Sanctions false positives and real exposure
Aggressive matching without disciplined disposition creates backlog risk. Weak matching creates the opposite problem—missed hits. Both show up in audits.
Sanctions audits are not only about list providers. Matching logic, update cadence, and how analysts clear possible matches determine whether exposure is real or merely noisy. We sample cleared hits and ask whether the rationale would survive a cold reviewer.
Pay special attention to directors, UBOs, and payee screening—not only primary customers. Intermediaries and beneficiaries are where fintech payment flows often under-screen.
When thresholds are loosened to clear backlog, record the risk acceptance. Silent threshold changes look like control failures during partner diligence.
Keep evidence of list versions used on decision dates. Partners ask; “we use a leading provider” is not an answer.