How do you do adverse media screening?

How do you do adverse media screening?

Institutions use internet searches , “googling” news articles to perform manual searches for negative news on each individual high-risk client. Then, compliance staff must review these potential matches to determine whether the person named in media stories is actually the individual they are investigating.

How are adverse information searches conducted?

How to manually search for negative news? The most common way to manually search for negative news related to a client is to input the person’s or the company’s name (or acronym) in a search engine. Various search engines, such as Google, offer a feature where one can explore solely news articles.

What is adverse media check?

As the name implies, negative news or adverse media is defined as any negative information on the customer, discovered across various sources. Adverse media check can expose an individual’s or an organisation’s involvement in money laundering, terror financing, financial fraud, and other criminal activity.

What is adverse media in AML?

Share. Share. Adverse Media or negative news is any bad and negative information about the customer or business discovered in various sources, and this information can also expose someone to be involved in crime.

What is enhanced due diligence checklist?

Enhanced Due Diligence Procedures

• ‍Step 1: Start with a Risk-Based Approach.
• Step 2: Source for recognizing Information.
• Step 3: Analyze the Source of Funds and Ultimate Beneficial Ownership (UBO)
• Step 4: Ongoing Transactions Monitoring.
• Step 5: Adverse Media and Negative Check.
• Step 6: Conduct an On-site Visit.

Why is adverse media checks conducted?

Adverse media screening is an crucial part of any customer due diligence process as missing an important piece of information could have significant consequences, particularly from a regulatory compliance perspective.

How does KYC identify PEP?

FATF Recommendation 12 defines a PEP is an individual who is or has been entrusted with prominent public functions either domestically or abroad, such as, for example, a head of state or senior politician. The PEP list also includes close business associates and family members.

What is PEP and non PEP?

A person is not considered a PEP once they leave their high-profile position, but they may still be high risk. Former PEPs can pose a money laundering or terrorism financing risk to your business or organisation, especially if they were high-risk PEPs.

Do you need to perform adverse media searches under AML?

The Risk Factors Guidelines under the EU’s 4th AML directive outline the need for legal entities to perform adverse media searches as part of the Enhanced Due Diligence process for high-risk customers. Adverse media searches should also be applied when increasing the quantity of information obtained for CDD purposes.

What is adverse media screening and how does it work?

Adverse media screening is associated with monitoring for negative news and reputational risks on a person or business as part of a company’s onboarding, KYC and AML process. The screening can be conducted manually which is usually more time-consuming and yields limited results or batch screening technology can be applied.

What is the legislation behind adverse media searches?

What is the legislation behind adverse media? In the international sphere, the Financial Action Task Force (FATF) in its Risk-Based Approach Guidance identifies adverse media searches as a part of Enhanced Due Diligence (EDD) practice concerning individual customer risk assessment.

How effective are manual negative media checks?

As mentioned above, manual negative media checks have limited effectiveness and are time-consuming, especially when running a fast-growing business with a strong inflow of new customers or a business having multiple partners worldwide.