Case Study:
2015 SEC Fine Against UBS ATS

This year’s $14 million settlement between the US Securities and Exchange Commission (SEC) and UBS over allegations of misconduct in design, marketing and implementation of their ATS (dark pool) highlights the financial services industry’s ongoing struggles with the staggering (and growing) complexity of trading algorithms. We demonstrate how UBS can leverage AI’s groundbreaking formal verification technology to help prevent further regulatory fines related to the design and implementation of UBS dark pools.

Powered by recent breakthroughs, our product Imandra is able to automatically prove properties of fairness and best execution of venue designs and test production implementations with unprecedented rigour. We demonstrate how Imandra can automatically detect and test for key recent issues raised by the SEC. Furthermore, based on UBS’s publicly available Form ATS filing, we apply Imandra to highlight additional potential issues with UBS’s current dark pool design. Finally, we discuss applications of Imandra to a wide range of financial algorithms, including routing systems and smart contracts.

Download: Case study

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