Credit Suisse has struck a partnership with Palantir, one of Silicon Valley's most secretive start-ups, to stop rogue traders, the companies said this week.
The 50-50 joint venture, called Signac, will focus on catching unauthorized trading, with the aim of expanding the software and technology to monitor rogue behavior across the bank worldwide.
Palantir uses so-called big data – massive data sets that can be analyzed by computers to reveal trends and hopefully lead to better decision-making – and applies it to areas ranging from defense to fraud.
The company is valued at $20 billion after raising fresh funds last year, making it the fourth most highly-valued tech start-up in the world behind Uber, Xiaomi and Airbnb. Among its investors is In-Q-Tel, the CIA's not-for-profit venture capital firm that invests in technology companies in order to support U.S. intelligence agencies. The start-up was co-founded by Peter Thiel, who was also a co-founder at PayPal.
Palantir is considered one of the most secretive Silicon Valley companies, with clients including the U.S. Federal Bureau of Investigation (FBI) and the Central Intelligence Agency (CIA). The company was rumored to have helped provide the data that led to the killing of Osama bin Laden, although this has never been confirmed.
Signac will monitor employees actions and detect any deviations from the norm which could signal that there is some wrongdoing going on. The software can look at historical incidents of rogue trading and identify when there is employee behavior that matches this. And Signac will learn as new incidents pop up in order to improve.
Banks are under pressure to bolster their compliance after a number of scandals in recent years has rocked the industry.
Credit Suisse is also looking to improve its financial performance and on Wednesday announced that it was to accelerate its cost-cutting efforts.
"Today, we are announcing an increase to our 2018 cost reduction target from 3.5 billion Swiss francs ($3.59 billion)gross savings to at least 4.3 billion francs, driving our absolute operating