Source: The Canadian Press

Industry Minister Tony Clement has called for a probe of Statistics Canada procedures after a report that paying clients got up to a 59-second head start on market-moving data.

“If the report is true, it would be a disturbing situation,” Clement told reporters Tuesday. “I directed officials immediately to look into the situation, to give me the facts.”

Earlier Bloomberg, one of the agency’s 10 paying clients, reported Statistics Canada had stopped the practice on Nov. 25 after the news service informed the federal agency that it could access data in advance of the official release

A StatsCan spokesman blamed the problem on a programming glitch and said a preliminary inquiry has determined three of its secondary distributors had the ability to access the data in advance.

“There was the possibility that a secondary distributor could get the data as much as 59 seconds before release time,” said Claude Graziadei, Statistics Canada’s director of communication.

“As soon as we discovered that, we had the programming on the systems changed … and essentially we’ve plugged the hole.”

Besides Bloomberg, paying distributors are the Conference Board of Canada, EcoWin AB, Emerging Markets Economic Data Ltd., FactSet Research Systems Inc., IHS Global Insight (Canada), Haver Analytics, Moody’s Economy.Com, Nomura Research Institute Ltd. and Thomson Financial Investment Management Group.

Graziadei said officials are going through their records to determine when the three distributors actually downloaded the data.

He said he does not know whether any of the clients profited from an early release of the data, although he added it would be difficult to determine whether the data was misused.

“We want to assess the extent of the situation because we were completely unaware this was happening.”

A few seconds would have been plenty of time for a currency trader to make money on the information, said NDP finance critic Thomas Mulcair.

“Canada’s currency is one of the most traded in the world. If you know even the slightest bit more information than the next person, you can make a fortune trading large sums of money. And that appears to be what’s happening now,” he said.

The most market-moving report issued by Statistics Canada is the monthly employment data, which is made public at 7 a.m. sharp the first Friday of each month.

But statistical reports on inflation, gross domestic product, manufacturing and export data also can be useful to currency traders.

Last year, the agency clamped down on security after the Canadian dollar rose sharply by half a cent about 50 minutes before release of the employment report, while reporters were in a lock-up.

Subsequently, the agency drew the blinds in the lock-up room, ostensibly to prevent visual signals, placed an additional monitor in the room and required that cellphones and other wireless devices be stored outside.

The agency’s investigation of the incident found no evidence of a leak, however.

On it’s website, the agency says it gives key federal officials advanced access on a “small number of economic statistics” the afternoon before their release.

Mulcair said the lapse is another indication of the Conservative government lax security, suggesting party “cronies” are being favoured.

He cited the recent release of a confidential committee report to Conservative lobbyists by a staffer to MP Kelly Block, and suspicions that a leak tipped off some investors that Ottawa would reject the controversial Taseko Mine in British Columbia.

Clement said he was taking the situation seriously, but at this time did not know the extent of the breach, or if there had been one.

“My pledge to the people of Canada is that StatsCan should act in a fair manner, a transparent manner, an accountable manner and that obviously we’ll have to make some changes,” Clement said.

Although the agency knew of the problem on Nov. 25, Clement said the first time he heard of it was when the Bloomberg story came out Tuesday.