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Banks Europe Fintech

Siloed Systems Are Compromising Market and Trade Surveillance

Siloed teams managing disjointed technology systems is compromising market integrity and trade surveillance; according to the latest data from VoxSmart.

As highlighted in its recent poll, VoxSmart found how having numerous technology systems scattered across the business acts as the biggest obstacle to financial institutions achieving strong market and trade surveillance.

A poll of 79 market participants, including investment banks, brokers, and investment managers, found that 69 per cent of firms believe having siloed surveillance systems increases the risk of market abuse being carried out. 18 per cent of respondents said that replacing legacy systems was a barrier, while only 13 per cent claimed tracking trader chat through multiple channels, such as WhatsApp and Telegram, would prove to be barriers to stronger surveillance.

The impact of siloed teams was an area that was heavily discussed throughout our coverage of cybersecurity, including how such a set-up could potentially hinder business operations and online safety.

The findings come as the potential for market abuse continues to accelerate globally as financial institutions continue to adjust to the new hybrid working world. Figures from Refinitiv show that just under six per cent of suspicious transactions set off alerts among investors last year.

Oliver Blower, CEO of VoxSmart
Oliver Blower

Commenting on the findings, Oliver Blower, CEO of VoxSmart, said: “For years, financial institutions have been reliant on multiple disparate vendor solutions to detect any potential cases of market abuse. The trouble is that this has not been effective and the risk of sensitive or misleading information being overlooked remains extremely high.

“These days, surveillance is looked at on an individual conduct risk assessment basis – which means that very few areas of the business, if any, are out of bounds. Working towards a smarter way to monitor trade, markets, and comms data on one single platform so that there is more visibility into all activity cross-firm and cross-department, has to be the way forward.”

Author

  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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