The handling of false positives is an important issue that is often raised by companies subject to regulation. Why?
Even if they have dedicated compliance teams, remediation tasks are often considered too time-consuming, repetitive, and low-value for people who are generally skilled and not inclined to do production work.
For companies that entrust due diligence to operational staff within their organization who are not experienced in compliance—whether they are buyers, salespeople, communicators, or CSR experts—the challenge is to teach them how to do it. A culture of change and motivation!
So regardless of the organization, relieving users of this task of processing false positives is a real thorny issue.
Optimize the screening solution
Each solution seeks to improve in order to limit false positives.
At ELLISPHERE, we bring together all ELLISPHERE KYB data on companies on a single platform, which we aggregate with data from screening partners. You are probably familiar with some of them, such as LSEG, LEXIS NEXIS, DOW JONES, and ACURIS.
First challenge: correctly configuring the call that generates the correspondence.
You can also play around with the matching percentage offered by the platform to set what you consider acceptable based on your risk tolerance.
For example, our customers choose a 90% match rate, but some who want to limit false positives even increase it to 95%. Avoid 100% matching, which limits false positives but exposes you to missing out on critical, useful information.
Acuris, our main partner, is already working to ensure that the database is as comprehensive as possible.
On our side, we can also add an extra layer of functionality to automatically eliminate false positives or facilitate processing, for example by highlighting common identifiers in the PTF. In concrete terms, we can perform an automatic match when there is an indisputable common identifier, such as a SIREN number. This is what we do in Compliance For Business.
Delegate the remediation task
Another solution to remove this thorn from your side is to delegate the task by removing it from operational staff.
This certainly comes at a cost, but it must be weighed against the time saved and the motivation of the operational teams.
This task must then be isolated and carried out by a qualified subcontractor who will produce the remedies based on a specific procedure to distinguish between what is false and what is true, or even—after analysis—what is possible.
At ELLISPHERE, we have clearly identified this need and are currently offering this service to our customers to relieve them of these time-consuming tasks, both in terms of their inventory and their workflow.
We then act as a partner to our client on part of the due diligence process by providing shared qualified personnel for all our clients subject to this requirement.
It is important to note that this in no way detracts from the ability of operational staff to create assessments, qualify their third parties, provide information about their third parties, assess risk, mitigate it, and make decisions.
If you decide to leave these tasks to operational staff, it is recommended that you implement a written procedure for handling false positives that will evolve over time and serve as a guide for harmonizing the process. You may also decide to transfer the most complex tasks to a Level 2 team. It should be noted that this procedure is essential in the case of outsourcing.
