LinkedIn

Eight Reasons Why Search Engines Are Not Due Diligence

2018-October-11

Search engines are free, easy to use and powerful. Could you use them to run a KYC/AML screening program? You could – but in the end, it will expose you to significantly more cost and risk than opting for a purpose-build solution. Here are eight reasons why.

1. Data from Search Engines is Unstructured

Search engines return stories and URL links, when what you ideally need are consolidated profiles, with secondary identifiers such as age, location and connections organized for easy review. Sometimes, you’ll need content from multiple stories to make an onboarding decision.

2. Search is Inefficient

First, you get pages and pages of results, many of which are not relevant. Second, there’s a lot of duplication, since high-priority stories are often syndicated and therefore repeated many times. This creates huge volumes of false-positives that analysts must research. Finally, search engines do not allow for daily or periodic review of adverse media, creating even more work for analyst teams. The result is tremendous inefficiency and excessive compliance costs.

3. Search Engines are Biased

Search Engine Optimization (SEO) can manipulate the results that are returned in a single search, pushing certain topics to the top of a search or others to the bottom. Search results are also influenced by users’ locations, what they have searched for previously. This means inconsistent review across different analysts and makes it much harder to identify risks efficiently.

4. Important Intelligence is Missing

As publishers move content behind paywalls/subscription controls, it’s only indexed on search engines, which don’t provide the full reference or story. Content is also sometimes archived and removed from search indexes over time. All of this can result in ‘missing’, risk-relevant content that may be critical to due diligence decisions.

5. A Search Engine’s Priorities are Not Your Priorities

Search engines prioritize news based on the popularity of the story or source. This has no relevance to your rules and priorities around due diligence.

6. How Do You Know it’s Not Fake News?

Search algorithms are confidential. But they all essentially prioritize news based on clicks and indexing, not on the integrity of sources. For adverse media, this means that stories from anonymous or unknown authors or people of questionable integrity are placed alongside valid sources. Again, this makes it harder to find truly risk-relevant information.

7. You Can’t Audit a Search Engine

Because search results are constantly updated, the same search carried out just minutes later can return different results. This creates complications for quality control, regulatory reviews, and decision-making. There is also no way to track a profile at a point in time and store those results for future audit needs.

8. Monitoring Becomes Your Problem

Due diligence doesn’t end when business relationships begin. Any customer or partner could become involved in activities that conflict with your compliance policies and rules, putting your organization at risk. Organizations relying on search engines are forced to screen either once a year or take a segmentation approach, only re-screening the highest-risk individuals. Both these methods are inefficient and can leave you exposed.

So what’s the answer?

Don’t rely on search engines for due diligence. RDC’s solution, for example, overcomes all of their limitations. It is:

Structured – we aggregate, curate and index data, and stored as profiles for efficient searching and filtering

Efficient– machines do the hard work, with AI-based name matching reducing false positives by up to 90%

Unbiased – consistent filtering and prioritization algorithms eliminate subjectivity and search engine biases.

Complete – we collect data from more than 200,000 reputable sources, with a full audit trail

Prioritized – we remove “popularity bias” to focus exclusively on risk-relevance

Credible – “fake news” is eliminated using source validation, NLP technology and expert curation

Auditable – RDC’s data and screening platform delivers consistent, documented and auditable results

Monitored – your portfolio can be automatically monitored every day with no extra work for compliance staff.

 

18

December

2018

Making Negative News a Positive for FinTech Companies

By Joel Cope | December 18, 2018 Adverse media, or negative news, is an important component in the anti-money laundering […]

View more
11

December

2018

Customer Screening is the DIY Project From Hell

By Michael Kerman | December 11, 2018 Every year, without fail, many banks and financial institutions embark on internal projects […]

View more
03

December

2018

Improving the Impact of Adverse Media Screening for Fintech Companies

Adverse media screening has been widely adopted by UK fintech companies as part of their AML compliance programmes. But where […]

View more
30

November

2018

Protective Scrutiny: The Role of Customer Screening in the Modern Customer Identification Program

This paper builds on our previous whitepaper, “Financial Crime: Can We Win the War?” and drills into customer screening and […]

View more
29

November

2018

Financial Crime: Can We Win the War?

The problem of financial crime is not a new one, but it is larger and more pervasive than most people […]

View more

RDC a Leader in IDC’s KYC Marketscape

RDC has been named as a “Leader” in IDC MarketScape: Worldwide Know-Your-Customer Solutions in Financial Services 2018 Vendor Assessment.

View more
01

November

2018

Using Natural Language Processing to Interpret Risk-Relevant Content

Explore the world of natural language processing (NLP), a fast-evolving technology that’s ideally suited to making sense of unstructured risk intelligence data at […]

View more
29

October

2018

RegTech – Not Just for Startups

By Michael Kerman | October 29, 2018 After the 2008 crisis, financial institutions faced a mountain of new regulations and […]

View more