As the burdens associated with maintaining regulatory compliance continue to mount across the United States and abroad, financial institutions small and large have had to invest millions of dollars each year into their respective compliance protocols and staff just to keep up. Sophisticated client onboarding, risk management and screening technologies and the development of artificial-intelligence backed solutions continue to provide significant returns on investment in this regard for financial service providers, though there remains an undeniable need for skilled compliance professionals that can handle the day-to-day intricacies of the regulatory space while acting as intermediaries between their respective firms and the regulators and governmental authorities that oversee them.

Finding experienced individuals who can meet these demands has become increasingly challenging – and costly – however. Adding insult to injury for many of these institutions is the fact that these professionals are often mis- or under-utilized, being tasked with performing many of the time-consuming administrative duties that a comprehensive sanctions screening solution could perform in a matter of seconds. With even the most basic of Know-Your-Customer (KYC) and Customer Due Diligence (CDD) requirements falling under this umbrella, what has developed into a relatively common practice across the financial industry has placed undue strain on regulatory compliance personnel while leading to the gross misappropriation of resources that could be utilized for more meaningful and/or widespread duties across a company.

Given the current state of geopolitical affairs and their impact on legislation at the international level, specifically with respect to economic sanctions, inefficient screening practices can create additional manual responsibilities for financial institutions to address. False positives – i.e. instances where transactions, activities, or other information are incorrectly flagged as suspicious or non-compliant with current regulations –  often emerge due to the inherent complexities seen in the comprehensive screening process, especially as sanctions lists continue to expand. Unfortunately, given the sheer number of factors and variables that contribute to risk ratings and the number of yellow and red flags that emerge throughout the screening process itself, financial institutions adopting subpar technologies with the intent of reducing risk and cutting down on manual labor have actually created a run on false positives that have subsequently increased the amount of labor and resources necessary to address them.

When not addressed appropriately, these developments can drive up operational costs, congest organizational workflows within a compliance department and across an entire firm, and even go as far as to negatively affect consumer satisfaction. To address these issues, Global RADAR has developed a solution that offers A.I.-powered automated risk-rating, transaction monitoring, sanctions screening, and client onboarding that all but eliminates these hindrances to operational efficiency, allowing our clients to improve their compliance departments almost immediately.

Global RADAR recently teamed with renowned multinational information technology and consulting firm NTT Data to provide an end-to-end sanctions compliance service that screens against global watchlists and sanctions lists, as well as for money laundering, Beneficial Ownership (UBO), Politically Exposed Persons (PEPs) and for Adverse Media to better manage potential risks.

In a recent release, NTT DATA UK&I’s vice president Darren Temple explained the benefits of working with the powerful solution that Global RADAR offers:

“Working with our sanctions screening partner, Global RADAR…we will typically clear 99.7% of all subjects screened, only escalating those items that your Compliance professionals need to focus on. So, our experience shows that for every 10,000 subjects that we find and screen for you, your only touchpoint will be to focus on 30 escalated concerns.”¹

Such a service effectively allows for the formal analysis and ongoing monitoring of an organization’s comprehensive compliance activity in an efficient and customizable manner, factors crucial for navigating the ever-increasing challenges posed by today’s unique regulatory landscape. Temple continues, noting that his firm has “the capability to continuously monitor all subjects, whether that is from the documents and data you have sent to us previously or data you have sent to us via API from your policy administration system. You get to control the duration and frequency of the monitoring period.”¹

In today’s world, there is fierce competition between financial institutions to find competent compliance professionals. As such, having an all-inclusive, automated compliance system you can trust is invaluable to allow these professionals to maximize their capabilities and add value to one’s organization.

Citations

1. Temple, Darren. Free Your Compliance Team from Admin, 8 Dec. 2023.