Bloomberg LP Corrects Big 'Mistake' in Newsgathering Practices -- Plus: Spying on Bernanke?

Bloomberg terminals. (Wiki Commons)

LOS ANGELES (TheBlaze/AP) -- Yesterday, TheBlaze reported on financial data and news company Bloomberg LP correcting a "mistake" in its newsgathering policies by cutting off its journalists' special access to client log-in activity on the company's ubiquitous trading information terminals.

Goldman Sachs became concerned about the outside access after a Bloomberg reporter, investigating what she thought was the departure of a Goldman employee, told the securities firm that the employee had not logged into a Bloomberg terminal for a number of weeks.

After the complaint last month, Bloomberg "immediately" turned off its journalists' special access and limited it to what clients can see themselves, he said.

Before, Bloomberg News reporters had been able to see when any of the company's 315,000 paying subscribers, mostly stock and bond traders, had last logged into the service. They could also view the types of "functions" individual subscribers had accessed.

For instance, reporters could see if subscribers had been looking at top news stories, or if they had been gathering data on stocks or bonds, but not which stories or bonds and stocks they had looked up, said Ty Trippet, a Bloomberg LP spokesman. He said reporters could also see if subscribers were using "message" or "chat" functions to send messages to each other over the terminals, but not the recipient of the messages or their content.

Now, the full picture of just how much the 2,400 journalists at Bloomberg LP may have viewed is emerging.

According to CNBC, even the activity of government officials may have been accessed:

A Fed spokesperson told CNBC that the central bank is looking into the situation and has been in touch with Bloomberg to learn more. A source said the Treasury Department is taking similar action.

Meanwhile, CNBC has learned from a former Bloomberg employee that he accessed usage information of the company's data terminals of Federal Reserve Chairman Ben Bernanke and former U.S. Treasury Secretary Tim Geithner.

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The former Bloomberg employee who worked in the editorial section recalled calling up the information on Fed Chairman Ben Bernanke and Treasury Secretary Tim Geithner "just for fun" and displaying the information to new recruits "to show how powerful" the Bloomberg terminals were.

A Bloomberg representative reportedly told CNBC that "what you are reporting is untrue," but did not say what exactly was inaccurate.

Although Goldman's concerns caused the change, JPMorgan Chase & Co. have also expressed concerns about Bloomberg journalists' access to sensitive data.

A person familiar with the matter at JPMorgan said multiple Bloomberg reporters had used the data to try to break news in the last several years. One reporter knew details about the log-in times of multiple traders on a single desk and called daily to ask about potential layoffs, the person said. JPMorgan complained to the reporters about the technique but Bloomberg managers weren't made aware of a formal complaint.

Bloomberg's Trippet said he was unaware of complaints from JP Morgan to reporters or editors.

It's not clear exactly how long Bloomberg reporters have been accessing subscriber information.

"Limited customer relationship data has long been available to our journalists," Trippet wrote in an email. The access dates back to the 1990s, when Bloomberg's news operation began. Journalists would join sales representatives on calls to clients, he said, to explain how Bloomberg's news functions work.

Bloomberg journalists are renowned for aggressive techniques in a competitive field. Bloomberg LP, whose main business is selling terminals to clients in the financial industry, employs more than 2,400 journalists.

In November 2010, the news service reported on the earnings of The Walt Disney Co. and NetApp Inc. well before the companies' scheduled releases by guessing the unprotected website addresses of the press releases before they were made public.

The public relations gaffes, which resulted in immediate but fleeting dips in the stock prices of both companies, resulted in the companies taking action to prevent a recurrence.

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Associated Press Business Writer Bernard Condon contributed to this report from New York.