Adverse media or any negative news is any information that exposes a person’s involvement in crimes, however, in AML compliance, adverse media refers to risk-relevant information that is available to the general public. This adverse information could be news of involvement in money laundering, financing terrorism, fraud, tax evasion, human rights abuse, and so on.
Adverse information search: sources of risk-relevant data
- Media. Most of the risk-related information is found from conventional news sources like newspapers. Thousands of financial crime-related negative news appear every day. As a result, negative news searching can consume a lot of resources, but with automation, it’s a breeze.
- Designated websites. Like Yelp and TripAdvisor, there are websites dedicated to reporting issues involving corruption, fraud, and other adverse information. A good example of such a website is the Better Business Bureau (BBB).
- Sanctions Lists. Being listed on a sanction list means that a company is fraudulent or has shady operations. Major sanctions lists include OFAC sanctions lists, UN consolidated lists, EU consolidated lists, and so on. In AML compliance, sanctions lists screening are compulsory for proper customer due diligence.
- Regulatory Filings and Databases. Financial authorities including the US SEC and FinRA regularly release press on disciplinary actions against offending entities. Most countries and regions like the US have websites dedicated to searching for entities involved in a disciplinary/regulatory action. All it takes to find them is a simple search on any search engine.
- Independent anti-corruption sources. Independent investigators often uncover major corruption and fraud cases that involve governments, corporations, and individuals. An example is the Panama paper publication issued by the International Consortium of Investigative Journalists. Other sources include Wikileaks, and Transparency International’s “Corruption Perception Index”.
- International Databases. Interpol Wanted Persons list is a good example of an international database.
Using software for negative news search
Thousands of negative news are published in different languages daily, consequently posing a challenge to a manual screening for risk-relevant information, particularly in companies dealing with large numbers of customers every day. Our automated platform for adverse media searching presents a solution to these challenges.
Automated media analysis in several local languages, millions of web pages and thousands of sources analyzed in minutes—Sumsub offers a reliable solution to protect businesses from unwanted connections and fraud.