When you run a query in Vertica software, it’s going to be lightning fast. Its performance you wouldn’t think is possible.

- Mike Krolnik, Head, Technology and Engineering, North American Bank

The world’s financial markets and financial services companies generate and store petabytes of data on a daily basis.

Their sheer number of applications, data elements, and regulatory requirements creates the “perfect storm” of information management. The culmination of these attributes and the fiercely competitive and time- critical nature of the financial industry results in an analytic opportunity only few can address. For example, fast risk analysis is essential at crucial time windows: prior to intraday trading, mortgage approvals, loan guarantees, and other financial transactions. In these and other situations, minutes could mean a difference of millions of dollars on a single transaction.

Financial services institutions (FSIs) need to continually run countless simulations and scenarios to assess risk and other regulator-ready benchmarks and metrics. It’s not only risk analysis that financial services and other enterprises must worry about. Detecting and identifying fraudulent activity – with credit cards, deposits, insurance, and more – has become an area of increased importance to organizations across the financial value chain. Vertica enables the financial services ecosystem to analyze and make informed decisions in near real time with SQL-based Monte Carlo techniques, integration with statistical modeling tools, Built-in machine learning algorithms, and unparalleled efficiency, performance, and scalability.

Top Vertica Use Cases for Fraud Monitoring and Risk Management:

Financial Risk Management

New sources of data and emerging technologies to analyze vast volumes of information are allowing banks, insurance companies, asset management firms, financial analysts and others to derive greater understanding of past and future financial performance and risks. Whether using data to run simulations of how unexpected global crises could influence asset holdings, determining the likelihood a borrower will default on their loan, or assessing potential adverse impacts on leverage ratios, financial institutions rely on Big Data now more than ever. As a SQL analytics database with support for all of the leading BI tools, Vertica was built to enable everyone — from skilled IT users to investment advisers, insurance representatives, and exchange floor traders — to obtain the answers they need now, not after the opportunity has passed.

Regulatory Compliance

In the wake of the global financial crisis of 2008-09, policy makers in the world’s financial centers issued a wave of new regulations to protect consumers and investors by enforcing best practices with regard to capital, liquidity, credit quality, and transparency. Those regulations include the Dodd-Frank Act, the Volcker rule, Base II, Solvency II, and other regulations imposed by the US, the EU and elsewhere. Complying with these regulations often requires running millions of simulations across incredibly large data sets. Vertica crunches massive data volumes and delivers near real-time insights to helping FSIs keep pace with the explosion of data needed to comply with these regulatory requirements.

Fraud Detection

Identifying fraudulent activity – whether in the banking system, a telecommunications network, or an online retailer – is a necessity given the growing sophistication of fraudulent methods and the need for businesses to maintain consumer confidence in their products and services. As perpetrators become more sophisticated, so too are the internal units tasked with identifying fraud. Vertica helps banks, insurance companies and online retailers identify fraudulent activity through advanced baselining and profiling of user behaviors, near real-time transaction analytics, and anomaly detection, all with the proven performance to scale over the largest data sets.

Finansbank unlocks a treasure vault of data

The Challenge:

  • Quickly determine what customer behaviors are benign and what behaviors are anomalous – and therefore potentially suspicious

The Solution:

  • Leverage Vertica to perform sophisticated SQL analytics on data collected by Security Information & Event Management solution and stored in Hadoop to facilitate high-speed baselining and profiling of user behaviors

The Result:

  • Over 120 GBs gathered daily from 15,000 sources and queries performed on 2-4 billion data rows
  • Report generation formerly lasted very long or may have failed; now generated in minutes without a single error for months
  • Baselines and profiles empower security team to quickly detect anomalies and better protect against hackers, malware, and fraud

Read the Full Case Study

Vertica implementation facilitated the generation of compliance and audit reports. Formerly, the supply of bulk reports was a time and human consuming job, whereas it takes minutes now.

- Erdem Alasehir, Consulting Security Designer, Finansbank