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Precise Sanction Checking

by | Jun 30, 2021 | Compliance, Financial Crime Academy

Precise sanction checking is essential to avoid the risk relating to dealing with potentially sanctions organizations, individuals, and even states. Since sanction checking requirements are frequently changed and updated, financial crime programs must adapt to tackle the most recent threats. The compliance requirements are continuing to be increased and the sanctions landscape is continuously changing, which makes it also more challenging to avoid fines or reputational damages. Businesses cannot afford not to adhere to applicable sanctions laws and regulations.

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Key Takeaways

  • Businesses must mature along the ever-increasing sanctions screening requirements in order to avoid penalties.
  • Sanction checking using novel technology help avoid risky situations and complete CDD and KYC regulations.

Sanction Checking – The Current Position

Organizations are oftentimes in a position where they have to compare real-time customer data against varying amounts of additional outside sources, including sanctions and politically exposed person’s (PEP) lists. Keeping up with the frequently changing requirements is a necessity for all businesses to avoid risky transactions with illicit companies or activities – or even worse, with sanctioned organizations or individuals.

The existing processes for screening in the financial industry may be insufficient, still resulting in large amounts of false positives. These current systems are not always efficient enough to keep up with the ever-changing regulations and frequent updates to sanctions list. A Celent report from 2020 notes that more than 20% of the global AML know your customer technology is used for screening purposes. If so much time and money are invested into such programs, they should be advantageous and accurate.

sanction checking

AI Screening Benefits

AI-managed screening solutions can support accurately identifying risk from a range of global databases and help to ensure compliance standards are being met. AI technology allows for timely data collection that is up to date and can lower your risk through precise detection. These types of sanction screening make it easier to tune processes and optimize modes, which in turn supplies you with real-time analysis, powerful statements, and perceptive consoles. 

In addition, advanced biometric technology allows for advanced accuracy, providing a new level of certainty that alphanumeric systems cannot. This process of collecting information is faster than manual analysis and increases true positives rather than false alarms, also while limiting inaccuracies in data and helping to identify PEPs, criminals, or sanctions individuals.

Summary

In conclusion, AI sanction checking might give organizations the ability to select the data is right for them and the ability to monitor and manage the business’s risk.

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