IM Yearbook 2023

IM YEARBOOK
Karen Kelly
Director of Strategy & Development
Exiger
Looking forward:
Using real-time monitoring to make risk-based decisions
Exiger’s Karen Kelly says Russia’s invasion of Ukraine
has shown that continuous monitoring of previously
screened applicants is becoming ever more important.
In the weeks and months since the
Russian invasion of Ukraine in
February 2022, the importance of due
diligence has once more been highlighted.
Residency and citizenship by investment
(RCBI) pathways have of course been
impacted, with increased scrutiny on
their due diligence standards and overall
compliance programmes for the assessment
of individuals seeking a foothold in those
jurisdictions. The impact has not been
limited to the investment migration
industry, however. Any organisation doing
business with those connected to high-risk
jurisdictions such as Russia, including
large and small financial institutions and
corporations, has had to re-evaluate those
relationships and reassess the effectiveness
of their compliance programmes.
Monitoring works
In the immediate aftermath of Russia’s
invasion and the first of many waves of
sanctions targeting Russia and Belarus,
Exiger worked closely with partners
across all industries. This included those
in the investment migration industry,
looking back at their existing and previous
relationships; and in the context of RCBI
programmes, at previously approved
applicants. This covered targeted sanctions
and adverse media searches of previously
screened individuals and companies,
and often their close associates, for
any new and elevated risk arising from
direct or indirect sanctions exposure.
For our partners in the investment
migration industry, this exercise served
to validate and reinforce the necessity
and effectiveness of technology-enabled
monitoring of previously approved
applicants. Over the last five years, we have
seen ongoing, real-time monitoring, after
the initial due diligence report has been
delivered, go from a ‘nice-to-have’ to a
necessary component for programmes with
which we work. We strongly recommend it
as a best practice for all programmes and
due diligence providers working with them.
It was rewarding to confirm that,
while conducting re-screening exercises
for our clients, we did not uncover any
adverse information or risks not already
unearthed through our regular monitoring
of applicants. Notably, through the use of
an effective monitoring programme, our
clients learned of new adverse information
or risks in near real time, rather than at
the time of the re-screening exercise. Done
right, monitoring can and does alert a
programme to serious findings that come
up after an applicant is approved, putting
the programme in a position to proactively
address these issues rather than scrambling
to react after it has become a problem.
A necessary shift
Investment migration pathways are
playing catch-up when they rush to
re-check and re-screen previously
approved applicants when a new risk
or threat comes to the surface, like the
Russian sanctions risk. What the industry
demands, and what the new standard for
best practices requires, is a shift from a
“look back” mindset to “look forward”.
Today’s monitoring technology
offers RCBI pathways the opportunity
to avail themselves of the right real-time
information, putting them in a position
to identify individual applicants with
new and serious red flags. Moreover,
a monitoring programme centralises
volumes of information across complete
applicant populations into a single data
set, allowing programmes to identify
patterns of risk and changing trends in
risk exposure over time. Armed with
good data sooner, programmes can make
good decisions, and can look forward.
In the case of Russia in 2022, a
centralised view and analysis of Russian
applicants could identify almost
immediately what percentage of a pathway’s
48 - Investment Migration Yearbook 2O23