New research from LSEG reveals that financial institutions and designated non-financial businesses and professions (DNFBPs) are increasingly struggling to manage compliance risks due to poor-quality and outdated screening data. Based on feedback from 400 senior compliance leaders, the report underlines the importance of timely and accurate data in today’s complex regulatory environment.
One major concern is the lack of speed in data updates—over 50% of respondents said they receive sanctions information after 24 hours or more, which puts them at risk of breaching regulatory requirements. Additionally, 32% reported false positive rates of up to 30% in a typical month, adding to operational strain and compliance costs.
The report also found that 44% of organisations believe better coverage—more accurate and complete data—is the most valuable improvement they could make to their sanctions and AML systems.
In response, many are exploring technology-led solutions. Around 31% see AI and machine learning as key to enhancing screening effectiveness, and 65% expect these technologies to play a major role by 2025. More than half of respondents also plan to invest in generative AI and natural language models in the next three years.
Still, the report stresses that the use of AI must be underpinned by trusted data. Without high-quality, timely information, automation risks becoming a liability rather than an asset.
The clear message: in an environment where every second counts, good data is essential for effective compliance.
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