"The future of entity due diligence" – and the part Orbis can play

"The world has gone through an incredible amount of technological transformation over the past ten years. While it may seem hard to imagine that change will continue at this pace, it's not only likely to continue, but it will accelerate. There are various functional areas within institutions that support global commerce, but some have been laggards in adopting new technology for a plethora of reasons."

So says Keith Furst, financial crime expert and founder of Data Derivatives, at the start of The Future of entity due diligence, an ambitiously thorough new article on his website. It's a long but important read from the occasional Bureau van Dijk collaborator, who's written about beneficial ownership for our blog and contributed to some of our recent webinars on demand.

That things will accelerate is a bold claim. But Keith goes on to lay out a convincing case, focusing on topics such as:

• The evolution of criminals and terrorists, and the reaction from law enforcement
• Regulatory drivers, including FinCEN's all-important customer due diligence (CDD) final rule
• Digital transformation, including alternative data and non-documentary evidence
• Emerging risks
• Technology and innovation

It's Keith's take on FinCEN's CDD final rule that really resonates with us.

"While US banks would be in compliance with the rule if they simply collected beneficial ownership based on what their customers supplied, it may not accurate all of the time," writes Keith. "This is why it would be prudent for a financial institution to collect beneficial ownership from the client, and also use a third-party data source such as Bureau van Dijk's Orbis as another method of coverage and verification."

He adds: "If there was a gap between what the customer provided and what Orbis has then it could be a factor to consider when determining which customers should undergo enhanced due diligence."

Keith finishes his article with a series of eight recommendations for practitioners. Building on ideas discussed at the end of the Channeling big data through RegTech webinar on which he was a panellist, his central advice is to "start today to future-proof your due diligence program".

Read the article in full on his website. It's also available as a downloadable PDF.

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