The Financial Conduct Authority (FCA) has saved £20 million through recent IT upgrades, and continues its modernisation programme with more than £12 million in new contracts.
The FCA data strategy update, released today, shows how the authority is modernising its core IT systems. It has moved its data centre to the cloud, introduced a central “data lake” store, and has brought in new analytics and data science tools, and a rules-based decision hub which the authority is using to improve its handling of cases.
“We estimate that through IT system cost-savings and the introduction of new analytics tools we have reduced the amount of time our employees spend searching for, collating and analysing data. This has led to £20m of operational efficiency savings achieved through replacing older, more inefficient systems and through time saved by staff who can work more quickly,” said the FCA data strategy update.
In addition to upgrading initiatives such as the Digital Sandbox, the FCA has also awarded two multi-million-pound IT contracts, for application maintenance and support services for £7 million to Sopra Steria, and a digital squads contract for £4.9 million to Kainos Group. It also awarded a small contract for a code scanning tool to Insight Direct.
Last week the FCA’s efforts to create synthetic data sets as part of the Digital Sandbox project won the “Pioneer” award at the 2022 Central Banking Awards. The use of synthetic data allows financial firms to test or validate potential products, without the risks of using real user data, with all the risks that brings.
Jessica Rusu, chief data, information and intelligence officer at the FCA, said in a LinkedIn post: “Many claim that ‘data is the new oil’ and we must seek to extract the value from it. For the FCA, data is at the core of our work as a regulator. We collect data about firms, markets, transactions, consumer harms, and the global economy, and use it to make regulatory decisions.”
And in a press release she added: “Better use of data means we can be more proactive and find and stop harm faster. We are continuing to improve our data, technology and capabilities to act decisively in consumers interests, while making it easier for firms to report to us.”
Along with all the upgrades to its technology, the FCA data strategy said the authority is continuing to recruit AI, analytics and data science specialists, along with cloud and IT professionals. The authority said it has recruited 100 specialists of these kinds since 2020.
FCA data strategy scrapes off scammy websites
The FCA data strategy also gives some insight into how the authority is working to improve its data science and digital fraud detection capabilities. The FCA said it is now scanning an average of 100,000 newly-created websites a day for signs of fraud or scams, and identified 1,966 companies creating illegal websites between May 2021 and April 2022.
It seems the FCA is not sitting still on this; earlier this month it awarded a £178k contract to Incopro for “web scanning and cybercrime disruption services”. The contract specifically highlighted investment scams as a key area of focus for the new service.
“The FCA requires services that will support the FCA in its identification and take-down of websites, telephone numbers and social media accounts containing infringing content, with a particular focus on illegal financial promotions of products and services of investments or financial services,” said the contract notice.
“We are also looking for the third party to have strong data analytical tools that can carry out proactive monitoring and web scraping on a far reaching, speedy, industrialised basis.”