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Searchspace/IBM Technology to Help Wall Street Firms

With less than one month before initial anti-money laundering (AML) regulations from the USA Patriot Act take effect for the securities industry, Searchspace with its comprehensive anti-money laundering solution and strategic alliance with IBM is prepared to assist Wall Street. In response to the set of imminent compliance deadlines, Searchspace has developed a fast-track AML solution with IBM featuring rapid implementation of Searchspace's automated money laundering prevention software on the IBM platform.

"Wall Street is behind the curve on anti-money laundering and needs to respond quickly to meet the new regulations in time," said Konrad Feldman, CEO of Searchspace Corp. "Effectively combating money laundering is a complex task and represents new territory for many investment firms. It requires a proven AML system -- such as the 'fast-track' solution from Searchspace and IBM - that can be rapidly implemented to achieve results."

Traditionally, securities firms have not been subject to the same rigid AML regulations the retail banking industry has faced. The AML provisions in the Patriot Act changes that, causing securities firms to establish an anti-money laundering program by April 24, 2002.

"The Patriot act has a tremendous impact on the regulatory infrastructure of securities industry, including the need to quickly implement an effective AML system in an industry that traditionally has not fallen under AML guidelines," said Larry Tabb, vice president of the Securities & Investments Practice, TowerGroup. "While most retail banks already have technology in place, investment banks are starting from scratch, as they define data relationships, fraud patterns, and workflow processes, as well as develop an infrastructure that enables the sharing of information across the enterprise."

Searchspace and IBM unveiled a packaged AML solution in December 2001 to help financial organizations comply with new standards. The solution includes the Searchspace AML Sentinel Version 3.0, a mature software suite that has helped a number of major banks worldwide combat money laundering. The software runs on IBM's enterprise platform and includes support from IBM Global Services. Additionally, Searchspace software has been optimized to run with core IBM business applications. This packaged 'fast-track' approach ensures maximum performance with a key 'speed to implementation' advantage.

"New legislation is putting added pressure on financial institutions to identify money laundering exposures," said Al Sabo, vice president of Solutions, Financial Services Sector, IBM. "IBM has teamed up with Searchspace to provide the industry with a comprehensive, enterprise-wide anti-money laundering solution, based on IBM and Searchspace's leading technology."

AML for Wall Street

Securities firms face unique challenges in combating money laundering. First, many firms do not have an enterprise-wide anti-money laundering solution in place and must build a new system to meet new requirements. It is challenging to develop a system that can effectively track and monitor each transaction for potentially suspicious activity. It requires automated software that can handle large volumes of transactional data.

Further, tactics to launder money through a brokerage firm are often fundamentally different from money laundering schemes run through a retail bank. Securities firms require a specialized solution that can detect and report suspicious activity unique to the investment world. Simply using a solution made for retail banks will be ineffective.

Searchspace offers a specialized AML application for securities firms that understands the principals of securities trading and can track abnormal transactions for comprehensive AML monitoring. This application works with the Searchspace Intelligent Enterprise Framework (IEF), which captures and uses all transactions that flow through an organization to provide continuously adaptive profiles of all individuals. In this way every transaction that comes through the organization is monitored, analyzed and assessed for risk. The process is fully automated and runs around the clock for 24/7 protection. This runs on IBM's enterprise platforms with IBM business applications.

About Searchspace

Searchspace is a premier provider of intelligent software products that enable the world's leading organizations to realize the promise of the "Intelligent Enterprise." Searchspace helps clients derive value from existing assets, enabling real-time enterprise-wide responses to opportunities and risks, while driving efficiencies. Searchspace has provided solutions to a number of the world's leading financial services organizations. Clients include Bank of New York, Archipelago, Barclays, Royal Bank of Scotland, Bank of Scotland, Lloyd's of London, Lloyds TSB, London Stock Exchange and UBS. For more information visit www.searchspace.com.

About IBM

IBM is the world's largest information technology (IT) company and provider of IT services, as well as a preeminent technology partner to the world's financial services industry. Working directly with its financial services customers, IBM helps them become more competitive through the innovative deployment of high-impact solutions. These solutions comprise the full range of IBM capabilities including consulting, software, hardware, research and services. Additional information can be found at www.ibm.com/solutions/financialservices.