What is watchlist management?
Watchlist management refers to the organization and updating of all watchlist data that is required for financial institutions to abide by global government and central bank regulations. This data is primarily used during name screening and transaction screening processes. Watch List Management (WLM) can also refer to the combination of name and transaction screening as part of sanctions screening.
What is a watchlist?
A watchlist is a catch-all term for a variety of different lists a financial institution may use in the screening process. These include official sanctions lists issued by governments, law enforcement agencies, regulators, and central banks that feature names of sanctioned individuals and organizations.
Names on these lists may have been sanctioned for a variety of reasons including people trafficking, money laundering, and terrorism.
Alongside these lists might be private lists circulated to specific organizations, commercial lists that include PEP and adverse media coverage, and internal lists that have been created by a financial institution according to their risk profile.
Watchlist examples
There are many watchlists around the world, from sanctions lists to PEP lists and wanted lists. Major lists to be aware of include:
- The United Nations Security Council (UNSC) – Consolidated Sanctions List
- US – Consolidated Sanctions List
- US – Office of Foreign Assets Control (OFAC) Specially Designated Nationals
- Canada – Consolidated Canadian Autonomous Sanctions List
- US – Bureau of Industry and Security Sanctions List
- US – Department of State, AECA Debarred List
- US – Department of State, Non-proliferation Sanctions List (US)
- European Union (EU) Financial Sanctions List
- UK Sanctions List
- Australia – Consolidated Sanctions List
- France – Registre National Des Gels List
- European External Action Service Consolidated List
- US – CIA World Leaders PEP List
- World Presidents PEP List
- Council of Europe Assembly PEP List
- Every Politician PEP List
- Switzerland Consolidated Sanctions / Embargos List
- Capital Market Board of Turkey Operation Banned List
- Interpol Red Wanted List
- Interpol Yellow Wanted List
- Interpol UN Wanted List
Are watchlists updated regularly?
Watchlists should be updated regularly as part of effective watchlist management. This is because agencies often update their lists, and a financial institution needs to be proactive if they wish to stay ahead of regulations.
A bank can abide by these regulations through effective sanctions screening – name screening and transaction screening – and customer due diligence (CDD) processes.
What are the challenges of watchlist management?
There are a number of challenges in watchlist management. These include:
- The number of lists – because there are so many lists, it can be a complex process to keep up to date and import all the data available.
- Out-of-date data – a financial institution may be unaware that some of the data they are pulling into their full watchlist has expired, resulting in an increase of false positives.
- Poor quality or incomplete data – making it harder to accurately screen individuals and businesses
- Duplication between lists – leading to duplicated alerts
Many of these challenges can often be overcome by using specialized third-party watchlist management software such as SymphonyAI’s NetReveal Sanctions Screening.
What are the benefits of watchlist management?
Effective watchlist management enables:
- Improved sanctions screening – encompassing name screening and transaction screening;
- Enhanced compliance – with constantly changing laws and regulations;
- Reduced risk – a financial institution can be more confident in their sanctions screening processes;
- Decrease in fines or legal liabilities – owing to aforementioned enhanced due diligence processes.
By managing watchlists successfully, a financial institution’s due diligence processes also improve, leading to enhanced productivity in the areas that matter, a greater confidence in technology and software across the company, and enhanced trust with regulators.
SymphonyAI offers advanced watchlist management capabilities
Guard against reputational and financial risks with advanced, context-aware capabilities that reduce false positives and reveal bad actors appearing on any watchlist.
Context-aware algorithmic extensions improve match sensitivity and examine names intelligently. False positives are further reduced through SymphonyAI’s Intelligent Event Triage (IET) capability which looks beyond pure name matches to provide an additional layer of detection that sorts and prioritises matches and alerts. Synonyms and weighted words further increase detection accuracy. Associated lists of words (nicknames, similar terms, financial terms) detect more variance and focus on what is important (weights).
Learn more about SymphonyAI’s NetReveal Sanction Screening tools, which includes name screening and transaction screening.
Discover SensaAI for Sanctions
SymphonyAI also offers SensaAI for Sanctions. Augment your existing detection solutions to dramatically enhance matching capabilities with gen AI and predictive AI that analyzes and structures previously unstructured text and significantly reduces false positives. The result is a real-time AI upgrade for screening with a seamless, streamlined process.
Learn more about SensaAI for Sanctions.
