Palantir FCA Contract: MPs Demand Halt Over Data Security & Trump Links

UK Financial Watchdog Faces Scrutiny Over Palantir Contract

The UK’s Financial Conduct Authority (FCA) is facing mounting pressure to halt a contract with US-based data analytics firm Palantir, as concerns grow over data security and the potential for undue influence. Members of Parliament are calling for a government investigation into the deal, which would grant Palantir access to two years’ worth of the FCA’s internal intelligence data in an effort to combat financial crime. The contract, revealed earlier this week, has ignited a debate about the UK’s reliance on US technology companies and the safeguarding of sensitive financial information.

The FCA intends to use Palantir’s artificial intelligence systems to analyze the data, aiming to identify and prevent financial wrongdoing. However, critics point to Palantir’s history and connections as reasons for concern. Founded by Peter Thiel, a prominent supporter of Donald Trump, the company has contracts with US and Israeli military and intelligence agencies, including US Immigration and Customs Enforcement (ICE). This has fueled anxieties about the potential for US government access to sensitive UK financial data, despite assurances from the FCA.

Liberal Democrat Treasury spokesperson Daisy Cooper has called for a full investigation, describing the contract as “a huge error of judgment.” Sian Berry, a Green party MP, went further, arguing the contract should be blocked entirely due to Palantir’s ties to Trump. The concerns extend beyond political affiliations. Insiders at the FCA have reportedly questioned whether sufficient safeguards are in place to prevent the exploitation of the “data lake” created by Palantir’s systems.

The FCA maintains that Palantir will operate solely as a “data processor,” not a “data controller,” and that the regulator will retain exclusive control over encryption keys for the most sensitive files. The data will be hosted and stored within the UK, and Palantir will be required to destroy the data and any intellectual property derived from it upon completion of the 12-week trial. However, one FCA insider told the Guardian that available information regarding risk control and mitigation was “very lacking in details.”

This contract arrives amidst a broader trend of Palantir expanding its footprint within the British state. The company already holds over £500 million in contracts with the NHS, police, and Ministry of Defence. Martin Wrigley, a Liberal Democrat member of the Commons technology committee, warned of the dangers of creating a “single behemoth” that UK firms would be unable to compete with, advocating for the development of domestic industries instead.

Palantir’s European boss, Louis Mosley, has been actively engaging with MPs to address what he calls “misconceptions” about the company’s technology, denying claims that it might use customer data for its own purposes. However, skepticism remains, particularly given the breadth of data Palantir will be accessing – potentially including personal details and trading records related to investigations into high-profile figures like banker Jes Staley and hedge fund boss Crispin Odey.

Donald Campbell, director of advocacy at tech fairness campaign Foxglove, cautioned against the risk of “lock-in,” suggesting that the more deeply Palantir becomes embedded in UK public services, the more difficult it will be to remove the company in the future. The FCA insists the trial is low-risk, stating that it will not include trading records and that there is no risk of lock-in due to the limited duration of the contract. The regulator maintains that utilizing technology is crucial to staying ahead of criminals.

The controversy surrounding this contract underscores the growing scrutiny of Palantir’s operations and its increasing influence within the UK government. As the debate intensifies, lawmakers and the public will be watching closely to see whether the FCA will proceed with the contract, and what safeguards will be put in place to protect sensitive financial data.