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CME swaps reporting unit suffered data breach
From: Erica Absetz <erica () riskbasedsecurity com>
Date: Tue, 23 Apr 2013 15:15:01 -0400
http://www.efinancialnews.com/story/2013-04-23/cme-swaps-reporting-data-breach?mod=sectionheadlines-IB-AM DE Shaw was one of scores of firms affected by the data leak at CME's derivatives data repository, said people familiar with the matter. The hedge fund was notified when CME confessed to the mishap, saying it had temporarily exposed the identity of parties that had traded in derivatives called swaps, the people said. The CME experienced a bug that "permitted a small number of market participants" to see the trades of other participants on Monday April 1, said a spokesman for the Chicago company. About 500 swap transactions tied to agriculture and energy prices out of a total of nearly one million "were mistakenly disclosed," he said. "We regret this incident occurred as maintaining the confidentiality of market participant data at all times is vital to the operation of our markets and systems," he said. CME discovered the hitch when third parties called to clarify why they had access to information that was supposed to be anonymous, said people affected by the breach. The data leak is the latest blow to a real-time transparency mandate for swaps that came into effect in January in the US, but has so far underwhelmed derivatives industry practitioners. Previous to this year, such data had been disclosed only to regulators. Some analysts have said the new price and volume data available for swaps won't give regulators what they need to prevent a financial crisis; others question its usefulness, considering that many traders already pay for pricing tools and consultants. One trader, who spoke on the condition of anonymity, said the data breach was disturbing. "It makes you wonder what else is hanging out there," the person said. Swaps are used by companies, hedge funds and others to protect against price moves in everything from interest rates and bonds to the cost of jet fuel. The new transparency rules took effect in January amid federal efforts to seek better disclosure in the $639 trillion swaps market. The goal of the Commodity Futures Trading Commission, which wrote the rule, was to make the swaps market safer and bring it onto a level playing field with openly reported securities and futures trades. So far the reporting hasn't been perfect; among the hitches are routine delays and non-standardised labelling of positions. But certain data, including parties trading, are not meant to be disclosed because the rule provided for counterparties to be anonymous. Rival providers of swap data repositories include Atlanta exchange and clearinghouse operator IntercontinentalExchange and New York's Depository Trust & Clearing Corp., a utility controlled by major dealers. CME recently agreed to waive fees for its reporting service through September 30 2013. _______________________________________________ Dataloss-discuss Mailing List (dataloss-discuss () datalossdb org) Archived at http://seclists.org/dataloss/ Unsubscribe at http://datalossdb.org/mailing_list Supporters: Risk Based Security (http://www.riskbasedsecurity.com/) Risk Based Security equips organizations with security intelligence, risk management services and on-demand security solutions to establish customized risk-based programs to address information security and compliance challenges. Tenable Network Security (http://www.tenable.com/) Tenable Network Security provides a suite of solutions which unify real-time vulnerability, event and compliance monitoring into a single, role-based, interface for administrators, auditors and risk managers to evaluate, communicate and report needed information for effective decision making and systems management.
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- CME swaps reporting unit suffered data breach Erica Absetz (Apr 23)