PEPhenkilöt
PEP-henkilöt, or Politically Exposed Persons (PEPs), is a term used in anti-money laundering and counter-financing of terrorism (CFT) to designate individuals who hold or have held prominent public functions, as well as their immediate family members and close associates. The designation recognizes an elevated risk of bribery, corruption, and misuse of funds, and therefore warrants enhanced due diligence by financial institutions and other obliged entities.
Categories: PEPs can be domestic (holding a public function in the same country), foreign (in another country),
Regulatory framework: The concept is anchored in international standards, notably the FATF recommendations, which require a
Practical implementation: On onboarding, institutions screen customers for PEP status, assess risk, collect additional information on
Duration and dynamic: PEP status typically applies for the period of holding the office and, in many
Criticism and challenges: PEP rules raise privacy concerns and can lead to misidentification or excessive scrutiny.
See also: Money laundering, AML/CFT, FATF, financial regulation.