Ebook: Greenberg, Larissa Gray, Stolen Asset Recovery. Politically Exposed Persons. The World Bank, 2009

A Policy Paper on Strengthening Preventive Measures.This Policy Paper on Politically Exposed Persons (PEPs) is the result of special collaborative
efforts from colleagues around the world, whose time and expertise in the antimoney
laundering fi eld were generously shared. We especially thank the regulatory and
bank offi cials as well as Financial Intelligence Units and law enforcement authorities
that we met with in Argentina, France, Jersey, Hong Kong, Liechtenstein, Switzerland,
the United Kingdom and the United States during our field visits.ContentsAcknowledgments
Abbreviations
Executive Summary and Principle Recommendations
Part 1 Introduction and General Observations Introduction
Low compliance with International Standards
Objective
Methodology
How to Use This Paper
General Observations and Challenges
Low Level of Compliance with International Standards
Link between PEPs and Anti-Money Laundering Policies and Procedure
Banks Generally Indicate Doing More Than FATF, Legislation or Regulation Requires
Why Focus on PEPs?
Part 2 Implementation of International Standards on PEPs by Banks and Regulatory Authorities
Applying a Risk-Based Approach
Who Is a PEP?
Domestic versus Foreign PEPs
Only the Offi ce Holder versus Family Members and Close Associates
Other categories
How Long Is a PEP Considered a PEP?
Identifi cation of PEPs: Who to Check and When to Check
Who to Check
When to Check
Identifi cation of PEPs: How to Check
Would a National or International List of PEPs Be Easier?
Identifi cation of the Benefi cial Owner: Will the True Owner
Please Stand Up?
Identifi cation Tools
Identifi cation of PEPs: Commercial and In-House Databases
Identifying and Verifying Source of Wealth and Source of Funds
PEP Approval by Senior Management
Enhanced Ongoing Monitoring
Transaction Monitoring
Awareness of PEP Customers: Maintaining Access to a List of
PEP Customers
Keeping Customer Profi le Updated
Periodic Review Process
Part 3 Role of Regulatory Authorities and the Financial Intelligence Unit
Regulatory Authorities
Regulation of Banks’ PEPs Controls
Need for Additional Guidance from Regulator
Sanctions
Suspicious Transaction Reporting and Financial Intelligence Units
FIU Guidance to Reporting Institutions
Gathering Information
Part 4 National Cooperation, Training and Resources
National Cooperation: Agencies and the Industry
Training and Resources
Appendixes
A: Summary of Recommendations—Quick Reference Sheet
B: Summary of Good Practices—Quick Reference Sheet
C: Comparison of the PEPs Defi nitions and Enhanced Due Diligence Requirements
D: United Nations Convention against Corruption (UNCAC) and Interpretative Notes
E: Financial Action Task Force on Money Laundering (FATF)— Recommendations, Interpretative Notes, and Methodology
F: Directives of the European Parliament and of the Council
G: Field Mission Survey—Questions for Banks, Regulators, and Financial Intelligence Units