UPDATE 2-Bank of England says Bloomberg data use "reprehensible"

Tue May 14, 2013 4:17pm EDT
 
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LONDON May 14 (Reuters) - The Bank of England said on Tuesday it was "reprehensible" for Bloomberg News to allow journalists to see data on how clients used its financial information terminals, saying confidentiality was crucial to its work as a central bank.

It was one of the toughest assessments yet of Bloomberg's practice of giving reporters limited access to data considered proprietary, such as when a customer logs in, contacts the help desk or delves into the system for information about specific asset classes, like equities or bonds.

The list of central banks that have said they were examining Bloomberg's use of data includes the U.S. Federal Reserve, the European Central Bank, the Bank of Japan, the Bank of Canada, Germany's Bundesbank and the Hong Kong Monetary Authority, but they have avoided any direct comment on the matter.

The British central bank was less restrained as it registered concern over a practice that Bloomberg said had been in effect since its early days in the 1990s but only came to light last week.

"The protection of confidential information is vital here at the bank. What seems to have happened at Bloomberg is reprehensible," a Bank of England spokesman said on Tuesday.

"Bank officials are in close contact with Bloomberg, who have provided assurances to ensure that this does not happen again. We will also be liaising with other central banks on this matter."

While there is no evidence the access given to Bloomberg reporters led to the disclosure of confidential data from central banks, the potential for security breaches is a matter of concern for policymakers. Their effectiveness in guiding the global economy depends on keeping the process of setting interest rates and using other monetary tools confidential, and they go to great lengths to protect against leaks.

"We regret the Bank of England has taken this position but we'll continue to engage with its management and staff to address their concerns," said Ty Trippet, a spokesman for Bloomberg LP, the news service's parent.   Continued...