US Treasury investigates Bloomberg 'spying' claim
The US Treasury and Federal Reserve are investigating whether Bloomberg journalists “spied” on staff by tracking the way they used Bloomberg terminals.
They are among a slew of Bloomberg customers seeking urgent answers from the media and financial data company over potential privacy breaches, after it emerged that journalists been using the $20,000-a-year information feeds to keep tabs on individual users.
Goldman Sachs was first to raise the alarm with Bloomberg. Senior executives at the investment bank confronted the company after journalists admitted they had been checking up on its staff.
Reporters were able to check up on when individual users accessed the machines, which news stories they read, and how often they used other functions such as the Bloomberg messaging service.
They were also able to see a sudden surge in the number of staff checking an individual’s Bloomberg profile, potentially helping them to identify traders at the centre of banking scandals before their names were formally made public. Sources close to Bloomberg claim that the practice was widespread and used openly.
Bloomberg cut off journalists’ access to this sort of information within 24 hours of Goldman Sachs’ complaint, which was made public last week. A spokesman said it had done so “in light of [Goldman’s] concern as well as a general heightened sensitivity to data”.
Matthew Winkler, the editor in chief of Bloomberg News , apologised to clients in a op-ed published on Bloomberg's website on Monday.
"Our reporters should not have access to any data considered proprietary. I am sorry they did. The error is inexcusable," the publication's top editor," he wrote.
Mr Winkler stressed: "At no time did reporters have access to trading, portfolio, monitor, blotter or other related systems. Nor did they have access to clients’ messages to one another. They couldn’t see the stories that clients were reading or the securities clients might be looking at."
However, the media company now faces a battle to reassure customers that the Bloomberg terminals, which are widely used across the City to access real-time share prices and financial news, do not present a security risk.
JP Morgan is understood to have raised concerns about journalists accessing information about its staff to inform coverage of the “London Whale” scandal last year.
According to reports, America’s Securities and Exchange Commission may also be investigating the apparent security breach. It is not clear whether it would be doing in its capacity as a regulator, or as a Bloomberg customer.