AI-powered surveillance for financial markets and transactions

Cristina Soviany
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Cristina Soviany: Feature Analytics, Belgium

Journal of Digital Banking, 2019, vol. 3, issue 4, 319-329

Abstract: The paper presents an overview of financial markets surveillance solutions for the detection of various abusive behaviours. Technological advances support high-performance artificial intelligence (AI)-based solutions that help to avoid the drawbacks of legacy solutions. Many AI-based technologies are applied to detect sophisticated fraudulent actions on financial markets. A good approach is outlier or anomaly detection looking for observations that are inconsistent with remainder of the available data. Among the new technologies available are eyeDES, a cutting-edge AI-based technology and platform whose functional components provide market intelligence and unbiased detection of market abuse. It allows the detection of both previously known and completely new abusive behaviours in real time, effectively combining the use of advanced data analytics to enrich the original data space with new Features and anomaly detection to find inconsistent cases. Each case is provided with a score that measures how different that market participant’s activity is from the others, and a number of possible explanations for this. eyeDES is based on a solid and robust reasoning process, and it is an explainable AI technology, because it provides explanations of the rationale behind the decisions.

Keywords: Artificial Intelligence; surveillance solutions; market abuse detection; anomaly detection; explainable AI (search for similar items in EconPapers)
JEL-codes: E5 G2 (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:aza:jdb000:y:2019:v:3:i:4:p:319-329

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