LSEG Launches Market Surveillance Tool to Strengthen Compliance and Market Integrity

The London Stock Exchange Group (LSEG) has announced the launch of a new regulatory technology solution designed to help market participants more effectively identify, investigate, and manage potential market abuse and financial crime risks across trading venues. The solution — branded Trade Surveillance — combines advanced data processing with contextual market insights, enabling firms to strengthen compliance, reduce operational risk, and gain deeper visibility into trading behaviour in increasingly complex markets.

As regulatory scrutiny intensifies globally and financial markets continue to fragment across asset classes and geographies, surveillance tools have emerged as critical infrastructure for firms that must comply with laws such as the Market Abuse Regulation (MAR) in the European Union and the UK, as well as other domestic and cross-border regulatory frameworks. LSEG’s entrance into this space reflects both the strategic importance of surveillance technology and the broader trend toward data-driven compliance solutions in capital markets.

Why Surveillance Matters: Regulatory Pressure and Market Complexity

Market surveillance is the systematic monitoring of trading activity to detect behaviours that may constitute market abuse, manipulation, insider trading, wash trading, layering, or other forms of illicit conduct. Regulators and exchanges require sophisticated surveillance capabilities because modern trading is fast, high-volume, and highly automated, often spanning multiple venues and asset classes. Traditional tools — largely rules-based systems developed decades ago — can struggle to keep pace with the evolving complexity of markets and the regulatory demand for real-time detection of misconduct.

The European Union’s Market Abuse Regulation (MAR) and similar regimes mandate that firms have robust systems for identifying, reporting, and mitigating suspicious activity, with significant penalties for failure to comply. Increasingly, regulators also expect firms to utilise cross-market and cross-asset surveillance that can identify patterns across fragmented venues — a challenge when trading takes place across equities, fixed income, derivatives, and foreign exchange markets simultaneously.

Against this backdrop, LSEG’s Trade Surveillance is positioned as a modern solution that combines trusted data, contextual market insights, and behavioural analytics to help firms meet regulatory obligations while managing the practical challenges of surveillance at scale.

Introducing LSEG Trade Surveillance: Features and Capabilities

LSEG’s new Trade Surveillance suite includes two core solutions tailored to different market segments:

1. Trade Surveillance for MiFID Instruments

Targeted at firms trading instruments under the Markets in Financial Instruments Directive (MiFID) regime in the UK and EU, this solution delivers multi-market, multi-asset surveillance capabilities. By leveraging a consolidated European order book — built from data across more than 40 trading venues — the system provides cross-venue alerting and behavioural analysis designed to uncover suspicious or anomalous trading patterns that might otherwise evade detection within siloed systems.

This comprehensive data processing reduces false positives and gives compliance teams actionable insights grounded in both private trade data and public market context — a key differentiator compared with older, rules-only systems. The MiFID solution is especially relevant for firms subject to regulatory reporting requirements and with exposures across European markets.

2. Trade Surveillance for FX Markets

Foreign exchange (FX) markets are among the most fragmented globally, with trading spread across numerous electronic venues, spot matching engines, derivatives markets, and interdealer platforms. LSEG’s FX surveillance solution provides real-time monitoring of spot FX transactions captured through its Spot Matching order book, the LSEG FX Dealing and Advanced Dealing platforms, and third-party venues via the Trade Notification Network.

By correlating a firm’s private trade data with public FX order flow and reference data, the system aims to give compliance teams more context and visibility into trading anomalies — enabling them to assess patterns of behaviour with greater confidence and pinpoint potential misconduct without unnecessarily high volumes of false alerts.

Contextual Data Integration

A standout feature of LSEG’s Trade Surveillance is its integration of contextual public market data, reference feeds, and news signals, which help firms evaluate trading activity in light of broader market conditions. This contextualisation assists in differentiating between genuine market movements and behaviour that may indicate abuse, reducing noise and helping compliance teams focus on high-risk signals.

Market Need: Fragmentation and False Positives

One of the persistent challenges in surveillance is the prevalence of false positives — alerts triggered by benign trading activity that nevertheless meet narrow rule criteria. False positives can overwhelm compliance teams, leading to wasted resources and slower investigation cycles. Modern surveillance systems increasingly emphasise behavioural anomaly detection, which uses machine learning and statistical analysis to flag genuinely unusual or suspicious trading patterns rather than relying on static rule sets.

LSEG’s platform is designed to address these market realities by leveraging its vast data assets and analytics infrastructure. Because the solution can process large volumes of order and trade messages across venues, it offers a richer, more nuanced view of trading behaviour — helping firms reduce noise, improve accuracy, and get ahead of emerging risks.

Strategic Implications for Financial Institutions

For financial institutions, market surveillance is not just a regulatory checkbox — it’s a risk management priority that impacts reputation, compliance costs, and operational resilience. Effective surveillance can help firms:

• Detect misconduct before it escalates into regulatory breaches
• Reduce fines and sanctions associated with market abuse
• Improve internal controls and audit trails
• Enhance trust with clients and regulators
• Streamline compliance workflows and reduce manual investigation costs

By bringing a modern, data-rich surveillance solution to market, LSEG is competing with established third-party providers of compliance technologies and signaling the growing strategic importance of data and analytics in regulatory infrastructure.

Industry Context: Surveillance Solutions and Competition

Market surveillance is a rapidly growing segment within the broader regulatory technology (RegTech) space. Firms such as NICE Actimize, Nasdaq SMARTS, and Bloomberg also offer sophisticated surveillance platforms that combine rule-based detection with analytics and machine learning. Recently, collaboration between Refinitiv (an LSEG business unit) and NICE Actimize has expanded the distribution footprint of the SURVEIL-X suite across Asia-Pacific — highlighting demand for integrated surveillance solutions.

What differentiates LSEG’s Trade Surveillance is its tight integration with exchange and order book data, drawing on the group’s position as both a market operator and a global data provider. This allows the tool to give users unique insights grounded in venue-level information, which entrenched third-party solutions might not have direct access to.

Regulatory Alignment and Cross-Border Appeal

LSEG’s solution explicitly supports compliance with regulatory frameworks such as MAR and MiFID, making it especially relevant for firms operating within the UK and EU jurisdictions. Its cross-venue capabilities help firms who trade across European markets and need consistent, consolidated surveillance workflows.

The inclusion of an FX-focused module also expands its applicability to firms that handle significant currency trading activity — an often under-served surveillance domain due to the fragmented and global nature of FX markets.

Quotes from Leadership and Next Steps

LSEG executives have framed the product launch as both a response to regulatory demand and a strategic extension of the firm’s data and technology ecosystem. Bruce Kellaway, CEO of Regulatory Reporting Solutions at LSEG, emphasised the importance of effective surveillance in ensuring compliance with market abuse regulations — a core responsibility for regulated firms.

Bart Joris, Head of FX Sell-Side Trading at LSEG, noted the importance of context in assessing regulatory risk in fragmented markets — a need that the new FX surveillance offering is designed to address.

Moving forward, LSEG is expected to continue building on this launch by enhancing machine learning models, broadening asset class coverage, and deepening integration with its wider suite of data, analytics, and risk solutions — potentially bringing surveillance closer to real-time threat detection.

Conclusion: A Strategic Step for Compliance Infrastructure

The launch of LSEG’s Trade Surveillance tool underscores how exchanges and market infrastructure firms are stepping into regulatory technology domains traditionally served by specialised vendors. With regulatory requirements tightening and markets becoming more complex, tools that offer rich data integration, behavioural analytics, and cross-venue insights are increasingly essential.

LSEG’s offering — built on trusted data, contextualised market activity, and sophisticated alerting — positions it as a competitive entrant into the surveillance market. Its dual support for MiFID and FX markets, coupled with the ability to reduce false positives and enhance compliance workflows, may make it a compelling choice for firms seeking a robust and scalable surveillance solution that aligns with evolving regulatory expectations.

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