mercredi 8 avril 2015
JPMorgan Algorithm Knows Youre a Rogue Employee Before You Do
Posted on 06:38 by nice news
Wall Street traders are already threatened by computers that can do their jobs faster and cheaper. Now the humans of finance have something else to worry about: Algorithms that make sure they behave.
JPMorgan Chase & Co., which has racked up more than $36 billion in legal bills since the financial crisis, is rolling out a program to identify rogue employees before they go astray, according to Sally Dewar, head of regulatory affairs for Europe, whos overseeing the effort. Dozens of inputs, including whether workers skip compliance classes, violate personal trading rules or breach market-risk limits, will be fed into the software.
Its very difficult for a business head to take what could be hundreds of data points and start to draw any themes about a particular desk or trader, Dewar, 46, said last month in an interview. The idea is to refine those data points to help predict patterns of behavior.JPMorgans surveillance program, which is being tested in the trading business and will spread throughout the global investment-banking and asset-management divisions by 2016, offers a glimpse into Wall Streets future. An industry reeling from billions of dollars in fines for the actions of employees who rigged markets, cheated clients and aided criminals is turning to technology to police itself better. Failure to do so will provide ammunition for those pushing to separate trading operations from retail banks.
Surveillance Unit
At New York-based JPMorgan, the worlds biggest investment bank by revenue, the push comes after government probes into fraudulent mortgage-bond sales, the $6.2 billion London Whale trading loss, services provided to Ponzi-scheme operator Bernard Madoff and the rigging of currency and energy markets.
The company has hired 2,500 compliance workers and spent $730 million over the past three years to improve operations. Job postings show it is building a surveillance unit to
JPMorgan Chase & Co., which has racked up more than $36 billion in legal bills since the financial crisis, is rolling out a program to identify rogue employees before they go astray, according to Sally Dewar, head of regulatory affairs for Europe, whos overseeing the effort. Dozens of inputs, including whether workers skip compliance classes, violate personal trading rules or breach market-risk limits, will be fed into the software.
Its very difficult for a business head to take what could be hundreds of data points and start to draw any themes about a particular desk or trader, Dewar, 46, said last month in an interview. The idea is to refine those data points to help predict patterns of behavior.JPMorgans surveillance program, which is being tested in the trading business and will spread throughout the global investment-banking and asset-management divisions by 2016, offers a glimpse into Wall Streets future. An industry reeling from billions of dollars in fines for the actions of employees who rigged markets, cheated clients and aided criminals is turning to technology to police itself better. Failure to do so will provide ammunition for those pushing to separate trading operations from retail banks.
Surveillance Unit
At New York-based JPMorgan, the worlds biggest investment bank by revenue, the push comes after government probes into fraudulent mortgage-bond sales, the $6.2 billion London Whale trading loss, services provided to Ponzi-scheme operator Bernard Madoff and the rigging of currency and energy markets.
The company has hired 2,500 compliance workers and spent $730 million over the past three years to improve operations. Job postings show it is building a surveillance unit to
JPMorgan Algorithm Knows Youre a Rogue Employee Before You Do
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