For businesses and particularly financial institutions, threats and risks of exposure to economic crimes like money laundering, fraud, and terrorist financing are always there.
Why is this? Criminals always find loopholes in financial institutions, which they can use to move their illicit funds to jurisdictions with weak regulatory compliance programs.
Most banks have already incorporated the AML screening solution into their operations to halt the chances of exposure. Still, it should be more effective for internal and external reasons.
However, businesses can benefit from advanced AI and ML-powered global watchlist search screening.
Today, we will discuss these benefits and how any business can benefit from them.
As business dynamics evolve at a fast pace, threats and risks are also coming with the same force towards the financial institution, including the fear of economic loss and reputational damage, whether the business gets involved in it intentionally or unintentionally.
The following writing will discuss how, with a global watchlist screening search, businesses can gain various advantages and mitigate the chances of being exposed to illegal activities.
What does Global Watchlist comprise?
Hundreds of thousands of people are sanctioned by one body or another on different charges.
The list of all these people included in one list or another, such as sanctions lists, PEPs lists, Adver media lists, Fraud lists, and so on, is officially known as the global watchlist.
Screening against these sanction lists is essential for businesses to comply with the AML regulations and avoid exposure to any illegal activity that could damage the business’s reputation or cause financial loss.
5 Ways Global Watchlists Screening Helps Businesses
1. Reduce the Risk Level
Every organization wants to avoid risk, and when you run financial institutions, the level of risk increases automatically.
So, what is the way to secure? The global watchlist checkactually comprises a list of different sanctioned people, so if businesses want to avoid risks like money laundering and other financial crimes, they need to screen against these sanctions lists comprehensively so that they can avoid attracting people involved in criminal activities.
So, keep screening and avoid the potential threats and risks of facing penalties and reputational damage.
2. Allow Businesses to comply with Regulatory requirements
Businesses might avoid some operational activities, but they are not allowed by any chance to follow the regulations set by the national and international regulatory bodies. You know why is it? Yeah, you must be interested in knowing this.
Imagine if your organization is not following the AML regulations and you see criminals find it beneficial and easily launder money using your platform.
So what next for organizations? Million-dollar penalties like the one HSBS had to pay back in the past and reputational damage that is more costly than even the money.
3. Increase the Enhanced Due Diligence Process
Identifying the culprit’s mind as soon as possible is essential. Do you know why? Because organizations interact with high-risk customers, enhanced due diligence becomes necessary to locate such entities or business partners.
The interesting part is that you can check every client’s background history to see if they were involved in criminal activities in the past. If so, conduct comprehensive due diligence to avoid exposing the business to financial crimes.
4. Protect Business from any Financial Loss
It isn’t weird to read that it protects banks from financial loss. What is the connection between banks and financial loss that comes if global watchlist screening is not implemented?
There is a direct link between these two. Suppose an organization deals with a person sanctioned by one or many regulatory bodies. What’s next? Millions of dollars are lost in the name of penalties and fines that organizations have to pay at any cost, or the business will be banned.
5. Enhances Business’s Brand Reputation
Reputation is what brings money and business to any organization. Therefore, businesses that regularly screen their customers against the global watchlist have very few chances of interacting with criminals and also stand out as well-reputed and trusted organizations in the market.
And what message does this convey to the world? It signals to the world that the company prioritizes security, responsibility, and lawful conduct and ensures it is following the AML regulations.
Every business owner knows how important it is to maintain a good reputation and stand out from competitors in the market.
A good reputation means you have a higher chance of attracting potential clients and growing the business overall.
Summing It Up
Global watchlist screening is very helpful for businesses in many ways. But the question remains: How can it be screened effectively? Contact an AML software solution
that screens all the global watchlists in real-time to keep you updated with the latest additions or removals of any entity from the list and consequently produces zero false positive results.
