R. Foster Winans, The Wall Street Journal reporter convicted of insider trading, has written a book about the scandal. He did it to pay his legal fees, he says. It turns out that he is a better writer than a crook.
''I had to write this book because no one will ever hire me as a journalist again," Mr. Winans told me in a one-on-one interview. Laws against profiting from crime apparently apply only to violent crime.Mr. Winans faces up to 18 months in prison for his role in the illegal stock trading scheme. He leaked stories he wrote for the newspaper's "Heard on the Street" column to a broker who traded on the advance information and gave him a share of the profits. He collected $30,000, while the broker pocketed $700,000. Mr. Winans stands to make much more than $30,000 on his book.
Mr. Winans is admittedly ashamed of his betrayal of associates and the public trust and his flagrant violation of the ethics of journalism. But in talking with him one suspects that he might relish a bit the spotlight the crime has thrown on him. While awaiting word whether the Supreme Court will hear an appeal of his case, he is embarking on a 12-city, nationwide tour to promote his book, "Trading Secrets - Seduction and Scandal at the Wall Street Journal," which is published by St. Martin's Press.
"I hate going through this again," he complained in the book-lined conference room of his publisher in the Flatiron Building in Manhattan. ''First, I had to go through the trial. Then it all came back to me when I wrote the book. Now I'm living through it a third time."
He's proud of the book. "I had to do a good job," he said looking away from me. "I have to survive and I have legal expenses to pay. Besides," and he looked directly at me, "I had things I wanted to say to certain people and this was the only way I could do it."
Why did he get involved in the stock-trading scheme?
Part of it was the fact that he felt he was grossly underpaid, he said. Also, he suspected that others at the newspaper had taken advantage of the unique information gathering position in which business journalists find themselves. He had heard that a Wall Street Journal editor bought a $400,000 co-op apartment for cash with profits from playing the market. When Peter Brant, an apparently highly successful broker at Kidder Peabody, asked, ''Wouldn't you like to be a millionaire?" the temptation was too great.
To quote from the book, "Peter was precocious and more. He was Gatsby: mysterious, charming, with a powerful charisma he could turn upon you like a brilliant spotlight."
Mr. Brant owned horses and played polo. He had a yacht and a big home on the North Shore of Long Island. Weather permitting, he commuted to and from work by helicopter.
When Mr. Brant sent a limousine to the paper to pick him up after work, Mr. Winans arranged to be met at a nearby hotel instead. "Someone from the paper might spot me, a Journal reporter, earning $575 a week and wearing scuffed-up loafers and a $28 navy-blue blazer from a seconds store, stepping into a limo at the Journal's front door. The only person I knew at the paper entitled to commute in a limo was Warren Phillips, and he was chairman of Dow Jones & Co., which owns the Journal. I was supposed to be writing about the silk-stocking crowd, not emulating it," Mr. Winans wrote.
"I knew I was doing something wrong, something that could get me fired, but I didn't think it was a crime, he said. He stopped talking at this point and took out a small red pocketknife and cut away at a loose strand on his shoe.
Mr. Winans was also frustrated with his job at The Wall St. Journal. Dick Rustin, his immediate supervisor at the newspaper, picked on him relentlessly, he said. "It was kind of a sado-masochistic thing. There wasn't one day I worked at The Wall Street Journal that I didn't think I was going to be fired."
Mr. Rustin, for his part, was so distraught when he learned of the scandal that he called and left a message on Mr. Winans' answering machine: "Foster Winans, this is Dick Rustin. All I've got to say to you is I think you are the
scum of the earth."
Getting caught, Mr. Winans said, nearly drove him to the verge of suicide. He took to popping Valiums in the days that led up to his trial. In "Trading Secrets," he says he felt "overwhelming shame" at what he had done and, while on the witness stand, "I turned in the chair so that I faced away from the courtroom, doubled over, and, for the first time since the whole mess began, exploded in deep, uncontrollable sobs."
Mr. Winans is working on his second book, a novel set on Wall Street. Why did he decide to write a novel instead of a non-fiction book? "It would be awfully hard to do research from a jail cell," he explained. "Besides I have a lot of good tidbits left over from my first book that I can use without having to name names or identify anyone."
The stock market still fascinates him. Asked what caused the big drop in the market on Sept. 10, he shot back, "I couldn't give a rat's ass." But after pausing to reflect, he added, "Actually, I was going to short the market a few days earlier. The rally is over. We're in a recession, only we don't know it yet."