At the University of Sunderland in the UK, developers are working on a “smart” computer system that is designed to spot signs of insider trading and spin. The Press Association reports that the system, which is known as Cassandra (Computerised Analysis of Stocks and Shares for Novelty Detection and Radical Activities), will track share movements and news headlines to identify insider trading and flag false rumors and exaggerated claims intended to distort the market.
Dr. Dale Addison, who heads the Sunderland development team, said: “If successful, Cassandra will make it more difficult for unscrupulous traders to make a killing on the stock market at the expense of others.” He added that Cassandra is intended to address a big problem with current anti-fraud systems: false positives. “The stock market is highly volatile with stocks and shares going up and down all of the time, and sometimes there is a perfectly rational explanation for these fluctuations. As many as 75% false positive flagging has been observed by some systems,” he stated.