Compare Transactions against Sanction Lists Before Execution

LGT Bank in Liechtenstein and Banca del Gottardo (CH) check incoming and outgoing payments for persons, banks and countries associated with risk.
(PresseBox) (Immenstaad (Germany), ) Unusual transactions are identified by the fact that they include originator or recipient data that appear in sanction lists, for example. Name Matching Transaction software from Innovations Software Technology compares originator, recipient and booking information against entries in sanction lists such as World Check or EU lists. When an unusual transaction is identified, it is held up until those issues are clarified. LGT Bank in Liechtenstein and Banca del Gottardo in Lugano, Switzerland, have chosen this Name Matching Transaction solution to enhance their compliance environment.

Ivo Klein, Head of Group Compliance at LGT Bank in Liechtenstein, outlined three overriding reasons to monitor incoming and outgoing payments: compliance with statutory requirements (such as economic embargoes of the government of Liechtenstein), combating terrorism financing, and minimizing money laundering, and through all this protecting the bank's reputation. This also means that undesired funds are rejected, such as those from countries without functioning legal systems. Using Name Matching Transaction software, the bank checks all transactions, regardless of amount, for information connected to data on sanction lists, such as booking texts, initiator or recipient. "One critical reason to implement this software solution in our institution was its white-listing function. This allows us to define known names, booking texts or banks that should not be reported as hits when checking payment transactions. This function reduces 'false positives,' that is, hits that don't represent any risk, which means we can concentrate on the really relevant cases. We were also interested in the option of entering country limits, which prevents the automatic execution of transaction to countries that are subject to economic sanctions or Non-Cooperative Countries or Territories (NCCT) of the FATF,“ Ivo Klein explained.

The Banca del Gottardo, a private bank with registered offices in Lugano, Switzerland, chose Name Matching Transaction and recently adopted it in their operations. This solution enables the bank to compare names, booking texts, BICs, countries and transaction volumes with data from an external sanctions list and information from the bank's internal black list. When the system identifies suspicious persons and transactions—whether domestic or foreign—those transactions are blocked until they can be reviewed and released. The processing and release functions are executed right within the Name Matching Transaction software. Each processing step is recorded to ensure auditability.

Matteo Fossati, the Compliance Monitoring manager responsible for this project, summarized their experience: "We implemented the Name Matching Transaction solution in a six-week test phase to review our payment transactions before we adopted it. We never expected the project to be launched as quickly and smoothly as it was.“

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