The Essence of Customer Due Diligence in one annoying song
We all love money. I know it’s a bit of a platitude, but in the case of Customer Due Diligence there just is no denying it. Organisations need to love and protect their (our?!) money or else it will be taken from them by those who won’t treat it well (use it for fraud or money laundering schemes), and in punishment by those who oversee the handling and protecting of money. Risk and fines, we can all do without those and yet they are part of our world.
But in fact protecting our company against risks in compliance with (European) law costs us money too. A lot, actually. So if we love money, and more money means more love, how can we make more or spend less? Research (and one quick round on LinkedIn) tells us that the most pressing CDD-issue companies are struggling to solve is not the risk itself, nor the possible governmental fines; it is the labour-intensive manual checking of possible matches against sanction lists.
The pragmatic approach to this problem of course would be to either reduce the number of possible matches (preferably by increasing the number of certain matches), or by somehow making the manual checking less labour-intensive.
So what if there would be a solution that could do both?
With a good CDD policy founded on an innovative CDD-solution, any organisation can do more than simply guarantee honest business practice and prevent risk. If we approach CDD as an opportunity rather than a necessity, it can provide us with four important benefits:
- Combatting of specific integrity risks such as financing of terrorism and money laundering
- Safeguarding integrity and reputation in the market
- Considerable cost savings (up to 90% less manual checking of possible matches)
- An integrated customer profile for optimal customer interaction and insight into cross- and upselling
High Precision Matching: knowing who you have in front of you
To maintain the trust of your market, your business practice must be transparent and free of fraudulent transactions. This is only possible if you yourself can rely on the insight into your data. This means you must be able to rely on a matching method which actually works just like the human brain: through a combination of probabilistic and deterministic matching methods which ensure that patterns are identified and data correctly matched. The foundation for successful matching is what we call High Precision Matching. By means of automatic checks based on phonetic and semantic characteristics in combination with the characterization (“word image”), the software gives every record a score indicating how likely it is that this record relates to a fraudulent person or organisation. In order to form an accurate and reliable opinion, it is necessary to include information regarding names, prefixes, shortenings, double meanings and combinations.
The combination of all these comparison methods ultimately ensures a high degree of reliability in the results, which are also quickly generated and don’t require much revision work. So you save a considerable amount in costs and time! With High Precision Matching you will receive:
- automatic checks
- fast results: fast onboarding
- a high degree of reliability
- time and cost savings: little manual verification
- fewer false positives: customer-friendly process
- fewer false negatives: lower risk for the organisation
So the radio was right this morning when it played that annoying song. It is all ‘bout the money. And High Precision matching. And something about dumbdadadada dumb…
