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Navigating PEP Compliance: Managing High-Risk Customer Relationships.
- 1. Navigating PEP Compliance SecureSolutions for a Regulated World: Bridging Compliance and Business Excellence.
- 2. Understanding Politically ExposedPersons (PEPs) A PEP is a natural person entrusted with prominent public functions, including their immediate family or close associates, but excluding middle-ranking or junior officials.
- 3. Why PEPs areHigh-Risk Customers PEPs are considered High-Risk Customers(HRCs) due to their susceptibility to corruption. Declaring PEPs in KYC is essential for assessing and managing risks, allowing firms to accept or exit relationships responsibly.
- 4. Key Factors forPEP Categorization Official Responsibilities Level of Authority Access to Assets Consider the individual's function and the nature of their title (honorary or salaried). Evaluatetheir authority over governmental activities and other officials. Determine if theyhave access to significant government assets, funds, or the ability to direct tenders.
- 5. Essential Controls forPEP Relationships New Client Approval Identify PEPs early and escalate for senior approval. Existing Client Identification Apply enhanced procedures when an existing client becomes a PEP. EnhancedDue Diligence Conduct additional research, including source of funds and negative news checks.
- 6. Customer Due Diligence(CDD) Key Takeaways Identify and verify customer identities and beneficial owners; understand the relationship's purpose. Perform Enhanced Due Diligence (EDD)forincreased money-laundering risks,such as PEPs. Do not enter or continue business relationships if CDD measures cannot be applied or beneficial ownership cannot be confirmed.
- 7. Contact Us Forsecuresolutionsinaregulated world,connect with MEMA Consultants. Email: contact@memaconsultants.com Phone: 03301330811 Address: Suite 1810, Unit 3a, 34-35 Hatton Gardens, Holborn, EC1N 8DX Contact Us MEMA Insights Learn more : https://memaconsultants