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IBM and Mantas partner to address mutual fund abuses

05 February 2004  |  1455 views  |  0

Mantas Inc., the leading provider of compliance solutions for the financial services and telecommunications industries, and IBM, the world's largest information technology (IT) company and provider of IT services, have agreed to jointly market and support compliance technology and services to help detect and address trading abuse at mutual funds. IBM and Mantas will offer the mutual fund industry a set of solutions to help them meet regulatory requirements.

The companies will focus initially on a combined technology and services solution that addresses the recent mutual fund scandals involving trading abuse including late trading market timing, self-dealing and breakpoint violations.

"This new solution will offer insight into trading activities leading to the restoration of trust and reliability at affected fund companies and brokerages," said June Felix, General Manager of Risk and Compliance for IBM. "This will augment the success already evident in other branches of the financial services industry where our clients have implemented enterprise-wide solutions to satisfy a wide range of compliance needs."

In addition to mutual fund solutions, Mantas and IBM are adapting technology and services to help all major financial markets providers comply with the latest regulations governing money laundering, fraud detection, trading compliance and broker surveillance.

"A large percentage of the abuses leading to damaged reputations and investor losses would have been detected by appropriate use of available technology and more aggressive compliance monitoring," said Simon Moss, CEO, Mantas. "Although this technology becomes more sophisticated by the day, it has been employed for many years by institutions and exchanges."

The partnership allows clients to deploy the same technology by leveraging existing IBM systems to integrate Mantas compliance solutions.

For example, one of the world's largest financial institutions recently selected IBM and Mantas for the global rollout of an AML solution that links several hundred branch offices and related facilities.

"Clearly it's time for a thorough review of how regulators and the industry harness technology to detect and deter abusive and illegal behaviors," said Nancy Smith, securities consultant to Mantas and former SEC regulator. "Advanced technologies may very well result in the better enforcement of existing rules and limit the need to adopt reforms that lead to more complex and costly rules."

Areas of collaboration between IBM and Mantas cover products such as: Anti-Money Laundering; Broker Surveillance; Trading Compliance; Fraud Detection; Best Execution Agent; and Customer Suitability Agent.

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