How artificial intelligence (AI) software helped find the link between these playing cards and insider trading
SAN FRANCISCO, CNN said on the morning of the 28th, March 2017, several trading nights in 2013, trading executives from several major investment banks came together to play cards, apparently to be temporarily relieved from the busy work. But beneath these seemingly innocent hands, the hidden story is the insider trading between several rogue traders.
The profit and loss statements of these traders fluctuate dramatically after each deal because they are using the poker board to conspire with each other to provide insider information about the deal.
Start of the game
The scam was not discovered until 2015 when the companies where the traders were located were investigated by the authorities. A law firm was hired to inspect the suspicious activities of these companies but failed to get along with the hefty pile of correspondence.
Finally, artificial intelligence (AI) software helped find the link between these playing cards and insider trading. The software was developed by British startup Behavox, whose software ties seemingly unrelated events and helps irregularities in financial institutions to identify rogue traders by compliance officers inside financial institutions.
Behavox – Thinking software
Erkin Adylov, Behavox’s chief executive, told CNBC: “If you do not know where to look for suspicious things, then a poker hand will never be on your guard.”
“The relationship between the players who participated in the game is the cause for our concern, three of whom are very close and seem to have a business relationship, these guys still spend a lot of time playing poker in clear and busy conditions As a matter of fact, we suspect that when you analyze their income statements and cover them with one data set, you can find that the income statement fluctuates significantly after each lot, and when we remind them of this, the compliance officer It is possible to relate these situations and find that it is a conspiracy case. ”
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This case is just one of many interesting cases that Behavox’s software has helped find. In another case, the traders involved used a menu from the British chain of roast chicken shops Nando’s to hide the illegal trading activity but were also caught up in Behavox’s software.
New technology filled the gap
This should be a solution that has been welcomed by many large companies, and the global banking industry has been suspected in tens of billions of dollars for various violations in the past few years. In the UK, senior executives may face jail time if their employees make the wrong decision that led to bank failures.
So far, hedge fund Marshall Wace and trader-broker TP ICAP have chosen to use Behavox’s software. Adylov said the company currently has 15 customers, and hope that this figure will increase significantly this year. He declined to reveal the current valuation of the company, which was only two and a half years old, but claimed to have received over $ 100 million in takeovers.