The client offers a fully automated all-in-one compliance platform for the global investments industry. They serve financial services providers with automated compliance solutions that enable regulatory protection, reduced risks, and brings down the operating costs. They aim to deliver thorough, unparalleled expertise in risk and compliance experiences to their customers.
Need to align trading compliance with regulatory mandates
Insider trading has been an impending problem for the global financial industry since the inception of stocks. In the times when we live in fluctuating economic environment, investors and traders might be lured to abuse financial information not known to public and perform insider trading. The information can range from a new product launch, a merger with another company, change of CEO, or exemplary financial reports – any piece of information that could send an organization’s stock price higher or lower. Such activities can bring bad name to a financial organization and potentially disrupt the reputation and goodwill built over several years of work.
The client had been trying to ensure that a culture of internal compliance prevails throughout their organization, while successfully meeting stringent regulatory expectations. They wanted to clearly set mandates for intensified compliance initiatives to constantly monitor trading activities of employees as well as their clients.
The company wanted a solution that could generate meaningful alerts and enable efficient investigation and analysis.
The implementation should streamline the current surveillance and reporting of relevant information to serve as a cornerstone of their financial compliance strategy.
- Need for a solution to include proactive view of employee and client trades: By automatically gathering and sorting contextual information around trades, the client wanted the solution to catch insider trade that may otherwise slip through the cracks.
- Quick insider trading detection: The client wanted a solution that could identify and flag a suspicious pattern of a trade with respect to before-trade and after-trade news in the financial market.
- Reduce time and risks: The client wanted a comprehensive solution that could remarkably reduce time and risks by efficiently consolidating trade events and market news on a single platform.
Comprehensive compliance system tailored to reduce risks and ensure compliance
The client spelled out their expectations to have an end-to-end solution that leverages robust data model with elaborative dashboard capabilities. The solution needed to provide a roadmap to a more holistic, integrated compliance platform. As a strategic technology advisor, Persistent re-engineered and re-platformed the compliance system, which is now easy-to-use, scalable, dynamic and operates at reduced costs. The solution provides a comprehensive, transparent view of all employee and client trades.
Advanced solution to detect insider trades: The solution leverages a list of suspicious trading behavior scenarios to help compliance officer to monitor activities and detect trades that can eventually cause non-compliance. The solution automatically matches market data and company news vs. trades in employee or company managed portfolios, or both, and smart alerting algorithms alerts the compliance officer if a trade has occurred prior to or right after a market moving issuer event. The purpose of the solution is to detect misuse of nonpublic information.
Reduced time and risk: The automated solution serves as a broad, holistic, and integrated compliance platform that helps users achieve a complete, transparent view of their employees’ and clients’ trades and reduces cost of insider trading detection within their complete all-in-one compliance platform.
The delivered solution’s sophisticated events and pattern recognition techniques is helping the client and their patrons accurately identify illegal insider trading activities that surges non-compliance and reputational risks.
Solution highlights
- Event based pre-built scenarios and detection techniques
- Adaptability to changing regulatory mandates
- Extensive monitoring of potential insider trading
- Provide proactive view of all employees’ and clients’ trading activities
