Chapter 2: AML Data & Core Features

Choosing a screening solution that provides authentic, accurate data and fits well with your risk assessment process is key to a successful compliance program.

Let’s get an overview of the coverage that every screening solution must have.

Integrating Real-Time Data For AML Solutions

To be adequate for AML screening purposes, the solution should be capable of updating changes in the sanctions, watchlists, PEP databases, and the corresponding risk levels in a real-time.

With the rising global regulatory pressure, data integrity and reliability have become business essentials. Many companies in the industry rely on third-party data providers which limits them from offering customizable features to their end clients.

However, AML Screening vendors must adopt an in-house data extraction approach to meet the on-demand customization requirements of the clients.

What Does This Mean?

Instead of depending on external data providers, the right AML solutions must have their own capabilities to gather and extract data directly from authorized and official resources. This approach involves deploying advanced technologies and methodologies to collect information from various sources, such as public records, databases of regulatory bodies, adverse media, and other proprietary sources.

With its exclusive access to primary data, AML vendors can customize their data into a product that matches the specific risk appetite of the AML-obligated entities. The solution must tailor the screening parameters and risk assessments to align with these specific needs.

This customization ensures that businesses receive relevant risk alerts that are calibrated to their business’s operations, specific sectors, and customer base.

Achieve Accuracy With Regular Data Updates

AML and Sanctions compliance regulations and political dynamics continuously evolve, altering the risk profiles of your customers, hence it is necessary to onboard an adaptable AML Compliance solution.

Choose a vendor that adopts your business’s transformation in response to changing international and jurisdiction-level regulations, evolving internal compliance frameworks and thus helping your business expand with such dynamics.

At AML Watcher, the information in our database is updated every fifteen minutes which means obligated entities can access data or information on the latest enforcements, designations, etc.
Our in-house team of dedicated researchers and data analysts compile and verify information from various official and reputable sources, including international regulatory bodies, financial institutions, and trusted media outlets.

By directly fetching data from primary sources and then cross-referencing and validating data, we create proprietary databases that are not only extensive but also highly reliable.

This in-house data collection by expert researchers spans all jurisdictions and keeps in view the tailored needs of different sectors, offering detailed coverage regardless of geographic or operational context. This procedure greatly lowers false negatives and improves overall system reliability by enabling accurate, up-to-date screening for financial crime concerns.

Does Your Solution Help You Comply With the No-One-Size-Fits-All Approach As Proposed By FinCEN?

Effective AML screening goes beyond global data coverage—it’s also about aligning with your business’s risk appetite and customizing risk management strategies to fit your unique needs. By tailoring screening protocols, you can prioritize threats that matter most to your operations, whether adjusting thresholds or integrating specific risk indicators. This precision not only optimizes resource allocation but also ensures compliance across diverse regulatory landscapes.
This opens the door for deploying an efficient AML screening solution that targets two core objectives: managing risk and fulfilling legal obligations.

Choose A Vendor Offering Data That Aligns With Your Risk Appetite

Pick a compliance solution provider that must be fully customizable to your organization’s unique risk appetite. Every business has its own definition of what constitutes a ‘high’ or ‘low’ risk customer according to its risk appetite. Ensure that the solution allows you to modify your risk profile based on your unique understanding of high and low risk.

These risk factors can be adjusted to fit the company’s needs, strategic direction, and risk appetite, which enhances the ability of the solution to identify the relevant red flags for maximum accuracy.

The coverage should include all jurisdictions where your organization operates, or may have exposure to different types of risk data as per your organization’s risk appetite and your cross-border operations exposures to foreign transactions and trades.

Must-Have Of Your Optimal AML Data Partner

Data That Truly Helps You Turn Compliance Into Competitive Advantage

Create a file of essentials that are necessary and need to be included and a list of the Data features that are ‘must-haves’ from the current screening processes to continuous AML compliance plans.

To provide a better idea of what features a good AML compliance solution needs to have, look at the list below.

Design Guide: ADD drop-down for all these 8 Product Features

Sanctioned Entities and Individuals Data

Sanctions are protective constraint actions involving travel or investment prohibitions, trade and weaponry embargoes, asset freezes, and asset blocks. Sanctions screening systematically screens against lists of sanctioned parties, vessels, entities, or high-risk jurisdictions maintained by global regulatory bodies. Sanction lists are growing daily along with the complexity of volatile geopolitical dynamics, making it harder than ever for institutions to efficiently detect and manage sanctions risk.

Politically Exposed Persons (PEPs) Data

Information about people holding prominent positions in the public domain is examined to evaluate possible corruption and money laundering risks. While there are no restrictions on conducting business with PEPs, conducting regular screening is frequently necessary because of the potentially high risk of money laundering associated with the PEPs.

Watchlists Data

Watchlist screening entails matching names to lists maintained by various international organizations and governments. It assists institutions in avoiding engaging with parties that are restricted or pose a significant money laundering and terrorist financing risk.

Adverse Media Screening

This encompasses negative information produced by the media, regulatory authorities, and other officially inspired documents about customers or a business partner that is likely to pose a risk of financial crime. Adding adverse media screening is crucial as it not only helps assess the true money laundering risk of PEPs but also common citizens who could be criminals but don’t have any name in any PEP, sanctions, or watchlist database.

International Leaks

As for AML compliance, financial institutions can additionally check the potential risk associated with clients by performing Internationally leaked document screening. From offshore links to search millions of leaked files, improves KYC/AML practices, running detailed checks and providing ultimate in terms of financial transparency. Screening names against the International Leaks database is an additional parameter to determine the risk level associated with an individual.

Special Interest Entity

A Special Interest Person, also referred to as a SIE or Special Interest Entity, is a person or entity that has been charged, found guilty, detained, or is presently awaiting trial for offenses such as financial crimes like fraud, theft, money laundering, organized crime, terrorism, tax evasion, or war crimes.

Beyond the basic PEP data and sanctions lists, there are numerous other kinds of blacklists published by regional governments and international authorities to screen SIP/SIE.

Vessel & Aircraft

It involves checking vessels and aircraft against international sanctions lists and maritime blacklists to ensure compliance with regulations and prevent the use of transport for illicit activities, and avoid dealings with sanctioned entities or high-risk individuals. It also monitors suspicious movements to protect the integrity of global financial and trading systems including maritime trade. Sectors such as maritime charterers, insurance companies, brokers, customs organizations, classification societies, cargo suppliers, customs and port state controls, flag registries, ship brokers, ship owners, bunker suppliers, shipyards, and various financial institutions involved in maritime trade finance come under the screening regulation

Director’s Fitness & Probity

Director’s fitness and probity involve assessing individuals’ suitability and integrity for key positions in financial institutions. This includes background checks, verifying qualifications and experience, and evaluating their reputation for honesty.

Primarily, AML Compliance solution is a key partner of any obliged entity which ensures that an accurate risk level is flagged and valuable customers don’t face any inconvenience while starting their journey with your business. This assists your compliance team in determining how to convert your potentially good customers into valuable customers.

Under these parameters, select a solution partner that is capable of offering data that will streamline the onboarding of new clients, and conduct continuous screening on existing ones, while also scaling up your AML checks with additional business growth & regulations.