Thomson Reuters will no longer distribute a closely-watched consumer confidence survey produced by the University of Michigan after Decembe, according to a report by the Wall Street Journal.
The university announced this week it had inked a deal with Thomson Reuters rival Bloomberg LP to distribute the results of the survey in news stories at the same time the data is released online.
The deal comes after a former Thomson Reuters employee accused the company of violating insider trading laws by releasing the data early to paying clients.
Under the scheme, Thomson Reuters was said to have distributed the results of the consumer confidence survey to paying clients a full five minutes before the results were published by the university online. The company also made the results available a full two seconds earlier to clients who paid an additional $5,000 monthly fee.
Mark Rosenblum, a Thomson Reuters data analyst, contacted FBI agents concerned that the practice violated financial law. The company fired Rosenblum after the Securities and Exchange Commission (SEC) launched an investigation into the practice.
Rosenblum sued the company, alleging Thomson Reuters launched a “discriminatory crusade” into his employment after he blew the whistle on the scheme. The company denied Rosenblum’s allegations in court filings, saying the former employee had no basis for his claims. The two sides settled the case out of court this summer; details of the settlement were not disclosed.
Though regulators found Thomson Reuters to be within the law, the practice still drew scrutiny from Wall Street and law enforcement. Eric Schneiderman, a New York attorney general who investigated the company, likened the practice to “Insider Trading 2.0.”
The practice of releasing the data early to clients will end under the five-year deal signed between the university and Bloomberg this week. Starting in January, results from the consumer confidence survey will move in a series of stores by Bloomberg at the same time the results are published online by the university.
“This agreement ensures that we will be able to maintain the high quality of these surveys for the foreseeable future, and supports our strong commitment to open access to research data,” university official James Jackson told the Wall Street Journal.
The survey has been conducted by the University of Michigan since the mid-1940s. The results of the survey are closely monitored by economists as an indicator of potential U.S. household spending.
Wall Street Journal: Thomson Reuters loses consumer survey results to Bloomberg