How does scoring work? AML+

With Pirani Scoring your organization will be able to have in a few steps the assessment of the risk level of your customers and counterparties in terms of LAFT and based on this level (high, medium or low), manage them in a better way.

Scoring is a tool for assessing and defining the risk level of a customer or counterparty with respect to involvement in money laundering or terrorist financing activities.  

→ Remember that to enjoy this functionality it is necessary to have the AML management system from the annual starter plan and purchase the AML+ extension. 

How do I define the scoring of my customers and counterparties?

To define the scoring you must go to the top bar and click on the gear figure, then go to the left side of the section and click on "AML". Finally you will find some cards, click on the "Scoring" card.


In the scoring section you will find two parameterization options, one to define the risk levels of the customers and counterparties, the other with the assessment parameters. 

First you should define the risk levels you are going to have in the scoring, which will be the main risk ratings of your customers and counterparties. The tool gives you 3 levels by default, but you can create up to 10 levels always keeping in mind that the scale of the percentages must go from 0 to 100.

How to create a new risk level?

To create a new level you must click on the "Create risk level" button and a new level will appear which you can configure according to your needs. 
It is important to note that if you create a new level the weight must always be distributed from 0 to 100 between the first and the last level, because of this the tool suggests a weight for the level being created.



You can also edit and delete a risk level by clicking on the pencil and trash can icons on the right side of the level. However, to make these changes effectively it is necessary to have consistency in the weights assigned to each level so that there is a proper distribution, so if you delete a level you must replace the weight in the existing levels.  


After assigning the risk levels, we move on to the scoring parameter setting.

How to create scoring parameters?

To create scoring parameters you should click on the "Scoring parameters" option and then click on the "Create scoring parameter" button. In this section you will be able to create different parameters for customers and counterparties due to different structures of these risk factors.First you should fill in the general information, such as the name, choose the type of entity and based on this choose the type of person, then write a description about the created parameter and finally click on the "Create and associate factors" button.

How to create the factors?

Now you must click on create factor, in order to create the assessment factors that will allow you to give certain relevance and weight to certain characteristics. When creating the factors you must give them a name and a weight between 0 and 100.
Important: the sum of all the factors created must be equal to 100.

How to create the fields?

Now click on the "Select fields" button. A window will open with all the list and numeric fields of the risk factor to be assessed and the product fields. To effectively add the fields of interest you must click on the "+" icon that appears on the right side of the field.



After adding the fields of interest, you must assign a weight to each of the fields taking into account that the sum of these weights must be equal to 100. In the process of assigning weights it is important to keep in mind that the field that you give more weight is the one that will have more relevance in the assessment of the risk factor. 

How to configure the fields?

To configure the fields you must click on the tachometer on the right side of the added field. There you will find the list of options that the field has and next to the name of the criterion a box to assign the "Risk level".
 Here you must assign a risk level to each of the options without exception, this risk level must be according to the risk levels created at the beginning. For example, in this case we have three risk levels, so you can set a risk level between 0-3. After assigning the risk level, the field will be colored according to the risk that corresponds to the assigned rating. 

Important: You must assign a rating to all fields without exception and if you do not want to assign any weight to that field, you must write a weight of "0".



After rating all the fields you can mark as critical the field you want to give the highest level of risk by clicking on the exclamation icon on the right side of the field. By doing this the field will be marked in red and the customer that has this field in their information will be marked as a high risk level factor. 


The field qualification is also given for numeric type, in this option you must create the necessary ranges for the field and assign a weight to each one.



Also, you can mass rate the fields, for this you must click on the "Mass Rating" button, choose all the fields to which you are going to assign the same rating, then write the risk level in the corresponding box and finally click on the "✔️" icon to assign the written rating to all the selected fields with a single click. 
Remember: The scoring must be done for all the risk factors and for all the fields of each of the factors for the scoring to be effective. 

How to know the score of the customer and the counterparty?

When you perform a bulk load of risk factors, the system will evaluate the fields created and assign points for all the fields evaluated, after adding up the points, it averages all the values of each of the risk factors and multiplies it by the weight of the risk factor. Finally a weighted average of all the risk factors is made, that will give a number from 0-100 and a colorimetry according to the risk levels. The products are also assessed, which will be assigned to the weight of the product owner and a score is added for each product.

You will find in the "Risk Factors" section a new column called "Score" with the ratings for each of the customers and counterparties according to the created scoring.