The firm produces R3cognition (pronounced
'recognition’) Web, a web-based programme which it
describes as a "speed camera for derivatives traders".
Its main clients are member firms of exchanges, from market
makers to investment banks, which use the software to identify
breaches of regulation and track patterns of improper
The brand has changed but still refers to what R3cognition
calls the three R’s – risk, regulation
The system, which works on a T+1 basis, automatically sends
out an alert when a trader breaks regulations. It uses
exception-based monitoring, which means the only trades flagged
are those which breach exchange rules.
A summary of the rule that has been breached is sent along
with the alert, so that a compliance officer can explain to a
trader what has happened. The alerts come in the form of daily
T+1 compliance reports, so that users can have all the
information they need in one document.
Compliance officers can view the alerts on a trader by
trader basis, so that they can spot systematic offenders.