Russian regulator clamps down on market abuse

Source: Nice Actimize

NICE Actimize, a NICE Systems (NASDAQ:NICE) company and the largest and broadest provider of a single financial crime, risk and compliance software platform for the financial services industry, today announced that the federal executive body regulating the Russian Federation's financial markets, Federal Financial Markets Service (FFMS), has deployed NICE Actimize's solution for market surveillance.

The FFMS has already uncovered suspect activity from its implementation of the Actimize Market Surveillance solution, which includes compliance monitoring for equity, fixed income, futures and other securities and trading products.

The FFMS currently monitors tens of millions of orders daily from the two primary Russian exchanges, the Moscow Interbank Currency Exchange (MICEX) and the Russian Trading System (RTS), involving some one million executions. The FFMS sought the Actimize Market Surveillance solution in its efforts to enforce a new Russian Federal Law that is expected to go into effect January 2011:"On Counteracting the Abuse of Inside Information and Market Manipulation and Amendment of Certain Legislative Acts of the Russian Federation." This new law seeks to enable the FFMS to enact new regulations and is intended to reinforce market integrity and transparency in Russian financial markets.

Working alongside implementation partners FUN, one of the largest systems integrators in Russia, and Prognoz, a BI applications provider, NICE Actimize was able to execute the project very quickly. The implementation commenced at the beginning of July and the solution went live within a span of just ten weeks.

"We are determined to ensure fair trading practices and prevent market abuse. Sophisticated abuse patterns require sophisticated compliance measures," said Mr. Milovidov, Head of the FFMS. "We conducted a rigorous search with stringent criteria before choosing NICE Actimize for the automation of our regulatory compliance initiatives. In the two weeks since going live with the solution, we have already identified three potential wash trade cases that we are currently investigating."

NICE Actimize's market surveillance solutions are used by the largest European and American financial institutions and regulators to increase their insight into suspicious behaviour and improve risk and compliance management. While some regulators, securities firms and investment banks still rely on manual or semi-automated processes to monitor compliance with market abuse regulations, automation such as that provided by NICE Actimize can radically improve the identification and reporting of suspicious transactions. Leveraging proven detection models with sophisticated analytics to assign priority scores to alerts, the solutions delivers strong surveillance capabilities and improves efficiency for regulators, trading managers and compliance staff.

"We are pleased that the FFMS has joined our growing list of regulators across the globe that are leveraging our technology in their efforts to detect noncompliant activities. By automating the detection and prevention of market abuse, the FFMS and the Russian Federation have established themselves as industry leaders," said Amir Orad, president and chief executive officer of NICE Actimize. "Russian regulations and penalties are expected to continue to proliferate, and proven, powerful, and flexible tools must be in place to ensure a meaningful impact for the myriad of traders who are committed to fair trading practices."

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