By Yasir Ahmed, Account Manager, Global Trade Intelligence, Descartes Systems Group 

Let’s be clear. A denied party screening solutions provider is more than just a vendor. They should be seen as a critical partner with a significant role to play in protecting your organization.

That is because the key objective of this category of vendors is to help you minimize sanctions compliance risks 24/7, day-in and day-out.

But while sanctions screening solutions providers can look and feel similar, subtle distinctions can make a world of difference in the integrity and effectiveness of your screening program.  

With high regulatory demands and an increasingly complex sanction compliance landscape, choosing the best denied party screening software vendor, is therefore, vital. Below is a guide to help you spot key warning signs and avoid performance risks in the restricted party screening process.  

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Top 5 Red Flags to watch out for in a Denied Party Screening Software Solutions Vendor 

ONE: Irrelevant Sanctions Lists 

Sanctions evolve and change frequently, with programs being added and removed throughout the year across the globe. Ensuring that the sanctions lists you purchase are active, current, and relevant to your business is essential to optimizing your denied party screening and managing the rate of false positive / false negative results. Here are some red flags to look out for:  

  • The provider has obsolete sanctions lists in their product offerings that are part of a paid subscription.  
  • The denied party screening provider is missing sanction programs relevant to your specific market or industry. For example, a provider offers a Canadian company the U.S./UN sanction lists but has no autonomous Canadian sanction program.  
  • The provider has redundancy in their sanction list offerings. For example, a list of the United Nations sanctions for each member country that follows the UN Security Council resolutions.   

TWO: Poor Timeliness and Accuracy of Updates  

The delivery of the sanctioned or denied party screening data is the most important component of a screening program. Are updates to sanctions lists published in a timely manner and with accuracy? How soon after a new denied party list is announced is it available for you to screen against?  Since these questions are outside the bounds of your company, you have to extract the answers from conversations with the denied party screening provider. As a result, watch out when:  

  • The provider cannot communicate how soon after updates are published by the regulatory agency are they available for you to screen against.  
  • The provider cannot show you the record for an entity known to be on a specific denied party list.
  • There are inconsistencies in how the denied party screening data is formatted and structured. 
  • The denied party screening data does not contain all of the information provided by the regulatory agency. 

THREE: Gaps in Screening Coverage  

Organizations usually have multiple points within their business processes where third parties (individuals and entities) requiring screening may surface. It can span from the beginning of the sales cycle all the way to the order processing / shipping stage.  It could also be part of the legal compliance process, within the human resources function, or even at the visitor vetting and management level. When analyzing your business, think of where vendors, customers, sales prospects, employees, contractors, and other third parties get introduced into your company network. Can your denied party screening solution cover all of these third party scenarios?  

In addition to the type of third parties, consider the timing of when they enter your company’s sphere. For example, do you have a way to screen entities that already exist in your system prior to your onboarding with the vendor? How will you capture new names? What if an existing business partner of yours gets added to a sanctions list in between screenings? 

A robust denied party screening provider should offer sanction screening solutions that have the capacity to cover for all contexts. It may be worth reassessing your denied party screening vendor if they cannot:    

  • Provide solutions that can screen any kind of business partner or process step that increases your exposure to sanctions compliance risks (vendors, customers, employees, business partners, sales orders, purchase orders, payments etc.).
  • Provide solutions that can screen third parties from all different time periods (pre-existing/historic partners, new partners, and if an existing partner is added to a sanctions list in the future).  

FOUR: Insufficient Flexibility and Long-Term Potential  

As your business grows, so do your sanctions screening requirements, with evolving demands and scope. Choose a restricted party screening provider that can support you through your journey and understands the specific needs your organization may have. Below are some questions you can ask to gauge the long-term potential of a sanctions screening solution vendor:  

  • How flexible is the provider in terms of transaction limits, pricing, and contract terms?   
  • Would the provider consider sourcing a denied party list you need which they do not have available today?  
  • Consider the number of systems your users log into on a daily basis. Can the sanction screening solution easily integrate into the systems you use every day?  
  • How invested is the provider in improving their products and services? Is there an ability for you to request new features and provide feedback?  
  • Are there services to help fine tune and optimize your denied party screening process to reduce the burden on your organization?  
  • Is there adequate training and support provided for users? What is their help desk availability and where are their customer service team located?  

FIVE: Lack of Configurability Options in the Denied Party Screening Solutions 

A robust restricted party screening solutions provider should have more than a few software options that customers can choose from to fit their particular needs in the immediate terms and grow into others over time. While similar to 4. above, this particular point focuses on features and functions. 

Configurability is key. For example, you might need online and batch screening now to get started. But as your organization grows, there is a greater need to leverage advanced technology such as integrated screening, automated daily rescreening, as well as resolution and escalation workflow to deal with potential matches with watch lists. 

Going more specialized, some of the better denied party screening vendors on the market even have pre-built integrations with a wide range of Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) platforms, such as Salesforce, Microsoft Dynamics, Oracle, SAP, NetSuite to name a few.  

Always ask the denied party screening vendor you are talking to what configuration options they have available. Red flags here include: 

  • The provider has a less than impressive configurability list. 
  • They cannot easily integrate with major ERP and CRM platforms. 
  • They find it more than challenging to integrate with legacy, or homegrown business systems. 

Select the Right Denied Party Screening Vendor at the First Try 

While comparing denied party screening providers can be an exhausting process, it can be a much larger headache to commit to one that isn’t right for you and then have to start the process over. However, by asking the correct questions and avoiding red flags, you can find your perfect match to protect your organization with ease and confidence.   

Hopefully, these tips prove useful to you in steering clear of the pitfalls in the sanctions screening software vendor selection process. The name of the game is to try to get it right the first time.  

Descartes provides a suite of premier denied party screening software solutions that help organizations around the world reach the highest export compliance standards while reducing the risk of negative impacts to the bottom line.  

But don’t take our word for it, see what users are saying about our denied party screening solutions. For more information including a demo and a Trial, reach out to me directly or Contact Us.  

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We Answer Your Questions About Denied Party Screening

  1. How Much Does A Denied Party Screening Solution Cost?
  2. Top Red Flags to Look Out for When Selecting a Denied Party Screening Software Vendor
  3. How to Identify a Best-In-Class Denied Party Screening Software
  4. How to Manage False Positives in Denied Party Screening
  5. How to Effectively Compare Denied Party Screening Software Vendors
  6. What do Organizations in my Industry Need to be Mindful of When it Comes to Denied Party Screening and Export Compliance?
  7. Unforced Errors in the World of Export and International Trade Compliance Violations That You Need to Know About
  8. 12 Steps to Optimize Your Denied Party Screening Program
  9. ROI of Compliance: How Denied Party Screening Drives Value Creation for the Organization
  10. Top Five Best Practices to Integrated Denied Party Screening