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Bloomberg private messages leaked online: report

AP/ Reuters/ SMH | May 15, 2013
Financial data and news service Bloomberg accidentally leaked more than 10,000 private messages online containing sensitive pricing data exchanged by users of Bloomberg's financial information service, according to a report.

He said the practice dated back to the early days of Bloomberg News in the 1990s, when reporters used the terminal to find out what kind of news coverage customers wanted.

"As data privacy has become a central concern to our clients, we should go above and beyond in protecting data, especially when we have even the appearance of impropriety," Winkler wrote. "And that's why we've made these recent changes to what reporters can access."

Bloomberg's book
Data security was an issue that company founder Michael Bloomberg wrestled with in his 1997 book Bloomberg by Bloomberg. In general, he wrote, restricting access to proprietary information can be an ineffective exercise.

Often "the whole data security issue is overblown at most corporations that think they have a lot to guard," wrote Bloomberg, who has been mayor of New York City since 2002. "Pilferage and leakage are costs of doing business. Live with them. While some restrictions make sense, many are ridiculous."

When asked on Monday about the current controversy, Bloomberg said he could not comment because of his agreement with the city's conflicts of interest board. The mayor, who Forbes has said has a net worth of $US27 billion, has not been involved in the day-to-day operations of Bloomberg LP for almost 12 years.

In his statement, Winkler emphasised that Bloomberg News "has never compromised the integrity of that data in our reporting" and said Bloomberg journalists are subject to standards that are among the most stringent in the business.

"At no time did reporters have access to trading, portfolio, monitor, blotter or other related systems," he said. "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."

Even though the information available to Bloomberg reporters was limited, senior Goldman executives argued that a trader could profit just by knowing what type of securities high-profile users were looking at, or what questions a government official raised with Bloomberg's help desk, people with direct knowledge of their views said.

The issue made people inside the bank uncomfortable with even the Bloomberg marketing and sales team's access to information, the sources said.

In disclosing the new restrictions set last month, chief executive Daniel Doctoroff said Bloomberg had created the position of client data compliance officer to ensure that its news operations never have access to confidential customer data.

Closely held Bloomberg, which competes with Thomson Reuters, the parent of Reuters News, gets the bulk of its revenue from terminal sales to financial institutions.

Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $US20,000 a year. Last year it posted revenue of $US7.9 billion.

 

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