JPMorgan Presses Bloomberg For Breached Data

JPMorgan Presses Bloomberg For Breached Data
By The original uploader was Frank.trampe at English Wikipedia [Public domain], via Wikimedia Commons

JPMorgan Chase & Co. (NYSE:JPM) sent a formal demand letter to Bloomberg requesting data on all staff members since 2008, who have used its terminals to track activities of the bank’s Bloomberg subscribers.

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JPMorgan Presses Bloomberg For Breached Data

In its letter sent this week, the largest U.S. bank is seeking logs for five years of what precisely Bloomberg journalists accessed concerning the use of terminals by JPMorgan Chase & Co. (NYSE:JPM) employees.

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JPMorgan Chase & Co. (NYSE:JPM) is one of the biggest customers of Bloomberg.

The bank’s request comes amid news last week that Bloomberg reporters had viewed the activities of Goldman Sachs Group, Inc. (NYSE:GS) executives through the Bloomberg terminals. This raised concerns among major Wall Street Banks.

Goldman Sachs Group, Inc. (NYSE:GS) was the first to flag the matter to Bloomberg after a news service reporter in Hong Kong asked the bank about a partner’s employment status, noting the person had not logged on in some time. Goldman found that journalists had access to far more information than the bank had known, and argued the information was sensitive and should not be seen by reporters.

The Federal Reserve is also looking into whether Bloomberg journalists tracked data about terminal usage by top Fed officials.

Investment banks like JPMorgan Chase & Co. (NYSE:JPM) and Goldman Sachs Group, Inc. (NYSE:GS) have been paying a substantial price of $20,000 a year for Bloomberg terminals. Bloomberg has installed over 315,000 terminals across the globe, which are considered difficult for clients to give up in view of its sophistication in specialized markets such as Bloomberg’s specialty, bonds.

Bloomberg terminals are virtual ecosystems for traders, where they can negotiate contracts, research currencies or read a restaurant review. The system is priced much like cable television in that clients pay for the whole package even if they use only a small portion of the service

The world’s biggest central banks, including the U.S. Federal Reserve and the European Central Bank, are also Bloomberg customers and said they are asking the media company what journalists could learn about their terminal usage as well.

According to some reports, Morgan Stanley (NYSE:MS) also had dialogue with the media company

Bloomberg has been operating a division called Bloomberg Tradebook since 1996, which acts as a broker dealer, enabling the trade of equities in the U.S. The media company is also applying to the government to be certified to help trade in complex derivatives such as credit default swaps.

[via: WSJ]

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Mani is a Senior Financial Consultant. He has worked in Senior Management role in large banking, financial and information technology organizations. He has provided solutions for major banking and securities firms across the globe in the area of retail, corporate and investment banking. He holds MBA (Finance) and Professional Management Accounting Qualifications. His hobbies are tracking global financial developments and watching sports
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