Nasdaq Verafin is embarking on a strategic collaboration with sanctions screening provider Fincom to bring more robust sanctions screening technology to clients. Sanctions screening is an indispensable tool for banks in an increasingly complex financial crime and compliance landscape.
The new partnership will combine Nasdaq Verafin's extensive anti-financial crime platform with Fincom's specialized sanctions screening technology. It’s especially important at a time when financial institutions face increasing regulatory demands and operational challenges.
Concurrent with the technology partnership, Nasdaq Ventures, the global venture investing program of Nasdaq, has led Fincom’s Series B financing. Additional investors participating in the round included Macquarie Group, G1 Ventures, and existing Fincom investors AnD Ventures and FF Venture Capital.
An Innovative Partnership
The seed of a partnership was planted after Nasdaq Ventures identified Fincom's potential and brought it to the attention of the Nasdaq Verafin team.
"The Nasdaq Ventures team put Fincom on our radar," said Rob Norris, Senior Vice President, Head of Product at Nasdaq Verafin. "Fincom’s innovative approach to sanctions screening and their traction in the market led us to take a deeper look."
Nasdaq Verafin already provides sanctions screening services to its clients. But after meeting with Fincom, Nasdaq Verafin recognized Fincom’s capabilities were complimentary to Nasdaq Verafin’s existing solutions.
"We saw them as a potential partner to help bolster our existing anti-financial crime offering," said Norris. "Particularly in how they provide real-time, low-latency payment sanctions screening."
The timing for such a partnership is opportune. Financial institutions globally face resource constraints, evolving regulatory requirements, and limitations in legacy sanctions and watchlist screening solutions.
In 2024, Nasdaq Verafin surveyed more than 200 financial crime professionals for its Global Financial Crime Report. According to survey participants, ensuring compliance with regulatory changes and expectations was the top concern over the next five to ten years.
"We were initially talking to a few VCs when we met a representative from Nasdaq Ventures," recalled Gideon Drori, Founder and CEO at Fincom. "What caught our attention was Nasdaq Verafin’s fluency and expertise in the field of sanctions screening. It felt like a match made in heaven given our complementary technologies."
“This recognition of our mutual strengths allowed us to elevate the partnership to a far more strategic arrangement than we originally expected," Drori explained.
Reinventing Name Matching with Phonetic Fingerprints
Founded in 2017, Fincom has developed proprietary "phonetic fingerprint" technology that excels at matching client and counterparty names against global sanctions lists. This capability is crucial in a world where name variations can significantly complicate compliance efforts.
"The name Muhammad, which is the most common name in the world, has 56 known spelling variations," Drori said. "Everyone’s name comes with small variations that appear commonly across languages and dialects, which makes matching names across datasets very complicated."
Fincom's approach uses computational linguistics, distance-based algorithms and advanced phonetics that function regardless of structure, language or data source. The system converts names into mathematical sequences based on phonemes rather than spelling, enabling accurate matching across databases in 44 different languages.
The technology has demonstrated that it can enable significant operational improvements for financial institutions.
"We've helped banks reduce sanctions compliance costs while significantly reducing the number of false positive alerts," Drori said.
This efficiency is increasingly vital as financial transactions accelerate, and customers demand services that keep pace with today's rapid-paced marketplace. Banks now operate in a global environment where transactions cross borders instantaneously and require screening solutions that can match this speed without sacrificing accuracy.
Scaling Up: What’s Next for Fincom and Nasdaq Verafin
For Fincom, the partnership with Nasdaq Verafin represents a significant opportunity to scale its business, particularly with larger financial institutions.
Drori discussed how Fincom already has multiple deals with large financial institutions and said this grouping was the "last ceiling" for the firm to break through. The partnership with Nasdaq should accelerate this expansion.
Nasdaq Verafin now plans to introduce Fincom's solutions to its client base. This collaboration will help Fincom expand its services in North America while providing Nasdaq Verafin customers with enhanced sanctions screening capabilities.
Norris was excited about how Fincom's name recognition technology could be applied to other use cases that would help clients combat financial crime and improve compliance management.
"This is part of Nasdaq Verafin’s journey to become a multi-product company that offers specific solutions for different use cases," explained Norris.
The new partnership will combine Nasdaq Verafin's extensive anti-financial crime platform with Fincom's specialized sanctions screening technology. It’s especially important at a time when financial institutions face increasing regulatory demands and operational challenges.
Concurrent with the technology partnership, Nasdaq Ventures, the global venture investing program of Nasdaq, has led Fincom’s Series B financing. Additional investors participating in the round included Macquarie Group, G1 Ventures, and existing Fincom investors AnD Ventures and FF Venture Capital.
An Innovative Partnership
The seed of a partnership was planted after Nasdaq Ventures identified Fincom's potential and brought it to the attention of the Nasdaq Verafin team.
"The Nasdaq Ventures team put Fincom on our radar," said Rob Norris, Senior Vice President, Head of Product at Nasdaq Verafin. "Fincom’s innovative approach to sanctions screening and their traction in the market led us to take a deeper look."
Nasdaq Verafin already provides sanctions screening services to its clients. But after meeting with Fincom, Nasdaq Verafin recognized Fincom’s capabilities were complimentary to Nasdaq Verafin’s existing solutions.
"We saw them as a potential partner to help bolster our existing anti-financial crime offering," said Norris. "Particularly in how they provide real-time, low-latency payment sanctions screening."
The timing for such a partnership is opportune. Financial institutions globally face resource constraints, evolving regulatory requirements, and limitations in legacy sanctions and watchlist screening solutions.
In 2024, Nasdaq Verafin surveyed more than 200 financial crime professionals for its Global Financial Crime Report. According to survey participants, ensuring compliance with regulatory changes and expectations was the top concern over the next five to ten years.
"We were initially talking to a few VCs when we met a representative from Nasdaq Ventures," recalled Gideon Drori, Founder and CEO at Fincom. "What caught our attention was Nasdaq Verafin’s fluency and expertise in the field of sanctions screening. It felt like a match made in heaven given our complementary technologies."
“This recognition of our mutual strengths allowed us to elevate the partnership to a far more strategic arrangement than we originally expected," Drori explained.
Reinventing Name Matching with Phonetic Fingerprints
Founded in 2017, Fincom has developed proprietary "phonetic fingerprint" technology that excels at matching client and counterparty names against global sanctions lists. This capability is crucial in a world where name variations can significantly complicate compliance efforts.
"The name Muhammad, which is the most common name in the world, has 56 known spelling variations," Drori said. "Everyone’s name comes with small variations that appear commonly across languages and dialects, which makes matching names across datasets very complicated."
Fincom's approach uses computational linguistics, distance-based algorithms and advanced phonetics that function regardless of structure, language or data source. The system converts names into mathematical sequences based on phonemes rather than spelling, enabling accurate matching across databases in 44 different languages.
The technology has demonstrated that it can enable significant operational improvements for financial institutions.
"We've helped banks reduce sanctions compliance costs while significantly reducing the number of false positive alerts," Drori said.
This efficiency is increasingly vital as financial transactions accelerate, and customers demand services that keep pace with today's rapid-paced marketplace. Banks now operate in a global environment where transactions cross borders instantaneously and require screening solutions that can match this speed without sacrificing accuracy.
Scaling Up: What’s Next for Fincom and Nasdaq Verafin
For Fincom, the partnership with Nasdaq Verafin represents a significant opportunity to scale its business, particularly with larger financial institutions.
Drori discussed how Fincom already has multiple deals with large financial institutions and said this grouping was the "last ceiling" for the firm to break through. The partnership with Nasdaq should accelerate this expansion.
Nasdaq Verafin now plans to introduce Fincom's solutions to its client base. This collaboration will help Fincom expand its services in North America while providing Nasdaq Verafin customers with enhanced sanctions screening capabilities.
Norris was excited about how Fincom's name recognition technology could be applied to other use cases that would help clients combat financial crime and improve compliance management.
"This is part of Nasdaq Verafin’s journey to become a multi-product company that offers specific solutions for different use cases," explained Norris.