Glossary

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A

Correct and up-to-date postal and e-mail addresses are the basic prerequisite for successful customer dialogue. Returns and undeliverable mailings cause high costs. Regular checking and cleansing of the stock of postal and e-mail addresses helps to reduce such costs. These tasks are supported by data quality tools such as TOLERANT Post, TOLERANT Move and TOLERANT Match. The tools match postal addresses with address and move data from Deutsche Post and check the deliverability of e-mail addresses. With the help of the error-tolerant search, duplicates and duplicates are recognised and cleansed even if they have similar spellings.

see Address data cleansing

see Support vs. Consulting

AML stands for Anti-Money Laundering and refers to measures to prevent, detect and combat money laundering. These include, for example, customer identification, risk assessment, monitoring of business
relationships, PEP and sanctions checks, as well as the investigation and reporting of suspicious circumstances. AML processes are required by law for numerous companies and professional groups.

The AMLA is the European authority for combating money laundering and the financing of terrorism, based in Frankfurt am Main. Its role is to ensure a more consistent application of European AML/CFT regulations, to coordinate national supervisory authorities and Financial Intelligence Units (FIUs), and to directly supervise selected financial institutions posing a particularly high risk. Furthermore, the AMLA develops technical standards, guidelines and recommendations for the implementation of the European regulatory framework.

AML Case Management refers to the structured handling and documentation of anomalies and suspicious cases within the framework of anti-money laundering. Information, audit results, documents, comments, tasks, approvals and decisions can be consolidated within a single case and processed in a traceable manner. A system-supported case management system facilitates standardised processes and audit-proof documentation.

The AMLR is the new EU Anti-Money Laundering Regulation (Regulation (EU) 2024/1624). It establishes directly applicable and largely uniform rules for combating money laundering and terrorist financing in the European Union. These include, amongst other things, requirements relating to customer identification, beneficial owners, risk assessment, and simplified and enhanced due diligence obligations. The AMLR is, in principle, to apply from 10 July 2027.

The European Union prohibits business relations with terrorists and supporters of extremist groups. Who belongs to these groups can be found on anti-terror lists, sanction lists or embargo lists, which the EU updates regularly. With the tool TOLERANT Sanction, the customer base can be automatically checked against anti-terror, sanction and embargo lists. The relevant departments then have to evaluate the hits found.
An audit trail is a traceable and, as far as possible, complete record of checks, changes, processing steps and decisions within a system or business process. In the compliance context, it enables, for example, proof of when a check was carried out, what information it was based on, who made a decision and how it was justified. An audit trail thus supports internal controls, audits and regulatory reviews.

B

Bank data such as IBAN and BIC can be automatically checked and corrected with the TOLERANT Bank validation software as soon as they are entered.

TOLERANT products offer two basic types of use: the batch mode, which can be carried out offline, and the service mode, which is carried out online.

When many data records are processed in a single process step, it is called a batch (‘batch processing’). Originally, the term ‘batch’ comes from the automated processing of a stack of punch cards. Today, it refers to the unattended processing of a usually large amount of data according to a uniform processing pattern. In batch mode, large data sets can be quickly compared with each other.

The service mode is processed online via an API interface and is therefore also called API mode. The abbreviation API stands for ‘Application Programming Interface’.

In practice, the service or API mode is usually used when it comes to direct integration into an application. For example, when address data is to be checked directly while it is being entered into the CRM system. The API mode is also usually used for individual queries in the form of a web service, while the entire data stock is checked and cleansed at regular intervals in batch mode.

The Bank Identifier Code (BIC) is an internationally valid bank code and is assigned and defined by the Society for Worldwide Interbank Financial Telecommunication (SWIFT).

C

Customer Due Diligence refers to the due diligence measures that companies carry out to assess their customers and business relationships. These include, in particular, the identification and verification of the customer and, where applicable, their beneficial owners, the determination of the purpose and nature of the business relationship, and its ongoing monitoring. The scope and intensity of the measures depend on the respective risk.

see Index

CFT refers to the joint fight against money laundering and terrorist financing. Organisations subject to the relevant legal obligations must identify risks and put in place appropriate organisational and technical measures to mitigate them. These include, amongst other things, customer checks, risk assessments, ongoing monitoring and the reporting of suspicious activities.

In cloud computing, software programmes or data storage are provided on external servers and used virtually via the internet. In contrast, data is stored locally and on-site on on-premise servers.
Products from TOLERANT Software are completely cloud-capable and can be operated on the customer’s cloud platform. In addition, TOLERANT Software also offers some products as a cloud service or Software as a Service (SaaS). The SaaS service is particularly suitable for fault-tolerant data reconciliation with PEP lists (TL Cloud PEP), with sanction lists (TL Cloud Sanction), with company data (TL Cloud Business), with address data (TL Cloud Post) and with bank data (TL Cloud Bank).

Cologne phonetics is a computer algorithm that assigns a digit to each linguistic sound of a word. The coding of text into digits is used to classify words according to their sound. With the help of Cologne Phonetics, a computer recognises which words sound similar. The algorithm enables the computer to search through databases in an error-tolerant manner and to find a similar-sounding word when a word is entered. In contrast to the Soundex and Metaphone methods, which were designed for the English-speaking world, Cologne Phonetics was adapted for the German-speaking world. Cologne phonetics codes consonants with the digits 1 to 8. Vowels receive the digit 0. When assigning a digit to a linguistic sound, neighbouring letters are also taken into account. For example, the letter P is coded with the digit 3 if it comes before an H. In all other cases, it is assigned to the letter K. In all other cases, it is assigned to the code 1. Cologne phonetics is used together with Soundex and Metaphone in the duplicate checking tool TL Match. Thanks to the integrated algorithms, TL Match finds the record “Alexander Sczepansky”, for example, even if “Alex Schepanski” was searched for.
The collection, processing and use of personal data in Germany is regulated by §11 of the Federal Data Protection Act (BDSG). If data is collected, processed or used on behalf of third parties, the business partners must enter into a commissioned data processing agreement (AVV). According to §9 BDSG, such an agreement also specifies the technical and organisational measures for data processing. For the use of TOLERANT software products, business partners should also conclude a contract for commissioned data processing with their software supplier if “the testing or maintenance of automated procedures or of data processing systems is carried out by other bodies on behalf and access to personal data cannot be ruled out” (§ 11 para. 5 BDSG).
In order to comply with legal regulations (such as the EU Data Protection Regulation) or other external regulations, uniform standards are introduced and implemented in the company. The implementation of these mechanisms can be supported by data quality tools such as TOLERANT MPM, TOLERANT PEP or TOLERANT Sanction.

see Index

A customer relationship management system (CRM system for short) organises and manages a company’s relationship with its customers. Usually, customer data is stored in a CRM system together with the contact and sales history. Every interaction with the customer is documented in the CRM system. All company departments that have access to the CRM system can use the system to serve and interact with the customer.

D

see Address Data Cleansing

siehe unter ETL-Prozesse

Data stewards are responsible for data quality in a specific department within a company. Together with the cross-departmental data quality manager, data stewards coordinate the monitoring of data quality in an organisation.
The quality of data is reflected in its usefulness. Data is good when it fulfils the purpose for which it was generated. Important criteria for assessing data quality are, for example, correctness, completeness, consistency, relevance and timeliness.
A DQ connector is an interface between a CRM or ERP system and data quality tools. Data quality tools take over different tasks for quality assurance in the collection and processing of customer data. For example, customers can be fuzzy searched. Addresses can be found, checked and completed by auto-completion. Before saving, it can be checked again that no duplicates are created. The DQ-Connector ensures that the CRM or ERP system remains free of duplicates and that correct data is entered.

see DQ Issue Management

A data quality manager has a central role in a company. Together with the departmental data stewards, the data quality manager ensures the data quality in a company. In case of problems, he or she mediates between the IT administrator and the data stewards.
Advertising blacklists protect consumers from unwanted advertising mailings. These include, for example, the Robinson lists of the German Internet Association (I.D.I. e.V.) or the German Dialogue Marketing Association (DDV). With the data quality tool TOLERANT MPM, customer data can be compared with such dialogue ban lists.
The open source software Docker packages software in containers. These compact units contain everything needed to run the software, such as libraries, system tools, codes and runtimes. Similar to cargo containers on a cargo ship, software containers can be docked to a Docker host and scaled horizontally. Horizontally scaled containers can be operated modularly, i.e. side by side and independently of each other, when they are needed at the time. The use of Docker containers makes sense, among other things, when a large amount of computing power is needed at short notice. The additional computing power can be shifted to Docker containers. Furthermore, Docker containers simplify the installation and updating of software. TOLERANT software products can also be delivered and operated in Docker Containers.
DQ issue management is a process for correcting data quality problems (DQ issues). These include, for example, invalid postal addresses, spelling errors, duplicates, or incomplete data records. These quality errors are measured, assessed and corrected in a structured process. DQ Issue Management combines automated measuring tools, process control and manual inspection steps. Tools from TOLERANT Software serve as the basis for DQ Issue Management.
Duplicates are double data records for the same person or company that differ in minor characteristics (e.g. different spelling, different address data). By means of an error-tolerant search, duplicates can already be identified and cleansed during data entry. The TOLERANT Match tool helps to automatically identify and clean up duplicates when merging large databases.

see Duplicates

E

Enhanced Due Diligence refers to more rigorous due diligence measures applied to customers or business relationships presenting an increased risk of money laundering or terrorist financing. Depending on the risk profile, additional information may be obtained, for example, regarding the customer, beneficial owners, the origin of the funds used or the origin of the assets, and more intensive monitoring measures may be implemented. The scope and intensity of the measures depend on the assessed risk.

see Address Data Cleansing

see Anti Terror Lists

see ERP system

An enterprise resource planning system is a software-based merchandise management system that maps the processes in a company. Customer data is also required for planning, controlling and managing the processes. Data quality products such as TOLERANT Match or TOLERANT Name can be linked to common ERP systems via interfaces. In this way, errors in addressing customers on quotations, order confirmations and invoices can be completely avoided or reduced.
The error-tolerant search is also called “fuzzy search” in software jargon. With an error-tolerant search, similar spellings are taken into account. This is particularly useful for names that are difficult to spell, whose spelling differs greatly from the pronunciation, or for incomplete information. The hit list then shows all terms that could be meant. For example, if you search for “Szymanski”, you will also find “Schimanski” and “Sczymansky” in the results list thanks to the error-tolerant search.
The abbreviation ETL refers to the three data migration processes extraction (E), transformation (T) and loading (L). When data is transferred from one system to another, these three processes are usually run through. ETL processes are batch-oriented; their data timeliness is therefore limited.

An EU list of high-risk countries is a list drawn up by the EU of countries that are considered to be high-risk.

F

The Financial Action Task Force is an international body dedicated to combating money laundering, terrorist financing and the financing of the proliferation of weapons of mass destruction. The FATF develops international standards and recommendations that serve as a basis for national and European regulations on money laundering prevention. The FATF is also known for its assessments of countries and its classification of those with strategic deficiencies in the fight against money laundering.

see Support vs. Consulting

A Financial Intelligence Unit is a national central body responsible for receiving and analysing information on suspicious financial transactions and activities relating to money laundering and terrorist financing. In Germany, this is the Central Office for Financial Transaction Investigations within the General Customs Directorate. Among other things, it receives suspicious transaction reports from obliged entities, analyses them and forwards relevant findings to the competent authorities.

see Error-tolerant search

G

The European General Data Protection Regulation (EU GDPR) came into force on 25 May 2018. It standardises the handling of personal data and protects natural persons whose personal data is processed by third parties.

According to Article 15 of the GDPR, data subjects have, for example, the right to ask data controllers whether their personal data are being processed. Controllers are obliged to respond to such data protection requests in a timely manner.

According to Article 12(1) and Article 5(2) of the GDPR, controllers must prepare for such requests and take appropriate measures to respond to data subjects in a timely manner. In Germany, the GDPR is supplemented and specified by the Federal Data Protection Act (BDSG).

The TOLERANT MPM product from TOLERANT Software helps companies to respond to data protection requests in a seamless and legally compliant manner.

I

The IBAN is a standardised, international notation for account numbers.
It was introduced to standardise international payment transactions.
In a cross-system search or customer index, data from different sources and systems are brought together centrally. The index speeds up cross-system searches and queries because it eliminates the need for separate searches in the individual systems. A central search in a cross-system index is – according to our estimates – on average 60 times faster than a conventional search in several systems. The cross-system search index is included in the product TOLERANT Match.

K

Know Your Business refers to the identification and verification of companies and other legal entities as customers or business partners. In addition to a company’s master data, details such as its legal form, authorised representatives, ownership and control structures, and beneficial owners are determined. KYB processes serve, in particular, to assess risks in business relationships with companies in a transparent and traceable manner.

“Know Your Customer” refers to the identification and verification of customers as part of anti-money laundering measures. In doing so, businesses must, amongst other things, establish with whom they are entering into a business relationship, verify the customer’s identity and assess the risk associated with the business relationship. KYC is an essential component of customer due diligence and forms part of a business relationship not only during onboarding but also through regular or event-driven reviews.

L

Milieu and lifestyle play an important role in a purchase decision. It is therefore worthwhile for sales to take a closer look and classify target groups based on their lifestyle data in order to address exactly the right potential customers. The TOLERANT Post data quality tool uses CAMEO lifestyle data from Deutsche Post Direkt GmbH. CAMEO data can be used to segment residential environments microgeographically and classify them according to social class, financial strength and life stage. The lifestyle data helps to specifically typologise target groups, to recognise potentials and in this way to increase market shares in the long term. CAMEO data are available for many European and international countries. For Germany, they include over 40 characteristics for regional and socio-demographic differentiation. These characteristics are in turn grouped into 9 main groups so that lifestyles, consumer behaviour and interests of the individual groups can be clearly distinguished from each other.

M

see Lifestyle data

N

see Parsing

O

Obligated entities are defined as companies, institutions and certain professional groups that must comply with legal requirements to combat money laundering and terrorist financing. These include, in particular, credit and financial institutions, certain insurance companies and numerous other companies and professional groups. Obligated entities must, amongst other things, assess risks, fulfil due diligence obligations, establish internal safeguards and, where the relevant conditions are met, submit suspicious activity reports.

Ongoing monitoring refers to the continuous monitoring of an existing business relationship. This involves checking whether customer data, risk assessments and beneficial owners remain up to date, and whether transactions or activities are consistent with the customer’s known profile. Changes or anomalies may trigger a reassessment and, where necessary, additional due diligence measures.

see Cloud Computing

P

During parsing, free text fields – such as names – are split into components such as salutation, title, first name and last name. Data quality tools like TOLERANT Name do the parsing automatically. For example, TL Name automatically splits the input “Dr. Alexandra Schellenberger” into salutation (“Frau”), title (“Dr.”), first name (“Alexandra”) and last name (“Schellenberger”). The automatic analysis, standardisation and structuring of the name components help to avoid addressing errors and to address the customer correctly.
In partitioning, the data records of a large data set with similar characteristics are divided into sub-areas (partitions) in which the search is then carried out. Typical characteristics that are suitable for partitioning are, for example, the postcode, telephone area code, e-mail domain or date of birth. For partitioning, the characteristics should be available from all customers without gaps. Partitioning has the advantage that it speeds up the search for data because only relevant sub-areas then have to be searched and not the entire stock. The relevant sub-areas result from the values in the search field. This diagram shows the partitioning process graphically.
Politically exposed persons (PEPs) are natural persons, such as politicians, who hold a particularly influential post. In order to avoid corruption and bribery, companies have a special duty of care when dealing with PEPs according to the EU Anti-Money Laundering Directive. For example, they are obliged to identify PEPs in their customer base. The TOLERANT PEP tool automatically compares the customer base with internationally valid PEP lists.
A postal address should be machine-readable so that items can be delivered without delay. International standards such as ISO 19160-4 and the German standard DIN 5008 standardise the correct structure, spelling and components of a postal address. Accordingly, a postal address in Germany consists of the company and/or contact person, street and house number (or P.O. Box), postcode and destination. For international addresses, a country code before the postcode is no longer common. According to the updated DIN 5008 standard, the country name in German, English or French is placed in capital letters below the postcode and destination. Blank lines between the individual address components are also no longer common.
Confidential customer data is often exchanged between business partners in pseudonymised form – for example, to preserve business secrecy or for security reasons. During pseudonymisation, personal characteristics such as name, address or telephone number are replaced by pseudonyms.The data quality tool TOLERANT Match can also search completely pseudonymised data sets in an error-tolerant manner and detect duplicates. All other customer data remains anonymous during the search and business secrecy is maintained.

R

see Address Data Cleansing

The risk-based approach is a fundamental principle of anti-money laundering. Companies should tailor their verification and monitoring measures to the nature and level of the risk identified in each case. Customers or business relationships posing a higher risk require correspondingly more intensive checks than those with a low risk. This ensures that resources are targeted specifically where the risk of money laundering or terrorist financing is particularly high.

S

see Anti Terror Lists

Simplified Due Diligence refers to simplified due diligence measures in cases where there is a demonstrably lower risk of money laundering or terrorist financing. Which simplifications are permissible depends on the specific risk situation and regulatory requirements. Even when applying simplified measures, companies must assess the existing risk in a transparent manner and must not completely dispense with their due diligence obligations.

see Error-tolerant search

In the Single Euro Payments Area (SEPA), credit transfers, direct debits and card payments are processed uniformly. All 28 EU member states and 8 other countries participate in SEPA.

See under Batch vs. Service mode

Source of Funds refers to the origin of the financial resources used for a specific transaction or business relationship. This involves checking, for example, whether the money originates from a salary, company profits, a sale, an inheritance or other verifiable sources. Verifying the source of funds may form part of enhanced due diligence measures, particularly where there is an increased risk of money laundering.

Source of Wealth refers to the origin of all or a significant portion of a person’s assets. Unlike Source of Funds, this does not concern only the money involved in a specific transaction, but rather how the assets as a whole were acquired, for example through business activities, income, investments or inheritances. Verifying the source of wealth may be required, particularly in cases of heightened risk or specific business relationships.

A suspicious transaction report is submitted when facts or anomalies indicate a possible link to money laundering, terrorist financing or certain other reportable matters. In Germany, such reports are generally submitted by obliged entities to the Financial Intelligence Unit (FIU). Internationally, the abbreviations STR (Suspicious Transaction Report) or SAR (Suspicious Activity Report) are frequently used for this purpose.

If you have any questions about TOLERANT products, our service department will be happy to help you. We have divided our after-sales support into three areas: the support department, the consulting department and the development department.

The first point of contact for all customer enquiries is our first-level support staff. They answer questions about the operation of our data quality products and provide technical assistance and support in case of problems. Many application problems (such as questions about the product version, product compatibility or licence keys and reference data) can be fully handled by first-level support. First-level support also checks whether the error has been fully described. If this is not the case, the support staff will supplement the customer’s error description if necessary or help the customer with the wording. Missing information, such as files, logs and requests for the query, are requested from the customer if necessary.

More complex customer enquiries that cannot be fully answered by first-level support are forwarded to the consulting department of TOLERANT Software. Based on the documentation prepared by the first-level support, the consulting employee gets a quick overview of the customer enquiry. In this way, they can quickly deal with the customer enquiry and respond to it without lengthy training.

Even more specific application problems – including product compatibility with the company’s own CRM or ERP programmes – are solved by the development department of TOLERANT Software. In close consultation with the customer or with the user in his specialist department, our development department works out solutions that are precisely tailored to the specific application. Third-level support is used in particular for major customers who process several million data records per year.

All three areas of our service departments can be reached during our service hours Monday to Friday from 9 a.m. to 5 p.m. at +49 711 490 448 70 and at support@tolerant-software.de. 

T

In target marketing, specific target groups are addressed. The target groups can, for example, be narrowed down regionally or socio-demographically by means of micro-geographic segmentation. 

see Target Marketing

U

UBO stands for Ultimate Beneficial Owner and refers to the natural person who ultimately owns or controls a company or other legal entity, or in whose interest a transaction is carried out. Identifying beneficial owners is an essential part of anti-money laundering measures. In doing so, multitiered and indirect ownership and control structures must also be taken into account where necessary.