The Frustrations of Ineffective Watchlist Solutions

By Cognito Team on May 26, 2020

If you’re looking to boost your customer due diligence (CDD), there are a number of watchlist solutions on the market. But not all watchlist solutions are created equal. Substandard watchlist products can generate false positives, force you to manually re-scan thousands of users, and introduce friction into the customer sign-up process. As a result, your compliance program could suffer major setbacks — and a less-than-stellar customer experience could affect your bottom line. 

Compliance teams at high-growth companies can’t afford to deal with costly and time-consuming incompetencies. With that in mind, here are five common frustrations that compliance professionals run into when implementing a CDD solution and how the right watchlist product can solve them.

1. Manually re-scanning users takes time

CDD is an ongoing process that requires an automated watchlist solution, especially if you’re scaling for growth. Lesser watchlist solutions force you to manually re-scan thousands or even millions of users on a regular basis, placing an unnecessary burden on your compliance team. If a bad actor slips through the cracks, your company could face steep regulatory penalties and reputational damage. 

Cognito’s complete compliance CRM lightens this burden for you by automatically re-screening hundreds of millions of users per month. This way, you can quickly catch any changes in the status of your customers and take the appropriate action.

2. False positives send your compliance team down the wrong path

According to NASDAQ — and what we’ve heard from our own customers — false positives are a growing concern for compliance professionals. When false positives show up in your watchlist queue, your team has to spend valuable time investigating and resolving them — time that could be better spent following up on genuine positives or improving your overall compliance program. Inadequate watchlist solutions generate false positives and even false negatives, raising questions about your compliance effectiveness. 

Fortunately, Cognito features industry-leading search algorithms that eliminate this common complaint. By taking into account the day-to-day edge cases that occur with watchlist databases and user inputs, Cognito’s search technology provides a reliable and comprehensive list of potential matches for your customers.

3. Limited or unregulated databases paint an incomplete picture

Some watchlist solutions offer a small selection of databases or rely primarily on unregulated sources, giving you only a partial or incomplete picture of a potential customer. This makes your job harder than it needs to be, hampering the effectiveness of your compliance program. 

Cognito’s databases are extensive and accurate, allowing you to better understand the quality and likelihood of a match. By automatically tapping a wide array of databases across the globe and using data normalization that extracts more information than just names, Cognito gives you greater confidence in your compliance process.

4. Monitoring the compliance process is fragmented and complex 

If you don’t know where your customers are in the compliance process, you’re essentially flying blind — and that’s a position no leader should have to be in. Yet many solutions don’t actually give you a unified view of your compliance process. If they don’t integrate with your other software tools, that makes it even harder for you to make sure your CDD is on track. 

By comparison, Cognito gives you a comprehensive, real-time view of your compliance program. You can track your customers throughout their sign-up process and even visualize and triage cases with an intuitive interface and detailed audit trails. Cognito’s workflow APIs let you integrate your compliance tools, allowing for fine-tuned and automated management. 

5. Friction in the onboarding process frustrates your customers

A smooth onboarding process is critical to customer satisfaction. However, ineffective watchlist solutions can cause friction by requiring customers to provide large quantities of information up front. This increases the odds that customers will abandon the process or sign up with a competitor instead. 

A robust compliance program doesn’t have to be at odds with a high-quality customer experience. Cognito’s watchlist gradually verifies your customers behind the scenes, helping you screen new users without making them jump through too many hoops. It then gradually fills out their profiles in the background, helping you screen customers every step of the way.

Find a watchlist solution that does it all

Ineffective watchlist solutions can introduce hurdles to your compliance program, flagging false positives that send you down a rabbit hole and creating friction in the experience that slows down customer acquisition. With the right watchlist in your corner, you can strengthen your customer due diligence and clear the way for unimpeded business growth. 

Protect your business with a watchlist solution that offers complete peace of mind. To learn more, get in touch — we’re here to answer your questions.

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