Most people probably know Mark Cuban as the always outspoken and sometimes controversial owner of the Dallas Mavericks -- currently knee-deep in the NBA Finals and up two games to one over the Miami Heat. The TV cameras often show Cuban pacing the sidelines or nestling up to the Mavs' bench, and he uses his personal blog to discuss the games or criticize the officials.

But Cuban wouldn't own the Mavericks if he wasn't also a businessman. He made his first billion when he sold to Yahoo! (NASDAQ:YHOO), and he parlayed that windfall into not only a pro basketball team, but also cable network HDNet. Cuban still serves as chairman and president of Yahoo! Broadcast.

And he talks business on that blog, too. One recent post talks about a website that he's about to launch, focused on uncovering corporate wrongdoing in all its forms -- and report on it all in an entertaining manner. So far, so Foolish, and I applaud that initiative. Cuban wants to reach the young and the uninterested by turning, in his example, the Enron scandal into a parody animation to the tune of Shaggy's "It Wasn't Me," backed by professional-grade journalistic investigation.

But don't expect to find anything like our own Foolish disclosure rules on that site. In fact, Cuban explicitly says that he has no problem with trading on the information his site unearths before making it public knowledge. In his own words:

A journalistic conflict, you say? Not any more. Not in this world. It will be fully disclosed and explained. This site is for the profit of its owners, and we will buy and sell stocks that are discussed, before they are made available on the site. [...] If we can uncover companies whose stock is public and that can be bought or sold and that allows us to pay for more in depth research and effort, I'm good with that.

So he wants the ends to justify the means, and on the surface of it, that doesn't sound unreasonable. But think about it. For one, this modus operandi cuts awfully close to the kind of shady business practices the site itself wants to uncover. Here at the Fool, we're firm supporters and part instigators of Regulation FD (Fair Disclosure), and I would question the motives of Cuban's reporters, especially since there don't appear to be any trading restrictions in place.

When you have a huge soapbox available for trumpeting your insights and opinions, your words can presumably move stock prices. I don't have any illusions about affecting Google's (NASDAQ:GOOG) or General Electric's (NYSE:GE) market caps much through this simple keyboard, but drop down to the small-cap realm of Zapata (NYSE:ZAP) or Saga Communications (NYSE:SGA), and things look different.

Assuming that Mark Cuban's site gains a significant readership -- and he's got the deep pockets to make that happen through marketing -- it would be easy to find some dirt on a micro-cap, short the stock, and then drop the news on the public. Cover the short position, rake in profits, rinse, repeat. The only people getting hurt are dirty companies and their shareholders, right?

But it's a slippery slope. If the method proves too successful, there's the temptation to go with less reliable reports and sources only to make a quick buck. And the next step is outright fabrication. Once that happens, journalistic integrity is out the window, and the scary part is that people who signed on to the site's original intent may still believe every word and trade on information only loosely based in reality -- or worse. There is a real need for checks and balances, no matter how much Mark Cuban "discloses and explains" the lack of them.

If I talk about stocks I own here, like Netflix (NASDAQ:NFLX) or Bank of America (NYSE:BAC), the Fool won't let me touch those holdings 10 days before or after publishing the article. I also write for a few other sites that don't have any restrictions of that nature (since they're not really about financial news), but I believe in the concept so much that I decided to stick with that rule even where it's not strictly necessary. And I've done that since way before joining the Fool.

So Mark, put your thinking cap back on. You have a chance to do something really good and valuable here, providing a service that the public and the business world both sorely need. We've spoken before, and you have a good head on those shoulders; you just need to rethink the consequences of the current plan and adjust accordingly. Another pump-and-dump forum doesn't do anybody any good, and it would be a real disservice to your stated goals.

The Fool could certainly use another ally against corporate mischief. Just do it right.

Further Foolish reading:

  • Small caps can be Foolish caps, too.
  • Warren Buffett stands to gain from more disclosure.

Bank of America is a Motley Fool Income Investor selection, and Netflix lives in the Motley Fool Stock Advisor portfolio. Anders clearly doesn't mind holding them both for at least another 10 days -- try a 30-day trial subscriptiontoany of our newslettersand see whether you'd like to hold stocks like these, too.

Fool contributor Anders Bylund really does believe in full Foolish disclosure, and yes, he does own Bank of America and Netflix stock. He's also 6'6", but he's useless on the basketball court.