The UK government is facing criticism from MPs over its decision to award a contract to Palantir, a US spy-tech company, to access sensitive financial regulation data from the Financial Conduct Authority (FCA). The Liberal Democrats have called for a government investigation into the contract, citing concerns over Palantir's links to Donald Trump and its potential impact on national security.
According to a report by The Guardian, the FCA has hired Palantir to apply its AI systems to two years' worth of internal intelligence data to help tackle financial crime. However, insiders at the FCA have questioned whether there are sufficient safeguards to prevent Palantir's 'data lake' from being exploited in unintended ways.
Palantir, founded by Trump-backing billionaire Peter Thiel, has built up over £500m in contracts with UK government agencies, including the NHS, police, and Ministry of Defence. The company's European boss, Louis Mosley, has denied claims that Palantir may use customer data for its own purposes, stating that it is legally and contractually prevented from doing so.
Concerns Over Data Security
There are concerns that the contract could put sensitive FCA investigations into high-profile figures, such as banker Jes Staley and hedge fund boss Crispin Odey, at risk of being accessed during Palantir's work. The FCA has insisted that Palantir will be a 'data processor', not a 'data controller', meaning it can only act on instruction from the regulator.
The FCA has also stated that it will retain exclusive control over the encryption keys for the most sensitive files and that the data will be hosted and stored solely in the UK. Palantir will be required to destroy the data after completion of the contract, and any intellectual property derived from the data trawling should be retained by the FCA.
Despite these assurances, Daisy Cooper, the Liberal Democrats' Treasury spokesperson, has called for an investigation into the FCA's Palantir contract, stating that awarding a contract for sensitive UK financial data to a Trump-aligned tech giant seems like a 'huge error of judgment'.
Political Opposition
The Green party MP Siân Berry has also spoken out against the contract, stating that companies like Palantir should have no place within UK government systems due to their involvement in President Trump's 'illegal wars'. Martin Wrigley, a Liberal Democrat member of the Commons technology committee, has called for the FCA deal to be 'stopped before it's started', arguing that it could create a single behemoth that UK firms won't be able to compete against.
Donald Campbell, the director of advocacy at Foxglove, a tech fairness campaign, has expressed concerns that the contract is 'another worrying sign that Palantir is consolidating its hold over UK government services'. He has warned that there is a serious risk of 'lock-in' – the more Palantir is enmeshed in the UK's public services, the harder it may be to get them out.
Response from Palantir and the FCA
Palantir has stated that it is proud its software is being used to support the FCA in its vital work to tackle financial crime. The company has assured that the data cannot be commercialized in any way and that the software can only be used to process data in strict accordance with the instructions of the customer.
The FCA has also responded to concerns, stating that the data in the trial will not include trading records and that there is no risk of lock-in as it is just a trial. An FCA spokesperson has emphasized the need for the regulator to stay ahead of criminals who use technology to cause harm, while maintaining strict data controls.
