The New York Post reported this month Bloomberg reporters had access to and were reviewing data from the company's subscription data service -- represented by Bloomberg terminals, which cost $20,000 per year. There are 315,000 subscriptions to the service, which provides clients with up-to-date financial news and data and provides message and real-time chatting options.
The revelation came in two incidents -- one at JPMorgan Chase and one at Goldman Sachs -- in which reporters inquired about the status of executives for news stories and let it be known that they were aware of when the executives last logged onto their Bloomberg terminals.
Bloomberg admitted the breach of privacy quickly, calling the practice of allowing reporters access to subscriber data a mistake. Bloomberg said Friday it has hired former IBM Chairman and Chief Executive Officer Samuel Palmisano to conduct a review of its privacy policies and practices, and has hired consulting firm Promontory Financial Group to help the former IBM executive with the review.
On top of that, Bloomberg said it had hired Hogan Lovells, a law firm, to help out, and is conducting an in-house review, headed by editor-at-large Clark Hoyt.
The announcement indicates Bloomberg is reaching for help among professionals with deep ties to Wall Street firms that subscribe to Bloomberg, The Wall Street Journal said Saturday.
The attempt to put together a credible review of the company is being thrown together while various subscribers, including JPMorgan, have requested Bloomberg provide them with logs of reporter activities related to their subscriptions.
Other firms are reported to be looking at replacing at least some of the services that come with the Bloomberg terminals -- such as messaging and chat options -- with their own in-house services to protect proprietary communications.
"I'm not sure they can erase all their problems. These things are hard to get over," Larry Tabb, founder of the research firm Tabb Group, told the Journal.
Bloomberg, however, is "taking the right steps to maintain the confidence of their customers," Morgan Stanley Chairman and Chief Executive Officer James Gorman said in a statement.