Here is the news from Bloomberg: we made an inexcusable mistake

Bloomberg has had to grovel after the financial news agency let its reporters access clients' information. Gideon Spanier examines the repercussions

Bloomberg and its notoriously demanding editor-in-chief, Matthew Winkler, are famed for their ultra-competitive approach to financial news. The media giant created by New York's Mayor, Michael Bloomberg, 32 years ago has become a major rival to the established heavyweights Thomson Reuters and Dow Jones, with an enviable reputation for story-getting combined with in-depth data. Big banks and other financial institutions pay $20,000 (£13,000) a year for each terminal, and Bloomberg operates about 310,000 terminals.

But it is fair to say that not everyone in the wider media world likes the company's superior attitude towards journalistic rivals. So there has been more than a hint of Schadenfreude among some in the media industry following the public relations disaster that has befallen Bloomberg in recent days.

The company has been forced to issue a series of apologies after it admitted last week that it let its journalists use internal customer information to inform their coverage when they worked on stories – a scandal that even Bloomberg itself has admitted is "inexcusable".

The most recent and grovelling mea culpa came from Mr Winkler in a personally bylined piece that appeared on the front page of Bloomberg's news service early yesterday morning, as traders returned to work after the weekend.

"Our reporters should not have access to any data considered proprietary. I am sorry that they did," wrote Mr Winkler in the 600-word column, entitled "Holding Ourselves Accountable". "The error is inexcusable."

His apology came as US and European regulators including the Federal Reserve, the European Central Bank and Germany's Bundesbank are considering whether to investigate Bloomberg's behaviour.

Banks including Goldman Sachs and JP Morgan raised concerns after it appeared that reporters had used internal Bloomberg customer information. In at least one case, a journalist was said to have contacted Goldman and suggested that a partner might have left because they hadn't logged into their Bloomberg machine recently.

This is not a scandal that is confined to Wall Street. The shockwaves have been felt in London as JP Morgan has raised questions about Bloomberg's coverage of the bank's huge losses incurred last year, involving a trader dubbed "the London Whale".

Mr Winkler insisted that his reporters had had only limited access to customer data, and claimed that this fact got "lost in much of this weekend's conversation" after the scandal broke. "At no time did reporters have access to trading, portfolio, blotter, monitor 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."

But he admitted that reporters could look at a users' login history and see "high-level types of user functions on an aggregated basis" – such as how many times a user had looked at certain functions on a Bloomberg terminal. "This is akin to being able to see how many times someone used Microsoft Word vs Excel," he said.

Reporters could also see information about helpdesk inquiries when a client contacts Bloomberg and asks for help on how to get a specific piece of information.

Such insight could still be potentially valuable for a journalist chasing a story – despite Mr Winkler's efforts to downplay the scale of the privacy breach. Bloomberg has now barred reporters from such access.

It is too early to say what impact the scandal might have on the reputation of a company which is thought to generate $7bn a year in sales and is highly profitable. Clients have come to depend on Bloomberg's financial data, and there is no sign yet of any customers cancelling accounts.

In the short term, this scandal is hugely embarrassing for Mr Winkler and, of course, for Mr Bloomberg, who owns 80 per cent of the company, even though he is hands-off at present because of his mayoral duties.

This is a company that likes to boast that it does not use anonymous sources and insists on quoting even company spokespeople by name in news articles. "We must be able to confirm it; we must not be speculative; we must not be questionable," Mr Winkler said in a rare 2011 interview. "The essence of Bloomberg is transparency."

The New York Post, owned by Rupert Murdoch's News Corporation, which is also the parent company of Dow Jones and The Wall Street Journal, broke the story last week, and has been crowing about the scandal. "Bloomberg reporters spying on financial clients!" tweeted Mr Murdoch yesterday.

Niri Shan, a reputation management specialist at the London firm of solicitors Taylor Wessing, said: "This disclosure is very damaging. It goes to the heart of the integrity of what they do. Having said that, to fess up in the way they have in a very fulsome way is the best way of dealing with things. Sometimes the way an issue is handled in the aftermath can exacerbate the damage done to reputation. I think they've done absolutely the right thing in the way they have handled it."

The big question is whether this scandal will end with the apology. Regulators, especially in the United States, expect high standards when it comes to financial reporting and disclosure, and are unlikely to take a positive view.

News
newsGlobal index has ranked the quality of life for OAPs - but the UK didn't even make it into the top 10
News
people

Kirstie Allsopp has waded into the female fertility debate again

News
people
News
people
PROMOTED VIDEO
News
peopleStella McCartney apologises over controversial Instagram picture
News
Gillian Anderson was paid less than her male co-star David Duchovny for three years while she was in the The X-Files until she protested and was given the same salary
people

Gillian Anderson lays into gender disparity in Hollywood

Life and Style
Laid bare: the Good2Go app ensures people have a chance to make their intentions clear about having sex
techCould Good2Go end disputes about sexual consent - without being a passion-killer?
Arts and Entertainment
Swiss guards stand in the Sistine Chapel, which is to be lit, and protected, by 7,000 LEDs
art

The Sistine Chapel is set to be illuminated with thousands of LEDs

Arts and Entertainment
Richard Burr remains the baker to beat on the Great British Bake Off
tvRichard remains the baker to beat as Chetna begins to flake
News
i100
Sport
footballArsenal 4 Galatasaray 1: Wenger celebrates 18th anniversary in style
Arts and Entertainment
Amazon has added a cautionary warning to Tom and Jerry cartoons on its streaming service
tv
News
people
News
The village was originally named Llansanffraid-ym-Mechain after the Celtic female Saint Brigit, but the name was changed 150 years ago to Llansantffraid – a decision which suggests the incorrect gender of the saint
newsA Welsh town has changed its name - and a prize if you can notice how
News
ebooksAn unforgettable anthology of contemporary reportage
Arts and Entertainment
Kristen Scott Thomas in Electra at the Old Vic
theatreReview: Kristin Scott Thomas is magnificent in a five-star performance of ‘Electra’
Life and Style
Couples who boast about their relationship have been condemned as the most annoying Facebook users
tech
Arts and Entertainment
Hayley Williams performs with Paramore in New York
musicParamore singer says 'Steal Your Girl' is itself stolen from a New Found Glory hit
News
i100
Sport
Ronaldinho signs the t-shirt of a pitch invader
footballProof they are getting bolder
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Trust Accountant - Kent

NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...

Graduate Recruitment Consultant - 2013/14 Grads - No Exp Needed

£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...

Law Costs

Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...

Day In a Page

Italian couples fake UK divorce scam on an ‘industrial scale’

Welcome to Maidenhead, the divorce capital of... Italy

A look at the the legal tourists who exploited our liberal dissolution rules
Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

The vintage series has often been criticised for racial stereotyping
An app for the amorous: Could Good2Go end disputes about sexual consent - without being a passion-killer?

An app for the amorous

Could Good2Go end disputes about sexual consent - without being a passion-killer?
Llansanffraid is now Llansantffraid. Welsh town changes its name, but can you spot the difference?

Llansanffraid is now Llansantffraid

Welsh town changes its name, but can you spot the difference?
Charlotte Riley: At the peak of her powers

Charlotte Riley: At the peak of her powers

After a few early missteps with Chekhov, her acting career has taken her to Hollywood. Next up is a role in the BBC’s gangster drama ‘Peaky Blinders’
She's having a laugh: Britain's female comedians have never had it so good

She's having a laugh

Britain's female comedians have never had it so good, says stand-up Natalie Haynes
Sistine Chapel to ‘sing’ with new LED lights designed to bring Michelangelo’s masterpiece out of the shadows

Let there be light

Sistine Chapel to ‘sing’ with new LEDs designed to bring Michelangelo’s masterpiece out of the shadows
Great British Bake Off, semi-final, review: Richard remains the baker to beat

Tensions rise in Bake Off's pastry week

Richard remains the baker to beat as Chetna begins to flake
Paris Fashion Week, spring/summer 2015: Time travel fashion at Louis Vuitton in Paris

A look to the future

It's time travel fashion at Louis Vuitton in Paris
The 10 best bedspreads

The 10 best bedspreads

Before you up the tog count on your duvet, add an extra layer and a room-changing piece to your bed this autumn
Arsenal vs Galatasaray: Five things we learnt from the Emirates

Arsenal vs Galatasaray

Five things we learnt from the Gunners' Champions League victory at the Emirates
Stuart Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

This deal gives England a head-start to prepare for 2019 World Cup, says Chris Hewett
Ebola outbreak: The children orphaned by the virus – then rejected by surviving relatives over fear of infection

The children orphaned by Ebola...

... then rejected by surviving relatives over fear of infection
Pride: Are censors pandering to homophobia?

Are censors pandering to homophobia?

US film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence
The magic of roundabouts

Lords of the rings

Just who are the Roundabout Appreciation Society?