Tokyo Stock Exchange operator taps NEC and Hitachi AI for market surveillance

Tokyo Stock Exchange operator Japan Exchange Group Inc. said Monday it has introduced artificial intelligence systems aimed at detecting market price manipulations and other misconduct. According to Japan Exchange Regulation, the group's self-regulatory body, the AI systems are designed to conduct preliminary surveillance to identify suspicious transactions. Surveillance personnel will analyze the results closely to determine whether the transactions should be reported to financial authorities. The AI systems are designed to help improve the quality of overall surveillance and speed up preliminary probes, giving staff more time to closely examine suspicious transactions, an executive of the self-regulatory body said. The group began research in August 2015 to see whether AI could be used for any of its operations, and later confirmed that systems developed by NEC Corp. and Hitachi Ltd. can detect unfair transactions with high accuracy.