Posted on December 1, 2017 by staff

Data analytics turn up the heat on fraudsters


A London-based entrepreneur believes he could solve the headache of fraud prevention after growing his start-up to more than 50 staff in just 20 months.

Vishal Marria has worked in the data and financial crime space since 2005, leading global teams in financial services, fraud and compliance at giants including BAE Systems and EY.

The CEO began FinTech firm Quantexa in March 2016 after becoming frustrated by large organisations’ inability to make intelligent decisions based on data lakes accumulated at the cost of millions of pounds.

“The question kept coming up: ‘I’ve got the data set and incredible talent in my business, but what problem am I solving?’” he told BusinessCloud.

Quantexa matches external data to that within an organisation, such as a bank or financial services firm, to allow that firm to build a contextual picture of its clients and effectively manage risk.

External data could include that found on Companies House to ascertain whether an applicant for a loan, for example, is a director of a company or not; financial sanctions imposed on an individual in the past; or global news stories.

This can then enrich the internal data, such as transactional history around a bank account.

“Using our contextual monitoring, you could look at my name, address and telephone number and connect that information together to form a view of Vishal Marria,” said Marria.

“But we live in a world where we have bad data quality and missing information, so this is quite a challenge when an organisation is analysing billions of records.

“We are able to build a contextual view of a customer at scale and in real-time: Vishal and his wife are married and share the same address and home telephone number; he is paid a salary every month from Quantexa Limited; he spends his money on grocery shopping, clothes and in paying utility bills. You can quickly ascertain that Vish is a real person doing real behaviour.

“But what if you have four or five people connected together who are not acting in a normal fashion? The question may be: how do they live? What do they do? Why are random cash payments made into their account at irregular intervals? From that context, you may decide that they have taken over someone’s details or created fictitious IDs to open up bank accounts.

“I’ve seen patterns where someone has come to the country on a student visa for a few years and returned to their country, but before they left, a fraudster may have met them and offered to buy their bank account.

“For £500 or so the fraudster may have bought a bank account with four years of credit history – now he goes to town. He can spend out the limit, take out loans… the bank will write it off as a loss because the student isn’t there anymore. But ultimately the public will suffer because these costs are always passed down through the ranks back to normal people.”

Marria started out as a coder, having earned a first class undergraduate degree in computer science then a masters in information security, both from Royal Holloway University of London.

He says Quantexa is already moving into the oil, gas and government sectors alongside its core market of financial services. It turned over £1.3m in 2016 with a projected turnover of £6m in 2017 and plans to grow the staff to 80 by January.

Insight into customer behaviour for retailers is another potentially huge market. Marria says the ability to operate in a wide range of sectors means the four-year target of £40m is achievable.

“We won the Swift Innotribe award which gave us critical reconciliation to the market: it showed that we were tackling a massive problem head-on and not merely a solution looking for a problem,” he said. “On the back of that we are now working in the payments space with Swift, which is a great area to be in.”

Quantexa is also currently involved in a four-month Microsoft Accelerator programme which is aimed at developing a SaaS model of its tech – opening it up for use by smaller clients in 2018.

Quantexa, a name derived from quantity of analytics and exabyte of data – “combining analytics and Big Data” – raised $3.3m in Series A funding in March from HSBC and Albion Ventures. HSBC is also using the product as a client.

The London firm is already expanding internationally, with offices in Sydney, Brussels and New York City.

“Over time I expect the Americas will become our biggest market, from Toronto [in Canada] down through the United States, into Latin America and maybe even South America,” said Marria.