International Business Ma-chines Corp. has started selling an advanced Internet search service that it says can help banks learn more about their customers and spot terrorists who try to open accounts.
To allow banks to comply with the Patriot Act mandates about knowing the backgrounds of customers with big accounts, IBM and Semagix Ltd. of London introduced the Customer Identification and Risk Assessment System at a presentation to analysts Aug. 10.
The service uses the WebFountain tool, which one IBM executive calls "Google on steroids." IBM expects several banks to begin using the service this year, and Semagix will also market it.
Elaine Lennox, the vice president of sales and marketing for IBM's WebFountain group, said information obtained on the Internet is not always easy to filter for its usefulness or relevance. For example, she said, a Web site describing a terrorist group may list some of its members' names, but that still does not make it easy to locate the relevant information about the members on the site.
Traditional search engines focus on the popularity of certain keywords in a Web page. However, WebFountain evaluates whether the terms that appear alongside the original search term are associated with any illegal activities.
"We look at the context of the page to look at what's being talked about," Ms. Lennox said. "It enables you to take all the information you know about a customer and then search against all this data to let you know if you should worry."
WebFountain was first used in Factiva Insight for Reputation, a service Dow Jones Reuters Business Interactive LLC of New York introduced last year. Factiva uses the tool to evaluate a brand's reputation. For instance, it would find postings on Internet chat sites in which people said a new product upset or offended them.
Ms. Lennox said that, in response to requests from equity analysts and brokerages, WebFountain could be customized to deliver background information on specific stocks they are researching.
Ed Kountz, a senior analyst at TowerGroup Inc., a Needham, Mass., unit of MasterCard International, said some banks have used ordinary Internet search engines, such as Google Inc.'s, as part of their know-your-customer efforts.
However, for banks, WebFountain is a far better tool than commercial Internet search engines, Mr. Kountz said. "Googling as a pastime is one thing; Googling as a business process is not recommended."
WebFountain can also aggregate information from traditional sources, such as lists provided by the Office of Foreign Assets Control and the Federal Bureau of Investigation, when presenting its findings about a specific person.
Ms. Lennox cautioned that these lists, while valuable, may not always be up to date. Information shows up more quickly on the Web than it does in traditional databases, since news articles and other sites are constantly being updated, she said. "Increasingly, it's very hard to manage your risk just by looking at" the OFAC lists or FBI files.
WebFountain is also designed to look for people's affiliations and personal relations. For example, it can show whether an applicant is a member of a group the government is watching.
Michael Haney, a senior analyst at Celent Communications LLC in Boston, said this type of search tool could spot the terrorist connections of potential applicants through their real-life associations. "It's quite useful if you think" your bank is being used for "money laundering associated with terrorism," he said.
