Fed, Treasury to probe Bloomberg's data security after privacy breach

The US Treasury Department and the Federal Reserve are reported to be examining the extent to which Bloomberg reporters tracked officials' use of information carried on Bloomberg terminals, a device that dominates trading desks from New York to London and beyond.

The US Treasury Department and the Federal Reserve are reported to be examining the extent to which Bloomberg reporters tracked officials' use of information carried on Bloomberg terminals, a device that dominates trading desks from New York to London and beyond.

Bloomberg employees are even said to have accessed details of ex-Fed chief Alan Greenspan's contacts with the company's help desk.

The inquiry follows revelations Goldman Sachs and JP Morgan Chase were angered that Bloomberg reporters were using the terminals to identify employees who might have left the two banks.

Bloomberg chief executive Dan Doctoroff has declared the practice a "mistake" and executives have reportedly apologised in person to executives of Goldman Sachs, one of its biggest customers.

"Last month we changed our policy so that all reporters only have access to the same customer relationship data available to our clients," Mr Doctoroff said.

Whether the aggrieved customers will be satisfied with reduced reporter access remains to be seen, although apparently none of Bloomberg's 315,000 paying customers is known to have cancelled the service over the breach.

Even 10 years ago, many employees were familiar with the internal function on the terminal that allowed them to observe client use, including whether a customer is interested in equities or bonds by revealing the number of times certain category keys are tapped.

On the one hand, such knowledge enabled Bloomberg to hone its service and helped swell annual sales to about $US8 billion. New York mayor Michael Bloomberg, with an 88 per cent stake in the firm, is worth about $US27 billion and the 13th richest person on the planet, Forbes magazine said in March.

Employees have also been able to see the time and date a user last logged onto the service - hence the reporter inquiries into whether certain Goldman or JP Morgan staff were still in a job.

A more recent offering, though, may cause more concern. Queries to the help desk about how to deploy complex analytics to determine the relative value of a particular asset may inadvertently have helped tip off reporters.

The wide internal access to such interactions may be less amusing if authorities suspect insider information at play. Certainly, the action to bar Bloomberg's 2000-plus reporters from such access in the future, still leaves open the question: what of its 13,000 other employees?

The author is a former Bloomberg employee.

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