Market Abuse and Insider Trading Prevention

IDENTIFY TRADING BEHAVIOR

Market Manipulation and Insider Trading Detection

Trading in financial instruments is subject to strict regulations – and banks and financial service providers are responsible for detecting market manipulation and insider dealing at an early stage. ACTICO supports this task with its software solution MAID (Market and Insider Dealing Detection).

MAID monitors securities transactions carried out by customers, employees, or a bank’s proprietary trading desk for signs of market manipulation, regulatory breaches, or insider dealing. The monitoring scenarios can be tailored to the specific requirements of each institution. Automated monitoring triggers the necessary clarification and investigation processes.

Key Features

Monitoring Securities Trading for Market Manipulation and Insider Trading

Monitoring Using Standard Scenarios

The automatic monitoring checks the securities orders against scenarios that indicate market abuse, breaches of rules or insider trading. It monitors orders from customers, employees and from proprietary trading. Transactions with third-party banks are included. The checks consider the underlying of complex financial instruments.

Support clarifications

The trade surveillance software supports clarification with comprehensive case management and workflows. It triggers a clarification if it recognizes suspicious behavior patterns during its daily tracking of securities trading.

Market manipulation scenarios

The software triggers a clarification if conspicuous scenarios such as wash trades or improper matched orders occur.

Digitisation when checking staff’s private share deals

The German Securities Trading Act obliges banks to record their staff’s third-party bank transactions. Manually inputting a duplicate takes several minutes. Automatic scanning, data mapping, and plausibility checks reduce the manual work time by up to 90%.

Insider trading scenarios

ACTICO’s trade surveillance software triggers a clarification if it detects unusual transactions or behavior patterns such as front or parallel running during its daily tracking of securities trading.

Managing insider lists

The software solution keeps insider lists up to date. The entries are recorded with reference to securities or companies and checked against the securities orders. Incidents of insider trading are automatically detected.

Restricted lists, watchlists

The software makes it easy to maintain restricted and watch lists. It continuously checks securities orders and transactions against these lists.

Third-Party bank transactions

Employee transactions and deposits with third-party banks are recorded in the system by the compliance department or the employee and automatically checked as part of daily monitoring. The employee uses the system to submit a declaration of completeness for the reports.

Pre-Clearance

A pre-clearance function is available for the pre-approval of a stock exchange order. Employees of financial institutions can use this to obtain approval before executing a securities transaction.

Regulatory coverage

ACTICO MAID was developed in accordance with the Market Abuse Regulation (MAR) and the Market Abuse Directive (MAD II) of the EU/EEA, the technical implementing standards of ESMA and the circular of FINMA (Switzerland) on market conduct rules.

Benefits

Flexible and adjustable
The software can be adapted to suit your specific requirements.

Total Compliance
ACTICO helps financial institutions implement and comply with regulatory requirements in securities trading as stipulated in relevant legislation, including MAD II/MAR.

The ACTICO Approach

Digital monitoring to identify trading behaviour that may prompt regulatory inquiries

ACTICO Compliance Software is delivered with basic scenarios in which transaction data is checked against rules. Once an anomaly occurs, the system generates an alert for the compliance officer and initiates a workflow for further processing of these “hits.” Rules can be customized in the software to meet the requirements of the financial institution and take effect immediately upon changes.

ACTICO Compliance Software represents a the comprehensive software family for Compliance & Financial Crime Management in banks and insurance companies.

Learn more

„Aside from compliance with the legal requirements in relation to market abuse, we were particularly interested in using software that would enable us to be proactive as opposed to just reacting to events. After all, what could be worse for a bank than to lose its good name due to malpractice.”

Stefanie Giger

Compliance Officer, LGT Bank

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