Behavox, a compliance software company focused on the financial services sector, and Cloud9 Technologies, a cloud-based voice trading communication platform for financial firms and institutional traders, announced a joint partnership today. The collaboration provides an immediate solution for firms facing heightened regulatory requirements and adds significant value for those with no existing compliance solution, as well as those with inadequate legacy approaches.
Behavox is valued in the market for its expertise in machine learning, developing robust algorithms based on 16 years of enforcement cases against traders and banks worldwide. Behavox utilizes these algorithms with sound processing, to enable keyword detection, highlight variants in emotion/sentiment, and tie voice records to data points that signal market abuse, insider threat, collusion, or reckless behavior. This technology enables an extreme reduction in false positives as well as compliance costs.
Cloud9 is currently the only cloud-based communications solution for the capital markets with a comprehensive strategy around analytics and voice capture. The platform delivers value by collecting voice recordings as well as enhanced call metadata– adding additional insight not available with legacy services. Cloud9's partnership with Behavox supports their ongoing strategy to provide their customers with a full suite of monitoring, compliance and analytics solutions through integration with leading third-party trading technology providers capable of leveraging Cloud9's generated voice and metadata.
"At Cloud9, we have created a partner ecosystem that enables us to provide enhanced compliance, analytics and trader workflow capabilities around voice and translate it into actionable data – a feature that was previously unavailable to firms," said Cloud9 Technologies CEO, Jerry Starr. "Partnering with an innovator like Behavox greatly benefits our customers and enables them to use their recordings and advanced metadata to manage both operational and reputational risk."
"Cloud9 is a logical partner for us. The unique combination of their enhanced metadata and data capture with the superior analytics capabilities of Behavox will enable firms to gain rich insights into trader behavior like never before," said Behavox Founder and CEO, Erkin Adylov. "This is a significant development and another logical step towards enhancing and automating data gathering in the compliance process."
Compliance remains a critical consideration for financial firms as they try to keep up with regulatory changes such as MiFID II being effective from 2018, increased reporting and data capture requirements, as well as the ongoing avoidance of corporate and individual liability.
As a result, firms have tried to solve the problem by investing millions of dollars in compliance, particularly on back office investigators, lawyers, and intelligence officers to sort through and monitor trader communications. Market demand is placing a premium on the quality, processing, ingestion, retrieval and archiving of voice data for front office and compliance purposes. The Tabb Group estimates the global compliance market is at $2.5bn now and still growing.
Hosted in the cloud and distributed in a SaaS model, Cloud9 provides a cost-effective solution for firms, helping them save up to 50% on trader voice costs while generating unique, proprietary content critical for advanced analytics and compliance. By establishing interoperability with Behavox, mutual customers experience a significant reduction in compliance expenses, as well as communications costs, and gain a secure, future-proof network for the management of voice trading, regulatory compliance and advanced voice analytics.