Podcast
Questions and Answers
A PEP is defined by the FATF as a person who holds, or has held a non-prominent public function.
A PEP is defined by the FATF as a person who holds, or has held a non-prominent public function.
False
PEPs are at a lower risk of being involved in money laundering and related crimes.
PEPs are at a lower risk of being involved in money laundering and related crimes.
False
FATF Recommendations 12 and 22 require countries to deny business relationships with PEPs.
FATF Recommendations 12 and 22 require countries to deny business relationships with PEPs.
False
The FATF's PEP requirements are intended to stigmatize business relationships with PEPs.
The FATF's PEP requirements are intended to stigmatize business relationships with PEPs.
Signup and view all the answers
A PEP can be a person who holds, or has held a private sector function.
A PEP can be a person who holds, or has held a private sector function.
Signup and view all the answers
The definition of a PEP varies across different countries.
The definition of a PEP varies across different countries.
Signup and view all the answers
FATF Recommendations 12 and 22 are related to customer due diligence.
FATF Recommendations 12 and 22 are related to customer due diligence.
Signup and view all the answers
A Member of a supreme court is not considered a Politically Exposed Person.
A Member of a supreme court is not considered a Politically Exposed Person.
Signup and view all the answers
Isabel dos Santos was accused of using her political connections to gain control of important industries outside Angola.
Isabel dos Santos was accused of using her political connections to gain control of important industries outside Angola.
Signup and view all the answers
The Luanda Leaks investigation did not reveal any corruption or embezzlement of public funds.
The Luanda Leaks investigation did not reveal any corruption or embezzlement of public funds.
Signup and view all the answers
A close associate of a PEP can be a family member.
A close associate of a PEP can be a family member.
Signup and view all the answers
The treatment of a PEP should be based on a prescribed time limit.
The treatment of a PEP should be based on a prescribed time limit.
Signup and view all the answers
A Member of Parliament is not considered a Politically Exposed Person.
A Member of Parliament is not considered a Politically Exposed Person.
Signup and view all the answers
The inclusion of family members in the PEP definition is intended to alert financial institutions of potential benefits.
The inclusion of family members in the PEP definition is intended to alert financial institutions of potential benefits.
Signup and view all the answers
The Luanda Leaks investigation was published in December 2019.
The Luanda Leaks investigation was published in December 2019.
Signup and view all the answers
Study Notes
Political Exposed Person (PEP) Definition
- A PEP is defined by the Financial Action Task Force (FATF) as a person who holds, or has held, a prominent public function.
- PEPs are considered high-risk due to their position and influence, making them vulnerable to abuses such as money laundering, corruption, and bribery.
Examples of Government Positions that Fit the PEP Definition
- Head of state
- Head of government
- Minister
- Deputy minister or secretary of state
- Member of Parliament or similar legislative body
- Member of the executive board of a political party
- Member of a supreme court
- Member of a court of account or board of directors of a central bank
- Ambassador, chargé d'affaires, or senior officer of the armed forces
Considerations for PEP Investigations
- Direct relationships with PEPs, including family members and close associates, should be considered.
- Family members include relatives, while close associates include non-family relationships, such as boyfriends, girlfriends, lovers, or mistresses.
Duration of PEP Status
- There is no clear definition of when a person ceases to be a PEP.
- The treatment of PEPs should be based on a risk-based approach rather than a prescribed time limit.
Case Study: Luanda Leaks Investigation
- Isabel dos Santos, daughter of the former president of Angola, was accused of using her political connections to gain control of important Angolan industries.
- The investigation revealed corruption, embezzlement of public funds, and the transfer of public funds for personal gain.
- International companies and financial institutions that did business with dos Santos and her associates were implicated in potentially unethical transactions.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Learn about the concept of Political Exposed Person (PEP) in the Know Your Customer field, its significance as an increased risk, and the definition provided by the Financial Action Task Force (FATF). Explore the implications and considerations surrounding PEPs.
