Reporters at Bloomberg had the ability to view the log-in history and certain other account details of the company's clients.
In a mea culpa posted today, Bloomberg News editor in chief Matthew Winkler fessed up to the practice, revealing that reporters had access to Bloomberg terminals through which they could see a user's log-in history and find out when the account was created.
The terminals are computer systems used by both Bloomberg and its subscribers to access the latest financial news and stock quotes and to exchange messages over the firm's secure network.
Reporters also could see "high-level types of user functions," which Winkler compared to seeing how many times someone used Microsoft Word vs. Excel. Further, they were able to grab information on calls to the firm's help desk.
Why were reporters able to see this information?
"There was good reason for this," Winkler said, "as our reporters used to go to clients in the early days of the company and ask them what topics they wanted to see covered. Understanding how clients used the terminal was more important then. We still do that today, which is why we have feedback tabs on our news-related terminal functions."
Winkler stressed that reporters had no access to trading, portfolio, or stock monitoring systems. They were unable to see the stories being read by or the stocks being researched by the firm's clients, nor could they peek at messages sent from one client to another. Further, Bloomberg reporters sign a confidentiality agreement that prevents them from disclosing any non-public information in their news stories.
Still, Winkler acknowledged that the practice was wrong, apologizing for it and saying "the error is inexcusable." He also revealed that the news organization changed the policy last month so that reporters now have the same level of access as do the firm's clients.
The snooping itself may have been a bit more severe than Winkler described in his editorial.
Reporters were allegedly trained to use the terminals to view the contact information of subscribers and monitor their log-in activity for news coverage, a half dozen former Bloomberg employees told The New York Times. The reporters were told to use the terminals to gain an edge in writing their news stories, the ex-employees revealed. However, a Bloomberg spokesman said on Sunday that "reporters would not have been trained to improperly use any client data," the Times added.
The practice came to light after one of Bloomberg's clients, identified by the Times as Goldman Sachs, expressed concerns that a reporter had accessed limited client information. Reporters may also have monitored the log-in information of executives at JPMorgan Chase last year. The Federal Reserve and Treasury Department are currently investigating whether Bloomberg reporters tracked client information, the Times said.