Bloomberg News Used Private Client Data To Spy On Ben Bernanke And Tim Geithner

Both the Federal Reserve and the US Treasury Department are examining the extent to which Bloomberg-terminal usage by top officials might have been tracked by Bloomberg journalists, CNBC has learned.

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.

The information appeared to concern general functions used by the officials and the frequency with which those functions — such as looking at a bond, equity markets or news — were accessed. The source said all Bloomberg journalists who knew of this capability of the terminal would have had access to the usage information of the officials. However, CNBC has no information that the data were either used by the employees for journalism or shared inappropriately.

In response to queries that Bloomberg journalists had access to officials data usage, a Bloomberg spokesman said, "What you are reporting is untrue" but declined to respond when asked what specifically was inaccurate. He also would not say whether the company had investigated journalists' access to this information.

CNBC is a competitor of Bloomberg in reporting and distributing business news on the web and on television.

The issue of Bloomberg journalists' access to individual data from the terminals was revealed in recent days when a reporter called a Goldman Sachs Group employee inquiring about a partner's employment status and noting the partner had not logged on to the terminal lately.

The incident prompted a complaint from Goldman and led Bloomberg to terminate the ability of reporters to monitor subscribers.

In a statement on its website, Bloomberg said, "Having recognized this mistake, we took immediate action. Last month we changed our policy so that all reporters only have access to the same customer-relationship data available to our clients."

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.

The former employee said he recalled seeing the functions used by the Fed Chairman and Treasury Secretary and the number of times those functions had been used. The person did not recall which specific functions he saw, but said it would have been at a broad level. For example, he said it would likely have been information that the official accessed a page such as global equity indexes, though not which markets specifically. He said it also could have included information that the user looked up bond spreads, but the information would not have shown what specific bonds were searched by the user.

Still, with thousands of functions, the information could apparently get quite specific. And knowing how often a user looked up individual information and how often the user was logged in could provide valuable information.

A JP Morgan Chase source told CNBC that, "Multiple Bloomberg reporters very openly were using terminal login data to determine when traders were suspended and/or let go — during the London Whale situation, as well as during other rounds of layoffs."

A Quartz story (www.qz.com) said Bloomberg journalists had accessed a transcript of a call of former Fed Chairman Alan Greenspan to the company's help desk. The story said the information was not used in any editorial pieces written by journalists.

—By CNBC's Steve Liesman. Follow him on Twitter: @steveliesman