not to do the story; pre-review was necessary to clinch the deal.

“With this particular situation, letting him take a look ahead of time, given the complexity and sensitivity of the appeal, was a warranted exception,” Kurschner says. “Part of it is going into situations where people aren’t willing to talk to you and earn their trust. Having him take a look at the story was part of earning that trust.”

Of course, keeping trust with readers is one reason editor’s notes should disclose unusual arrangements even if the editor doesn’t believe he was compromised. Though Kurschner retained the final say, by showing such deference to Petters’ legal needs, TCB risked turning itself into an agent of the appeal, even if the editor trusts his own backbone in presenting the story headlined “Plausible Deniability?”

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Kurschner — who says he spent “dozens” of hours researching the case, including reading the trial transcripts twice and listening to all the evidentiary recordings of Petters — did interview prosecutors and included their blunt appraisals of Petters’ guilt. The editor says the story didn’t change much after Petters saw it: “A few things, little factual things.”

Still, it’s hard to imagine the Petters’ side being too displeased with Twin Cities Business’ coverage, which resurrects a question most think closed, recounting the ex-CEO’s lengthy, detailed argument that underlings orchestrated the scam and duped him. 

Reading the piece — which includes suggestions Petters didn’t get a fair shake in the media — I felt compelled to ask Kurschner if he believed the ex-CEO was guilty. “I think he’s guilty,” the editor replied. “I don’t know personally for sure 100 percent whether he started a Ponzi scheme or not, but he’s guilty of participating, knowing and being CEO of all of this when it happened.”

No review

Meanwhile, other local publications say they can’t dangle the “pre-publication” carrot. At the Minneapolis St. Paul Business Journal, editor Dirk DeYoung says company policy forbids it. “Questions of accuracy can be addressed via good reporting, reading quotes back to sources, clarifying facts with sources and double-checking facts with other sources,” he says.

DeYoung offered these bullet points:

  • Precedence: Allow it for one source, everyone will want it.
  • Independence: Reporters and editors need to be able to write a fair, balanced and complete story that’s in the best interest of the readers without having angles, conclusions, leads, headlines and statements from other sources second-guessed or nit-picked.
  • Speed: Such a process would slow down getting news out to readers as quickly as possible.
  • Other sources: If a source reading a yet-to-be-published story doesn’t like what other sources say, that could get messy in countless ways prior to publication, including having the secondary sources pressured to recant, etc.
  • Advertisers: What if the source in question is an advertiser? That could go wrong in multiple ways, and also is not in the best interest of the reader.

Jeff Johnson, who edited Minnesota Monthly magazine for eight years, says he “never” sent the article to the source. “Aside from the fact that it’s not done, it’s journalistic tradition and practice to separate the writing of the story from the source of the story. Frankly, if you have a beef with that after the fact, you have recourse,” such as letters to the editor and op-eds.