Trading scandals: The final nail in chat rooms' coffins?

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In both the Libor-rigging scandal and the unfolding foreign exchange-fixing investigations, traders' use of chat rooms to exchange gossip, insults and market-moving tidbits seems to have played a key role.

Transcripts from instant messages between traders have played an important part in bringing them in front of formal investigations and into court.

Now that some of the world's biggest banks, including JPMorgan Chase and Credit Suisse are discussing banning traders from chat rooms, could this mark a return to the days where most business was conducted over the phone – or even over lunch?

(Read more: What traders have in common with baboons)

The incriminating conversations discovered by investigators in the Libor and currency trading probes were mostly conducted via Bloomberg terminals, an almost ubiquitous presence on trading floors around the world. The terminals provide financial data, news headlines and access to chat with traders within the same bank and on other trading floors. Around 200 million email messages and 15 million-20 million chats are carried out via Bloomberg terminals every day.

Trading scandals: The final nail in chat rooms' coffins?
Trading scandals: The final nail in chat rooms' coffins?

"Regulators are now trying to regulate something which has been around 10-15 years," Joe Rundle, head of trading at ETX Capital, pointed out.

"It will probably have to be a lot more formal in future – but it would be very hard to break the cycle as traders use the terminals so much."

(Read more: The 'Wild West' forex market)

There are also many chat rooms – including those on social networks Twitter and Facebook -- used by day traders, who are often working from home.

For the big banks, the most likely conclusion is tighter monitoring of chat rooms, and more focus on business-only conversations, according to Rundle, rather than the kind of looser, friendly talk which led to cringeworthy observations like the Icap broker who promised a Libor-setting colleague "a Ferrari". They may also consider confining chat rooms to internal users.

Earlier this year, concerns were raised when it emerged that journalists from Bloomberg's news service had monitored its chat rooms and gained access to client data through its terminals. Between 15 million-20 million chats happen everyday across Bloomberg terminals.

(Read more: Business lessons from the Bloomberg terminal scandal)

The media company has since launched an internal investigation which found that there had been one instance of a journalist using sensitive client data in a news story. However, there was more evidence of journalists monitoring conversations in chatrooms for story ideas, which highlighted data protection issues.

Bloomberg has appointed two new senior editors to reinforce rules following the furore. The company declined to comment.

(Read more: Bloomberg supervision boosted after terminals scandal)

By CNBC's Catherine Boyle. Twitter: @cboylecnbc.

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