| NEW YORK, June 20
NEW YORK, June 20 A Wall Street regulator has
begun to migrate its surveillance and other watchdog duties to
cloud computing, which in combination with crunching big data,
will dramatically boost the organization's capabilities, two
officials at the agency said.
The Financial Industry Regulatory Authority began using
cloud computing at the beginning of this year in a roughly
30-month roll-out that will save FINRA $10 million to $20
million annually while making the agency operationally far more
By moving to the cloud, FINRA will gain increased processing
capacity and more space to store data, while reducing costs
because the service is only used when needed, Steven Randich,
chief information officer at the agency, said in an interview.
Technology is key to FINRA's mission to oversee brokerage
firms, monitor the U.S. stock market and protect investors from
potential fraud. Wall Street's industry-funded watchdog monitors
trading in almost 6 billion shares daily for abusive activity.
In the past, increasing capacity and storage cost more
money. FINRA, which processes 25 billion "market events" a day,
had hit the limits of what is commercially available, Randich
A market event can be a quote or a trade, or anything
related to an order from its creation to its clearing.
"We could have redesigned our system to scale across a lot
of big machines, but economically that's not really on the table
for us," he said. "By moving to the cloud we get dramatic
processing and storage scale at commodity prices."
A major benefit has been speed. Some of the more complex
queries FINRA runs on its data could take several hours in
extreme cases, but they are now are done in a few seconds,
"It's measurably, measurably faster," said Thomas Gira, who
is in charge of market regulation at FINRA. "It might take us to
another level in the sense of timeliness."
Gira said the new technology will allow FINRA to run
surveillance patterns more quickly and to do more data analysis,
although he acknowledged behavior in the electronic marketplace
is constantly changing, requiring the authority to continually
upgrade its own capabilities.
The early migration has focused on FINRA's order audit trail
system, or OATS, which accounts for a large part of processing
all of a day's market-generated data.
The hundreds of surveillance patterns FINRA runs need to be
written on the new platform, then tested against the old code to
ensure the results are the same. Once migrated, they will run
faster, Gira said, noting the results so far have been "pretty
(Reporting by Herbert Lash; Editing by Dan Grebler)