Politically exposed foreign person or PEP (UK)
The UK definition of a PEP, as found in the UK Money Laundering Regulations 2007 are as follows:
(Note: the Joint Money Laundering Steering Group use this when issuing their Guidance Notes.)
Section 14(5) paragraph (4), defines a PEP as “a politically exposed person” meaning a person who is—
(a) an individual who is or has, at any time in the preceding year, been entrusted with a prominent public function by—
- (i) a state other than the United Kingdom;
- (ii) a Community institution; or
- (iii) an international body,
including a person who falls in any of the categories listed in paragraph 4(1)(a) of Schedule 2;
(b) an immediate family member of a person referred to in sub-paragraph (a), including a person who falls in any of the categories listed in paragraph 4(1)(c) of Schedule 2; or
(c) a known close associate of a person referred to in sub-paragraph (a), including a person who falls in either of the categories listed in paragraph 4(1)(d) of Schedule 2.
(6) For the purpose of deciding whether a person is a known close associate of a person referred to in paragraph (5)(a), a relevant person need only have regard to information which is in his possession or is publicly known.
Schedule 2 provides the following clarification: Politically exposed persons
4.—(1) For the purposes of regulation 14(5)—
(a) individuals who are or have been entrusted with prominent public functions include the following—
- (i) heads of state, heads of government, ministers and deputy or assistant ministers;
- (ii) members of parliaments;
- (iii) members of supreme courts, of constitutional courts or of other high-level judicial bodies whose decisions are not generally subject to further appeal, other than in exceptional circumstances;
- (iv) members of courts of auditors or of the boards of central banks;
- (v) ambassadors, chargés d’affaires and high-ranking officers in the armed forces; and
- (vi) members of the administrative, management or supervisory bodies of state-owned enterprises;
(b) the categories set out in paragraphs (i) to (vi) of sub-paragraph (a) do not include middle-ranking or more junior officials;
(c) immediate family members include the following—
- (i) a spouse;
- (ii) a partner;
- (iii) children and their spouses or partners; and
- (iv) parents;
(d) persons known to be close associates include the following—
(i) any individual who is known to have joint beneficial ownership of a legal entity or legal arrangement, or any other close business relations, with a person referred to in regulation 14(5)(a); and
(ii) any individual who has sole beneficial ownership of a legal entity or legal arrangement which is known to have been set up for the benefit of a person referred to in regulation 14(5)(a).
(2) In paragraph (1)(c), “partner” means a person who is considered by his national law as equivalent to a spouse.
Full text of the The Money Laundering Regulations 2007 is available at: http://www.legislation.gov.uk/uksi/2007/2157/contents/made