Communications of the ACM
New Technology Pinpoints Anomalies in Complex Financial Data
Battelle's Anomalator software pinpoints anomalous information in financial data to identify problematic trends that can put the global financial system at risk.
Credit: Courtesy of Frank Gruber
Battelle researchers at the U.S. Pacific Northwest National Laboratory have developed Anomalator, analytical software designed to recognize anomalous information that can help regulators, investors, and advisers better manage their investment and savings portfolios.
The researchers say the software could be used to fraudulent activity such as Bernie Madoff's Ponzi scheme in the future. "The Anomalator provides the unbiased, fact-based analysis needed to identify those problematic practices and help protect the nation's economy," says Battelle researcher John McEntire.
Anomalator uses algorithms to identify the atypical data in databases, creating a line graph representing the progress of anomalous funds or managers. Battelle recently licensed the technology to V-INDICATOR, which tested the software on Madoff's financial data. "There's virtually nobody who duplicates Madoff's straight line and that could or should have been a dead giveaway to anybody who was looking at the data," says V-INDICATOR's Burton Sheppard.
From Pacific Northwest National Laboratory
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