Hybrid and remote working models are making surveillance more critical than ever, but implementing a solution is not always easy.
These thoughts came from a recent webinar hosted by Armstrong Wolfe on the importance of trade and communication surveillance in today’s market. Joining the discussion were co-hosts Eventus Systems CEO Travis Schwab and VoxSmart CEO Oliver Blower.
The webinar also explored the opportunities and challenges surrounding the implementation of surveillance systems, such as integrating them with existing workflows and increasing the amount of data captured.
Since the pandemic-induced lockdown, teams within companies have been split. Compliance teams have had to adapt their trade and communication surveillance to handle the new market and their dispersed team.
The webinar claimed that across the capital markets, firms are eager to fully integrate surveillance within other aspects of the business and how solutions can help with this.
While the participants all agreed there was a need for robust surveillance systems, success implementing them were mixed. A common challenge people faced was attempting to get the systems working in unison with other solutions within the overall trading ecosystem.
To ensure a firm can easily slot in a surveillance tool, the webinar expressed the need for a firm to identify a vendor that offers seamless interoperability and will not add to the complications of internal infrastructure.
Interoperability has two sides, technical and commercial. Technical interoperability is focused on APIs and whether the surveillance vendor can extract core pieces of its systems and plug them into areas throughout the business. This model provides greater control of the solutions and enables the company to pick which products they wish to implement.
Commercial interoperability is where vendors partner with one another, share agreements, and offer clients one integrated solution through a single implementation process.
An example of this is the agreement between Eventus and VoxSmart. The companies formed a strategic alliance last year to collaborate and build custom solutions for global market participants looking to enhance their ability to surveil and manage risk across the entire order and trade lifecycle, from pre-trade communications to execution and post-trade monitoring.
Participants also cited inefficiencies that come with implementation as a challenge. One of these is the need for vendors to pass third-party risk assessments. One attendant claimed these processes are sufficiently long and convoluted that the ability to pass a third-party risk assessment is one of their firm’s priorities in evaluating a service provider.
Other obstacles range from interminable POC processes to requirements around disclosing subcontracting relationships.
Another topic covered by the webinar was the use of data and how companies can stop bad actors. Trade surveillance requires an ability to ingest large quantities of data from various datasets, which is powered by automation.
Eventus claims to have poured significant resources into automation to help with this. Clients can use the platform to ensure a wide net of data is captured and machine learning is then used to comb through the alerts generated and identify the most actionable.
The webinar stated that data will be a major area of focus for surveillance providers in the coming years.
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