Historically, when large institutions submitted thousands or millions of customer names for overnight batch screening to ascertain whether they were doing business with the wrong people, the available technology dictated that they were all treated the same – subject to the same, one size fits all, insensitive search algorithm, often searching on just the name of the subject. This was crazy.
It meant that firms had to choose between setting the match parameters loose, to avoid missing potential hits with different spellings to the information which they held for their customers and suffering huge numbers of daily false positives as a result. Or setting them tight, limiting false positives but in the full knowledge that they would likely miss some true matches as well.
In every other aspect of how they dealt with these customers they could take into account their risk status. Treating a Liberian government minister and a pensioner from Basingstoke the same for screening purposes when they are at opposite ends of the AML risk spectrum makes no sense at all.
When KYC Global Technologies launched its ground breaking RiskScreen Onsite Batch solution in late 2017 it immediately leaped two steps ahead of the competition. Users of RiskScreen Onsite Batch could not only add ‘metadata’ – date of birth, countries of association, gender etc – to their search queries to make them more accurate – they could also customise the search algorithm used for their subjects depending on the subject’s existing risk profile – and this included how the metadata was treated, as well as the search name. This meant that a high risk customer could be given a looser set of match criteria, with low and standard risk customers given a tighter algorithm. When married with the world’s highest quality sanctions, PEP & Watchlist data (provided by Dow Jones) this had an incredible effect: users saw their false positives reduce by 70-95% with no reduction in true matches. This resulted in:
- Higher staff morale, as the necessity for boring and time consuming processing of false positives was dramatically reduced
- A dramatically reduced likelihood of true matches being missed by overworked staff not expecting to come across a ‘needle in a haystack’
- Time and money saved for RiskScreen Onsite Batch’s customers
In 2019, the best has just got better. KYC Global Technologies has produced the first batch screening tool anywhere to offer a 3D Risk Based Approach. Now, in addition to customising how the searching of a customer’s name and meta-data should be carried out according to the customer’s risk profile, RiskScreen Onsite Batch enables the treatment of metadata to be varied according to what source is being screened against. This means that users could, for example, automatically discount potential PEP matches in which the country of the search subject did not match the country of a given Dow Jones record, whilst specifying that potential sanctions matches should be returned regardless of whether the country data for the subject matched that for the Dow Jones record found.
This development enables users to be even more precise in deciding exactly how each of their customers should be screened. Together with RiskScreen’s sophisticated alias matching technology, it will enable users to virtually eliminate false positive matches, with no loss of search accuracy, driving bulletproof results which will satisfy the most stringent internal and external audits. Lightning fast and with a superb user interface and MI suite, RiskScreen Onsite Batch is a world away from the clunky, outdated batch screening technology still in use across much of the finance sector.
Stephen Platt, Chief Executive of KYC Global Technologies said: “A lot of businesses claim to offer ‘next generation’ technology but in our case it’s true. Our customer screening technology is revolutionising the way in which businesses manage AML risk. We are able to do this because we have combined deep AML expertise with data science to develop world leading technology now being utilised by almost 1000 financial institutions around the world. It’s a testament to Jersey’s dedicated approach to the prevention of money laundering that we have been able to develop the technology here”
About KYC Global Technologies: A rapidly growing RegTech business specialising in the development of customer screening and advanced data analytics technology. We believe there is a moral imperative in fighting financial crime. We also believe that conducting business ethically is conducive to the development of sustainable business. We know that smart technology is the key to enabling businesses to know their customers and to use data to drive business decisions that do no harm.
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