Bloomberg is tightening up its client data policies and restricting its journalists' access to large amounts of sensitive internal information, following two reviews into the global news and financial information giant triggered by a snooping scandal.
The client data scandal blew up in April when a Bloomberg journalist approached Goldman Sachs about a partner's employment status, which led to a complaint from the investment banking giant.
It emerged that journalists had access to client data held by Bloomberg, which provides financial information to market professionals through paid-for terminals at banks across the world.
In May, Bloomberg appointed London-based global law firm Hogan Lovells and Promontory Financial Group, a regulatory compliance business, to conduct an external review of its client data controls.
Bloomberg also asked Clark Hoyt, former editor-at-large at Bloomberg News and public editor of the New York Times, to head an internal review of the ties between its journalists and commercial departments.
The two reviews were based on an examination of almost 500,000 news articles, over 400 interviews with Bloomberg employees, analysis of more than 350 documents, and 230,000 tests of client data systems.
The external review found that Bloomberg journalists had accessed client details such as recent log-ins and contact information for the purpose of reporting, but both probes praised existing client data policies and controls.
They made a number of recommendations to beef the policies up, however. Hoyt's review suggested separating reporters and salespeople, as well as appointing a standards editor.
Bloomberg has already hired ex-IBM chairman and chief executive Samuel J. Palmisano as an independent adviser to the company's Board of Directors.
"Bloomberg's leadership recognised the need for a more comprehensive set of policies and procedures. Based on my own observations, I support the report's conclusion that Bloomberg currently has appropriate policies and controls in place," Palmisano said.
Among the several actions suggested to Bloomberg which the firm said it will undertake, the company is already in process of hiring a chief risk and compliance officer.
Moreover, Bloomberg journalists now have the same access to client data that non-employee terminal users have, and reporters are no longer able to use the system's anonymous chat rooms.
"We know we needed to evolve, and we have learned from our mistakes. We are already implementing many of the recommendations we received," Bloomberg's chief executive officer, Daniel Doctoroff, said in a recent statement.
"Most importantly, we have carefully listened to our clients and other constituencies, and their suggestions are helping make us a better partner."