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IBM Watson Now Being Used To Catch Rogue Traders (siliconrepublic.com)

Posted by ryuzaki0 on from the power-of-ai dept.

IBM is piloting its Jeopardy-winning Watson technology as a tool for catching rogue traders at large financial institutions, executives said in an interview Monday. From a report: Referred to as Watson Financial Services, the new product will become a monitoring tool within companies to search through every trader's emails and chats, combining it with the trading data on the floor. The objective? To see if there are any correlations between suspicious conversations online and activity that could be construed as rogue trading.

33 of 60 comments (clear)

  1. Re:Who's that? by Tablizer · · Score: 1

    And you can have all my base while you are at it.

    --
    Table-ized A.I.
  2. Do the Emails belong to company? by charliemerritt03 · · Score: 1

    Do the Emails belong to company? If so I see no problem with this. If this becomes common practice then company Email won't used in the future. But if they can catch crooked traders NOW for past deeds...

    1. Re:Do the Emails belong to company? by networkBoy · · Score: 2

      Of course they do, anything you do on your employer's network (including this /. post) is legally inspectable by your employer.

      Anything I don't want my employer to know isn't done on their network. If I was a rogue trader and colluding with others you better believe we'd all have burner phones and using something out of band.

      --
      whois gawk date unzip strip find touch finger mount join nice man top fsck grep eject more yes exit umount sleep dump
  3. Hay WATSON, Difference Between A Pig and A Hog? by LifesABeach · · Score: 1

    One of'em goes to market.

  4. Misleading Title! by sciengin · · Score: 3, Funny

    This is false advertising: Watson is not used at all to find old and rare edition of Games Workshop's "Rogue Trader"!
    Classic example of fake news.

    1. Re:Misleading Title! by phantomfive · · Score: 2

      And that's totally true: Watson was a program built to play Jeopardy, but now has become a blanket marketing term for many products inside IBM, some of which have nothing to do with AI at all. So who knows what they are even doing there. Some kind of data mining, but other than that........

      --
      "First they came for the slanderers and i said nothing."
    2. Re:Misleading Title! by Anonymous Coward · · Score: 1

      +1 true. Right after the Jeopardy event, some key members left and very little of the technology was commercialized. What's often called Watson is a series of rebranded IBM and open source projects. Watson for Machine Learning (or whatever they call it) is just a hosted version of Apache Spark. It used to be SAS.

      Some of the NLP technology was open sourced and available in Apache UIMA. However, UIMA is just a framework for managing NLP projects. Any NLP or machine learning break throughs were kept under lock and key. Same goes for the trained models.

      It's a shame, but the Watson family of products peddled by IBM has absolutely nothing to do with Jeopardy Watson.

  5. Finding Patterns in Crime by WDot · · Score: 4, Insightful

    I recently listened to a talk by a Dr. Jeremy Pickens talking about this problem (I'm not his student or employee or associated with him). He argued that this is actually a tough problem to solve because there aren't obvious patterns in criminal activity. Sometimes they use code words, but the code words are different for every criminal. Sometimes they have suspicious conversations after hours, but not always. The people involved in the LIBOR scandal talked openly about their cheating, during work hours. There wasn't anything "unusual" about it to a statistical model, but it was brazen to a human investigator!

    1. Re:Finding Patterns in Crime by DickBreath · · Score: 1

      The criminal traders will simply find different ways to communicate which are not monitored.

      --

      I'll see your senator, and I'll raise you two judges.
    2. Re:Finding Patterns in Crime by Tablizer · · Score: 1

      there aren't obvious patterns in criminal activity. Sometimes they use code words, but the code words are different for every criminal.

      I heavily used code-words at one place simply because the office politics were so intense that little things created drama storms.

      Bob: "How's the hopper rider and the green peas?"

      Me: "Oh, the Flanagan popped a rabbit, which agitated the mountaineer again."

      Bob: "Yeah, their fiddle-sticks pack a punch. Good thing the Flux Whopper can plug the hole, otherwise Mr. Owl's tree branch would hang the cheese and us with it."

      Me: "I know what you mean. Hammerheadding almost always beats painted planetariums."

      Bob: "At least Spiderman didn't frisk the Joker's tentacle."

      Me: "Indeed, I hate it when that happens. Take care, see ya tomorrow."

      Bob: "Sure, don't let the plaid horse-bugs bite."

      People thought we were on LSD, but at least we avoided trouble.

      --
      Table-ized A.I.
    3. Re:Finding Patterns in Crime by ark1 · · Score: 2

      This is precisely what these organization want. It is a way to turn your head the other way. "Look we know in order to remain competitive, rules have to be bent but we would prefer if you don't leave a trace within our infrastructure".

    4. Re:Finding Patterns in Crime by anonymous+cupboard · · Score: 1

      At the moment, everything to or from a trader is recorded whether Emails or Voice. Nobody goes near it unless there is an official enquiry or funny price patterns are observed. So a "Can you nudge it a bit up" may be obvious when talking about interest rates and if a human listens in. Currently, without full language recognition and some very clever analysis is that can be done is to look at whether prices seem "wrong" when compared with other data.

  6. Re:Is this legal? by jbmartin6 · · Score: 1

    Why? All of this is already being done by other processes, such as manual review and other forms of automation.

    --
    This posting is provided 'AS IS' without warranty of any kind, implied or otherwise.
  7. Shouldn't be too hard to catch... by __aaclcg7560 · · Score: 1

    Rogue traders do it from behind.

    1. Re: Shouldn't be too hard to catch... by __aaclcg7560 · · Score: 1

      What the hell are you talking about?

      Uh, seriously? Turn in your geek creds and don't let the door hit your ass on the way out.

      http://cdn.shopify.com/s/files/1/0879/1412/products/rogue-hoodie-red.jpeg?v=1453674518

    2. Re: Shouldn't be too hard to catch... by __aaclcg7560 · · Score: 1

      That still doesn't explain what you're talking about. I assume it's some kind of dice game?

      Kids these days...

      The rogue or thief is one of the standard playable character classes in most editions of the Dungeons & Dragons fantasy role-playing game. A rogue is a versatile character, capable of sneaky combat and nimble tricks. The rogue is stealthy and dextrous, and in 2nd edition was the only official base class from the Player's Handbook capable of finding and disarming many traps and picking locks. The rogue also has the ability to "sneak attack" ("backstab" in previous editions) enemies who are caught off-guard or taken by surprise, inflicting extra damage.

      https://en.wikipedia.org/wiki/Rogue_(Dungeons_%26_Dragons)

    3. Re: Shouldn't be too hard to catch... by __aaclcg7560 · · Score: 1

      I thank the Emperor that the good people at the Inquisitorial Board of Malfeasance is finally doing something about this filth, what with their bartering with foul xenos.

      I didn't think "Mission Earth" by L. Ron Hubbard was that bad. ;)

  8. Re:Who's that? by Anonymous Coward · · Score: 1

    I'm a sysadmin, I read all your emails anyway.

    You really should reply to your mom

  9. Helpful insights. by Futurepower(R) · · Score: 1

    Interesting.

    One answer to a corrupt financial system is to have better, more complete laws, and follow them.

  10. Re:Is this legal? by frank_adrian314159 · · Score: 2

    You answered your own question. You can get rid of the manual review. Plus, if you can just point a big-ass data stream at Watson and it can actually ferret out malfeasance, you can also get rid of the folks who program those "other forms of automation".

    Instead, you'll be replacing them with a smaller number of people who can choose training sets and interpret Watson's output. You'll also see savings in your programming costs, as you've replaced several fraud detection systems with a single, unified system. So you get a smaller workforce.

    You also get a more bifurcated workforce, with a small number of jobs being up-skilled (and more-highly paid), while a larger number of jobs are down-skilled or eliminated altogether. Whether this works when translated to a large portion of the white-collar, service-sector workforce as a whole is left as an exercise to the reader.

    --
    That is all.
  11. What's the difference? by rmdingler · · Score: 3, Funny

    Allowing, nay, encouraging, surveillance by artificial intelligence to nab the evil high volume stock traders would never be misused against a general public eager to see the practice implemented.

    --
    Happiness in intelligent people is the rarest thing I know.

    Ernest Hemingway

  12. That can't be the real motive by Baron_Yam · · Score: 1

    It's too easy to circumvent - use private email, pass notes, take a break and talk outside, etc.

    It seems more likely that they're using this project as an opportunity for tuning Watson so it can be developed as a replacement for your average stock analyst.

    1. Re:That can't be the real motive by networkBoy · · Score: 1

      It's too easy to circumvent - use private email [from a cellular network connection], pass notes, take a break and talk outside, etc.

      It seems more likely that they're using this project as an opportunity for tuning Watson so it can be developed as a replacement for your average stock analyst.

      FTFY

      --
      whois gawk date unzip strip find touch finger mount join nice man top fsck grep eject more yes exit umount sleep dump
    2. Re:That can't be the real motive by Actually,+I+do+RTFA · · Score: 1

      tuning Watson so it can be developed as a replacement for your average stock analyst.

      Why would they take the step backwards. After all, a PRNG does better than the average analyst.

      --
      Your ad here. Ask me how!
  13. Re:Is this legal? by Anonymous Coward · · Score: 1

    Cracker Jack just called and asked for the law "degree" you got from them back. The corporations own the emails their employee's produce. If the corporation hires IBM to do this, what is not legal about it?

  14. Unemployable by MouseR · · Score: 1

    That bit pusher can't hold a job.

    It'll end as a burger flipper.

  15. NSA Watson by thesjaakspoiler · · Score: 1

    Not sure if there aint a better purpose for an AI machine else then playing jeapordy and being the next NSA tool. But that exactly points out what it can't do. Watson would be more valuable if it could do the trading but I guess that is just a pipedream.

  16. Point Watson at Congress by Snotnose · · Score: 1

    Let the AI root out the rogue assholes. Ok, I know all of them are corrupt assholes, but Watson could connect the dots to let a good third of them end up in jail.

    1. Re:Point Watson at Congress by Baron_Yam · · Score: 2

      They are the very definition of 'middle-men'. They are the gatekeepers because they're the gatekeepers, not because they're adding value.

      Because if they really were adding value, they'd simply enrich themselves with their knowledge instead of hedging their bets by taking a commission off of others.

      They're glorified shamans and bookies, offering betting advice based on sheep entrails. But they get lots of coke and hookers, so they have that going for them.

  17. Re:Missed A Few by Enigma2175 · · Score: 1

    WATSON also needs to have access to the communication of political leaders to avoid their insider trading related to political decision making.

    You're hilarious. Do you actually expect that politicians have to follow the same rules as you? Congress and the President are exempt from insider trading laws. They make the laws and there is a shitload of money to be made so they just exempted themselves. Because fuck you, that's why.

    --

    Enigma

  18. Rogue Traders by Chris+Mattern · · Score: 1

    They aren't going to worry about this. After all, they already have an Imperial Warrant.

  19. Rogue traders? by cyberchondriac · · Score: 3, Interesting

    Can it catch Paladin, Barbarian, Wizard, Cleric, or Bard traders too?

    --

    Look back up at my post, now look back down, you're on the Internet. Now look back up. I'm a signature.
  20. Re:Literally too stupid for words by DickBreath · · Score: 1

    How do you know a trader knows something? Maybe his trade was just a lucky, an extremely luck, an unbelievably extremely lucky guess. You have no record that he received insider knowledge.

    --

    I'll see your senator, and I'll raise you two judges.