Fired Forbes editor got $6 million for Shook Research sale help

Randall Lane, fired as Forbes' top editor in July, received a $6 million payment from RJ Shook for guidance that helped sell Shook Research to PPC Enterprises last year, Shook said Monday.

The payment was made "in recognition of the services and guidance" Lane provided, along with "the success I achieved as a result," Shook said in a statement.

Lane and Shook met in 2011, and Lane helped forge the partnership between Forbes and Shook Research in 2016. Shook Research provides rankings of financial advisers that Forbes uses for its popular "best of" lists. Lane accepted the payment shortly after PPC Enterprises acquired a majority stake in Shook Research last summer but did not disclose it to Forbes, according to The New York Times.

Shook Research is a top Forbes business partner that generates millions of dollars for both companies, according to people familiar with the matter. Morgan Stanley Wealth Management told its advisers last week it suspended its relationship with the Forbes-Shook Research rankings, and Forbes is working with outside counsel on an independent review.

"My actions were taken with the best intentions, but ultimately the payment was a mistake," Shook said. "I deeply regret that this has raised questions about the integrity and independence of Shook's rankings."

The men "maintained a close connection" since they met, Shook said. He said Lane provided professional advice and guidance over the years, helped forge the partnership between Forbes Media and Shook Research in 2016, and later assisted with his efforts to sell the company.

Lane assisted in the Shook Research sales effort by speaking about the relationship between the company and the magazine during the due-diligence stage, according to people familiar with the matter. "Randall was never authorized to speak on behalf of Forbes in connection with this transaction," a Forbes spokeswoman said. "If he engaged in these activities, he never disclosed them to Forbes."

Forbes said Lane's acceptance of the undisclosed payment "was unacceptable and is inconsistent with our policies and principles of trust, transparency, and disclosure." The company is "exploring all appropriate actions to hold Mr. Lane to full account," the spokeswoman said, and so far has not found evidence that the integrity of its rankings or editorial decisions were compromised.

Lane, who worked at Forbes for 15 years and oversaw its "30 Under 30" lists, said in a previous statement: "I made a mistake, and I take responsibility for it." He said failing to disclose the payment was "a serious error in judgment."

Shook Research said it has reached a settlement in which RJ Shook and his wife no longer have roles or ownership in the business. The firm said it will commission an annual, independent third-party review of its governance, methodology, research inputs and conflict controls, and is carrying out a rebrand it started in February.

The fallout extends beyond Forbes. Shook Research doesn't charge for inclusion in the rankings but sells plaques and reprints to advisers who make the lists, sharing that revenue with Forbes. The scandal has raised questions about the integrity of those lists, which advisers use to market themselves to clients. Morgan Stanley's suspension shows the reputational cost for wealth managers that participate, and Forbes' independent review will determine whether the payment compromised any editorial decisions.

This article is for informational purposes only and does not constitute investment advice.