Bank of England three times passed press conference scandal company
The Bank of England scrutinised a company three times before it was subsequently found to have provided early access to the Bank’s press conferences to paying clients.
Threadneedle Street carried out diligence on Encoded Media three times between 2008 – when it first hired the firm as a technology partner – and 2019.
Encoded’s status as a technology supplier was ended by the Bank after the Times revealed that a “third party” had been providing an audio stream of a back-up the main video feed of press conferences, the Guardian reported today.
Such an arrangement allowed traders to hear governor Mark Carney’s words before others, giving them a potentially lucrative advantage in a financial world where speed is key.
The Bank of England has not itself named any firms, but said in December it “immediately disabled” the access of a third-party supplier and called the early streaming of audio was “wholly unacceptable”.
It is not currently clear that Encoded Media broke any laws, however, raising potentially embarrassing questions for the Bank over the system that is thought to have benefited certain hedge funds and traders. Encoded and related entities have denied wrongdoing.
Outgoing governor Carney and his replacement Andrew Bailey can expect a grilling from MPs this week when they go in front of parliament’s Treasury Select Committee.
Chair-elect of the TSC Mel Stride has said he expects the committee to ask “searching questions” of the Bank bosses.
The Financial Conduct Authority (FCA) is currently looking in to the scandal surrounding early access to the BoE’s press conferences.
The Bank of England declined to comment. Encoded Media could not be reached.