In November 2016 in France, Vinci S.A. fell victim to fake news which caused the share price to tumble by 18%. This so called Vindi incident clearly demonstrates the importance of using professional financial communication platforms.
But first, let’s recap the events of 22nd November:
- 4:05pm: A press release which seemed to come from Vinci was sent by email to the media. The release contained information regarding accounting malpractices and the resignation of the CFO. A fake website was also created to increase the credibility of the fake announcement
- A few minutes later, the release was disseminated by press agencies to the market and the Vinci share price fell by 18%.
- 4:10pm: A Vinci spokesperson stated that the information had not been published by Vinci.
- 4:49pm: A written statement was posted on the real Vinci corporate website.
- 5:02pm: The statement was disseminated on the regulatory news circuits (Bloomberg, Reuters, AFP, AMF, Yahoo, etc.)
- A post-mortem press release was published the next day
Press release on Vinci website dementing the previous fake release
What was wrong with Vinci's reaction? It took too long for the market to be updated. And time is money.
So, let's put together some guidelines on how to fight fake news faster:
1. Disseminate on Professional Terminals
Vinci's reaction was a statement on their website. But uploading the press release on the corporate website is no longer sufficient. An issuer must send its regulatory news via secure feeds to professional financial terminals, such as Reuters, Bloomberg, Dow Jones, Factset, AFP. This is the fastest way to reach investors, analysts and the media. To ensure the authenticity of the press release it contains specific tags, such as ISIN, Ticker code, “Regulatory News” disclaimer, corporate profile etc.
2. Simultaneous and Real-Time Dissemination
Vinci didn't use the whole range of communication channels. It's important that stakeholders are informed at the same time and in real-time. Thus, there needs to be synchronized distribution to regulatory circuits, contacts, online media, the corporate website and social media. The management of information is then optimized as the targeted audience receives the release from multiple sources.
3. Broader Online Distribution
Vinci lost control of the online distribution of its news. Using wire distribution has the additional advantage of publishing press releases in HTML format on major online newsfeeds. By increasing its digital presence, a listed company increases the exposure of its press releases on algorithms: from Google Search to quantitative analysis, but also investments based on “sentiment analysis”.
This Vinci incident shows us the impact of the digital revolution on financial markets. It's therefore important that companies manage their digital financial communication professionally. Using a self-service, multi-channel platform is now essential as it allows companies to manage communication workflows from start to finish and without delay. All this can only be done via the secure platform of a Certified Primary Information Provider (PIP).