Adverse Media Screening

Screen customers against global news sources to detect negative coverage related to financial crime, fraud, corruption, sanctions violations, and regulatory enforcement actions.

What is Adverse Media?

Adverse media (also called "negative news") refers to publicly available information from credible sources about an individual or entity's involvement in:

• Money laundering
• Fraud and financial crime
• Corruption and bribery
• Regulatory enforcement actions
• Sanctions violations
• Terrorism financing
• Human rights violations
• Organised crime

3 Credits Per adverse media screening

Why Screen Adverse Media?

Detect Hidden Risks

Individuals Not on Sanctions Lists:

• Under investigation but not yet sanctioned
• Indicted but trial ongoing
• Convicted but not yet on watchlists
• Associates of sanctioned individuals

Corporate Risks:

• Companies under investigation
• Regulatory enforcement actions
• Fraud allegations
• Executive misconduct

Regulatory Requirements

FATF Guidance: Recommends adverse media screening as part of customer due diligence, particularly for:

• Politically Exposed Persons (PEPs)
• High-risk customers
• Complex or unusual transactions

6AMLD (EU): Enhanced due diligence requirements include adverse media checks for high-risk scenarios.

News Sources (15 Sources)

Global News Agencies

• Reuters - International news wire
• Associated Press (AP) - Global news network
• Bloomberg - Financial news and analysis
• Financial Times - Business and economic news
• The Wall Street Journal - Finance and business

Regional Sources

• BBC News - UK and international
• The Guardian - UK investigative journalism
• The New York Times - US national news
• Le Monde - French and European
• Der Spiegel - German investigative journalism

Specialised Sources

• OCCRP (Organised Crime and Corruption Reporting Project)
• ICIJ (International Consortium of Investigative Journalists)
• Transparency International - Corruption reports
• Regulatory Websites - SEC, FCA, FinCEN, OFAC announcements
• Court Records - Public court filings and judgments

How It Works

Search Process

const search = await fetch('/api/v3/aml/search', {
  method: 'POST',
  body: JSON.stringify({
    fullName: 'John Michael Smith',
    country: 'US',
    categories: ['adverse_media'],
    dateRange: {
      from: '2010-01-01', // Search from this date
      to: '2024-12-31'
    },
    relevanceThreshold: 70 // 0-100, higher = more selective
  })
});

Results

{
  "totalArticles": 12,
  "relevantArticles": 3,
  "articles": [
    {
      "matchScore": 92,
      "relevanceScore": 85,
      "title": "Former Bank Executive Charged with Fraud",
      "source": "Financial Times",
      "date": "2022-06-15",
      "url": "https://ft.com/article/...",
      "excerpt": "John Michael Smith, 47, former CFO of Example Bank, has been charged with wire fraud and money laundering...",
      "topics": ["fraud", "money_laundering", "regulatory_action"],
      "sentiment": "negative",
      "entities": [
        { "name": "John Michael Smith", "type": "person" },
        { "name": "Example Bank", "type": "organisation" }
      ]
    },
    {
      "matchScore": 88,
      "relevanceScore": 78,
      "title": "SEC Investigates Trading Irregularities",
      "source": "Bloomberg",
      "date": "2021-03-10",
      "excerpt": "The SEC has opened an investigation into trading patterns at Example Bank, where John Smith served as CFO...",
      "topics": ["regulatory_investigation", "securities_fraud"]
    }
  ],
  "riskAssessment": "high",
  "recommendation": "enhanced_due_diligence"
}

Relevance Scoring

Not all news mentions are adverse. VeriPlus uses AI to filter:

Relevance Factors

Score Interpretation

Example of Low Relevance:

• Person shares common name with someone in unrelated article
• Mentioned as victim of crime (not perpetrator)
• Mentioned in positive context (charity work, awards)

Adverse Media Categories

Financial Crime

Money Laundering:

• Structuring/smurfing
• Trade-based money laundering
• Virtual currency laundering
• Shell companies

Fraud:

• Wire fraud
• Securities fraud
• Insurance fraud
• Mortgage fraud
• Tax evasion

Corruption

Bribery:

• Foreign Corrupt Practices Act (FCPA) violations
• Commercial bribery
• Kickbacks

Embezzlement:

• Misappropriation of funds
• Asset theft
• Insider trading

Regulatory Enforcement

Civil Actions:

• SEC enforcement
• FinCEN penalties
• FCA disciplinary actions
• OFAC violations

Criminal Charges:

• Indictments
• Convictions
• Guilty pleas

Organised Crime

• Racketeering (RICO)
• Drug trafficking
• Human trafficking
• Arms smuggling

Terrorism Financing

• Material support to terrorist organisations
• Fundraising for terrorism
• Terrorist entity associations

Human Rights Violations

• War crimes
• Crimes against humanity
• Modern slavery
• Environmental crimes

Time Periods

Current vs. Historical

Recent (0-2 years):

• Highest risk
• Likely ongoing investigation or trial
• Most relevant for current risk assessment

Medium-Term (2-5 years):

• Still relevant
• May be resolved or ongoing
• Check for updates

Historical (5+ years):

• Lower priority unless very serious
• Check if matter resolved
• Consider rehabilitation period

Date Range Configuration

// Last 5 years only (recommended)
{
  "dateRange": {
    "from": "2019-01-01",
    "to": "2024-12-31"
  }
}
 
// All available history
{
  "dateRange": {
    "from": null, // No start date
    "to": null // Current date
  }
}
 
// Since specific event
{
  "dateRange": {
    "from": "2020-03-15", // Start of pandemic
    "to": "2024-12-31"
  }
}

Risk Assessment

Risk Levels

Critical: Immediate action required

• Ongoing criminal trial
• Recent sanctions violation
• Active regulatory investigation

High: Enhanced due diligence required

• Conviction in past 2 years
• Regulatory penalty issued
• Corruption allegations

Medium: Manual review recommended

• Historical conviction (3-5 years ago)
• Settled regulatory matter
• Association with adverse entity

Low: Note and monitor

• Old matters (5+ years)
• Resolved cases
• Tangential mentions

Contextual Analysis

Important Factors:

1. Role in Event:

   • Principal actor (high risk)
   • Associate (medium risk)
   • Witness (low risk)
   • Victim (no risk)

2. Resolution Status:

   • Convicted (high risk)
   • Indicted, trial pending (high risk)
   • Under investigation (medium risk)
   • Acquitted (low risk, but note)
   • Settled without admission (medium risk)

3. Recency:

   • Active/ongoing (highest risk)
   • Recent conclusion (high risk)
   • Several years old (medium risk)
   • Decades old (low risk)

4. Severity:

   • Sanctions violation (critical)
   • Fraud >$1M (high)
   • Regulatory fine (medium)
   • Misdemeanor (low)

False Positives

Common Causes

Name Confusion:

• Common names (e.g., "John Smith")
• Similar names in same industry
• Family members with same name

Irrelevant Mentions:

• Person quoted as expert
• Mentioned as victim
• Employee of company in news (but not involved)
• Different person in different country

Investigation Process

1. Review Full Article: Read complete article, not just excerpt
2. Cross-Reference: Check multiple sources
3. Verify Identity: Match DOB, location, occupation
4. Check Context: Understand person's role in event
5. Document Decision: Explain why you dismissed or confirmed

await fetch(`/api/v3/aml/searches/${searchId}/review-article`, {
  method: 'POST',
  body: JSON.stringify({
    articleId: 'art_abc123',
    decision: 'false_positive', // or 'true_positive'
    reason: 'Different John Smith - article refers to person in Australia, our customer is in UK',
    reviewedBy: 'compliance_officer_id'
  })
});

Combining with Other Checks

Comprehensive AML Screening

const search = await fetch('/api/v3/aml/search', {
  method: 'POST',
  body: JSON.stringify({
    fullName: 'John Michael Smith',
    dateOfBirth: '1975-03-15',
    country: 'US',
    categories: ['sanctions', 'pep', 'adverse_media'], // All three
    matchThreshold: 85
  })
});

5 Credits Per comprehensive AML screening (all categories)

Results:

{
  "sanctionsHits": 0,
  "pepHits": 0,
  "adverseMediaHits": 2,
  "overallRisk": "medium",
  "recommendation": "manual_review",
  "reasons": [
    "Adverse media: Regulatory investigation (2021)",
    "Adverse media: Civil lawsuit (2022)"
  ]
}

Ongoing Monitoring

Enable continuous adverse media monitoring:

await fetch(`/api/v3/applicants/${applicantId}/enable-monitoring`, {
  method: 'POST',
  body: JSON.stringify({
    frequency: 'daily',
    categories: ['adverse_media'],
    alertThreshold: 70
  })
});

Alerts:

{
  "event": "aml.alert.adverse_media",
  "applicantId": "app_abc123",
  "date": "2024-01-15",
  "article": {
    "title": "Former CFO Indicted on Fraud Charges",
    "source": "Reuters",
    "date": "2024-01-14",
    "relevanceScore": 95
  },
  "action": "review_required"
}

See AML Monitoring for details.

Best Practices

1. Use for high-risk customers - PEPs, large transactions, high-risk countries
2. Set appropriate relevance threshold - 70%+ to avoid noise
3. Limit date range - Last 5-10 years usually sufficient
4. Read full articles - Don't rely only on excerpts
5. Document review - Explain why you dismissed or confirmed
6. Re-screen periodically - New articles appear regularly
7. Combine with PEP/sanctions - Comprehensive risk assessment
8. Train reviewers - Understanding context is critical

Limitations

Coverage Gaps

• Local News: Non-English sources may have limited coverage
• Timing: There's a delay between event and news publication
• Privacy Laws: Some jurisdictions restrict publishing names

Accuracy Challenges

• Name Matching: Common names produce many false positives
• AI Relevance: Automated scoring not perfect, human review needed
• Source Bias: Some sources more sensational than others

Recommendations

• Don't auto-reject based solely on adverse media
• Always investigate matches manually
• Consider source credibility
• Look for corroboration across multiple sources
• Check if matter was resolved

Regulatory Guidance

FATF Recommendations

Adverse media checks recommended for:

• Customer due diligence
• Enhanced due diligence (PEPs, high-risk)
• Ongoing monitoring
• Transaction monitoring

EU 6AMLD

Article 13: Enhanced customer due diligence includes:

• Information on reputation
• Publicly available information (adverse media)

UK Money Laundering Regulations 2017

Regulation 35: Enhanced due diligence must consider:

• Information from credible sources
• Negative news media
• Internet searches

Cost Optimization

Strategies:

1. Risk-Based: Only run for customers meeting risk criteria
2. Combine Checks: Run with PEP/sanctions in single search
3. Limit Date Range: 5 years vs. all history
4. Threshold Tuning: Higher relevance threshold = fewer results to review
5. Monitoring: Enable for high-risk only, disable when risk decreases

Next Steps