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Bloomberg Responds To Surveillance-Gate

Tyler Durden's picture





 

In the aftermath of the tempest in a teapot scandal surrounding the Bloomberg surveillance of its clients (maybe one should also inquire just what data FaceBook investor Goldman Sachs, not to mention various other data vendors, has on all FaceBook users just to be fair; or whether Goldman feeds its prop desk with REDI trading data ahead of "best-practices" execution; of whether Blue Horseshoe's contact at 555-7617 leaks any material source info to their best connections before an article gets published), which hit a crescendo over the weekend (and certainly brings a new meaning to the Bloomberg radio show "Surveillance"), the firm owned by one of the world's wealthiest men offered its explanation. Here is the full response by Bloomberg's editor-in-chief Matt Winkler.

Holding Ourselves Accountable

As I wrote in “The Bloomberg Way,” our guide for reporters and editors, “The appearance of impropriety can be as damaging to a reputation as doing something improper. Because we hold others accountable for disclosure, we expect the same of ourselves. While disclosing errors of judgment may be embarrassing, the sooner the lapses are reported, the sooner there is nothing more to say.”

We are defined by our words -- and they applied to us when a Bloomberg LP customer expressed concern that Bloomberg News reporters had access to limited client information. Our client is right. Our reporters should not have access to any data considered proprietary. I am sorry they did. The error is inexcusable. Last month, we immediately changed our policy so that reporters now have no greater access to information than our customers have. Removing this access will have no effect on Bloomberg news-gathering.

Now let’s also be clear what our reporters had access to. First, they could see a user’s login history and when a login was created. Second, they could see high-level types of user functions on an aggregated basis, with no ability to look into specific security information. This is akin to being able to see how many times someone used Microsoft Word vs. Excel. And, finally, they could see information about help desk inquiries.

Why did reporters have access to this in the first place? The recent complaints go to practices that are almost as old as Bloomberg News. Since the 1990s, some reporters have used the terminal to obtain, as the Washington Post reported, “mundane” facts such as log-on information. There was good reason for this, 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. Equally important is our commitment to transparency, which is why “The Bloomberg Way” is a public document.

As we’ve grown, and 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. And that’s why we’ve made these recent changes to what reporters can access.

This leads to a second point lost in much of this weekend’s conversation: The protection of important customer data has been essential at Bloomberg since our founding more than 30 years ago. We have never compromised the integrity of that data in our reporting.

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.

Like all other Bloomberg employees, our reporters, upon hiring, enter into a confidentiality agreement that strictly prohibits them from discussing non-public Bloomberg documents and proprietary information about the company and its clients in their reporting.

Our editorial and reporting standards have been among the most stringent in the business for more than 20 years. We apologize for our error as it does not reflect on our culture or our heritage. And we will strive to continue to uphold the highest standards while adhering to the best practices in the industry as long as we may be fortunate to serve our customers as they would have us serve them.

 


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Mon, 05/13/2013 - 07:15 | Link to Comment sus sapientiae
sus sapientiae's picture

Data privacy.... another example of an oxymoron.

Mon, 05/13/2013 - 07:19 | Link to Comment markmotive
markmotive's picture

You are being watched!

Mon, 05/13/2013 - 07:30 | Link to Comment Chuck Walla
Chuck Walla's picture

If this was Murdoch, they would looking for a rope by now.

FORWARD SOVIET!

Mon, 05/13/2013 - 07:34 | Link to Comment Rory_Breaker
Rory_Breaker's picture

All your data is belong to us.

Mon, 05/13/2013 - 07:47 | Link to Comment Parisnights
Parisnights's picture

Almost sounds like a sniveling mea culpa."we promise to do better"  Put G. Carlin in charge of the company and print a two letter sound bite.     "Bite US"  Carlin for President  Bariilo "big Daddy Peppe" for VP

Mon, 05/13/2013 - 08:01 | Link to Comment ParkAveFlasher
ParkAveFlasher's picture

"Hey guys, I signed up for that list too.  What giv3s?"   #BillGross@PIMCO

Mon, 05/13/2013 - 08:32 | Link to Comment espirit
espirit's picture

...So, the reporters didn't have access to particularly sensitve data, but who the fuck did?

I'd be looking into those orgs that had perfect + profit trading days.

Let's see,  JPMC and BoA come to mind - follow the money.

Meh.

Mon, 05/13/2013 - 07:35 | Link to Comment Ghordius
Ghordius's picture

looking for a rope? if I remember the case correctly The Old Man had to travel to London, give a few tears in public, fire a few scapegoats, close a few unconsequential businesses and then was busy lecturing a gaggle of MPs all hanging enchanted to every word he uttered

Mon, 05/13/2013 - 07:49 | Link to Comment gatorengineer
gatorengineer's picture

And co-incidently at that exact same time, Fox News took a hard left turn......  Co-incidence, I think not.

Mon, 05/13/2013 - 08:04 | Link to Comment Ghordius
Ghordius's picture

"Fox News took a hard left turn"? Really? Don't watch enough of that to judge, so please expand. They aren't reporting about the Prison Industrial Complex, I presume

The Old Man met Farage, the leader of the UKIP - don't think this is a sign that he has stopped seeing the EU as a still too closed oyster for his biz, yet, and it sure puts some pressure on Cameron to swerve more on the right

of course left and right have a different flavour in certains matter between the US and the UK

Mon, 05/13/2013 - 07:15 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

We apologize for our error

 

Now go screw yourselves.

Mon, 05/13/2013 - 07:31 | Link to Comment Ghordius
Ghordius's picture

a small correction: we apologize for our error because the Squid and the Morgue complained

Mon, 05/13/2013 - 07:16 | Link to Comment Gringo Viejo
Gringo Viejo's picture

Speaking only for myself, I'm on "sociopaths and their explanation of events" overload. Somebody mix me another drink.

Mon, 05/13/2013 - 07:19 | Link to Comment firstdivision
firstdivision's picture

Why doesn't Bloomberg install the same Chinese Walls that they have at IB to keep Prop from seeing client flow?

Mon, 05/13/2013 - 07:19 | Link to Comment Apostate2
Apostate2's picture

Now I'm having a laugh.

Stringent, our culture and heritage. highest standards, Oops. serve our customers as we would serve them. Who writes this stuff. Maybe creative writing has a lucrative future.

 

Mon, 05/13/2013 - 07:19 | Link to Comment Proofreder
Proofreder's picture

Well, that was refreshing.  A far cry from ...

No, we didn't do it and if we did it was only for a short time and it will never happen again if indeed it ever did.

... nothing to see here, move along.

Mon, 05/13/2013 - 07:22 | Link to Comment buzzsaw99
buzzsaw99's picture

you can't spend your whole life worrying about your mistakes, you fucked up, you trusted us... [/otter]

http://www.youtube.com/watch?v=LARx7M9s15w

Mon, 05/13/2013 - 07:25 | Link to Comment MythicalFish
MythicalFish's picture

Blue Horseshoe, haha. Old school. Used to be extension 1605 though.

Mon, 05/13/2013 - 07:28 | Link to Comment buzzsaw99
buzzsaw99's picture

555-7617 = cnbc

Mon, 05/13/2013 - 07:25 | Link to Comment bustdrs
bustdrs's picture

The Bloomberg public reporting service used to be a reliable news source for financial professionals. For example, documenting rating agencies and other associated inconsistencies, a balanced view on gold and some criticism of the price setting derivative complex.
This type of journalism has ceased to exist at Bloomberg and more tows to MSM type reporting.
Fear or greed?

Mon, 05/13/2013 - 07:27 | Link to Comment razorthin
razorthin's picture

Remember that Bloomberg (da mayor, der fuhrer) is Bloomberg.

Mon, 05/13/2013 - 07:27 | Link to Comment shovelhead
shovelhead's picture

He sees you when you're sleeping

He knows when you're awake

He knows if you've been bad or good

And he's always on the take.

 

 

Mon, 05/13/2013 - 07:29 | Link to Comment Skin666
Skin666's picture

Goldman Sucks don't like surveillance...

Boo fucking hoo...

 

Mon, 05/13/2013 - 07:33 | Link to Comment Burr's 2nd Shot
Burr's 2nd Shot's picture

CNBC is beclowning themselves with their coverage of this story.

Mon, 05/13/2013 - 07:40 | Link to Comment NoDebt
NoDebt's picture

Yeah, they just had Harvey Pitt on there giving Bloomberg a tongue lashing.  Sure, that guy has TONS of credibility.  Whole market tanks under his watch and he does nothing.  Now he's out and suddenly he's a tough guy.  How come they only "get tough" after they're gone? 

Mon, 05/13/2013 - 08:53 | Link to Comment j0nx
j0nx's picture

Yeahp. Same story with Sheila Bair. Now that she's out she's a champion for bank reform. Give me a fucking break Sheila.

Mon, 05/13/2013 - 07:55 | Link to Comment Parisnights
Parisnights's picture

Bimbo (becky) and Bozo (Joe) look tired. Maybe they had a weekend gig in the hamptons.  or maybe a party for christy  (all liquid refreshments)  Either way, these no talent ass clowns should retire and work for the IRS.  I hear they'll have a few openings soon.

Mon, 05/13/2013 - 07:34 | Link to Comment stant
stant's picture

squid on squid violence. ban something

Mon, 05/13/2013 - 07:59 | Link to Comment Parisnights
Parisnights's picture

squid on squid violence. ban something

Now that's funny  +100    "Get research in here- find out all we have on past squid on squid violence,  we go to copy in one hour"

Mon, 05/13/2013 - 07:36 | Link to Comment Slope of Hope
Slope of Hope's picture

It begs the question of how much of this information made its way to SAC and other hedge funds?  Of course, Wall Street is far too honest to pay reporters for tips.

Mon, 05/13/2013 - 07:55 | Link to Comment Miss Expectations
Miss Expectations's picture

Is it really only the reporters and editors we should be worried about?

Mon, 05/13/2013 - 08:04 | Link to Comment blindman
blindman's picture

http://grooveshark.com/s/Cold+Irons+Bound/4uR1A8?src=5
Cold Irons Bound by Tom Verlaine & ...
.
cold irons bound, bob Dylan
http://grooveshark.com/#!/search?q=cold+irons+bound++bob+dylan

Mon, 05/13/2013 - 08:24 | Link to Comment chindit13
chindit13's picture

Maybe the reporters at Bloomberg couldn't see key customer data, but somebody at Bloomberg can, and that somebody has value to the trading community.  I suspect that if this leads anywhere, it will lead to some HF that is paying to find out positions in certain equities or bond issues.  Top HFs would be too smart to leave this sort of electronic trail, but others might be more trusting, and thus open themselves up to abuse.  Such occurrences are almost inevitable, despite the confidentiality agreement that strictly prohibits base human nature from acting out and pursuing possibilities for personal gain.  Bloomberg is essentially a cloud, and many clouds have silver linings.

Mon, 05/13/2013 - 08:43 | Link to Comment breakyoself
breakyoself's picture

All I see on Bloomberg is Langone with a mouth full of Jamie's dick.

Mon, 05/13/2013 - 10:14 | Link to Comment Cacete de Ouro
Cacete de Ouro's picture

So what about Bloomberg journalists buying dinner for traders who give good tips? The better the tip, the nicer the restaurant...True...!

Is this ethical? What does Little Matty Winkler have to say about this?

 

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