PEP (Politically Exposed Persons) Screening

1. Purpose

This policy (Ref: COMP-KYC-005) establishes the Bank's requirements for the identification, screening, and ongoing management of Politically Exposed Persons (PEPs), their family members, and known close associates (RCAs). PEPs represent an elevated money laundering and bribery/corruption risk, and enhanced measures are required under AMLD6, FATF Recommendation 12, and FCA guidance.

2. Definition of PEP

A Politically Exposed Person is a natural person who is or has been entrusted with a prominent public function. This includes, but is not limited to:

• Heads of State, heads of government, ministers, and deputy or assistant ministers.
• Members of parliament or equivalent legislative bodies.
• Members of the governing bodies of political parties.
• Members of supreme courts, constitutional courts, or other high-level judicial bodies.
• Members of courts of auditors or boards of central banks.
• Ambassadors, chargés d'affaires, and high-ranking officers in the armed forces.
• Members of the administrative, management, or supervisory bodies of state-owned enterprises.
• Directors, deputy directors, and members of the board of international organisations.

2.1 Family Members

Family members of PEPs include: spouse or partner, children and their spouses/partners, and parents.

2.2 Known Close Associates (RCAs)

RCAs include any natural person known to have joint beneficial ownership of a legal entity or arrangement with a PEP, or who has a close business relationship with a PEP, or who is the sole beneficial owner of a legal entity known to have been set up for the benefit of a PEP.

3. Screening Requirements

3.1 Timing of Screening

PEP screening must be conducted at the following points:

3.2 Screening Tools

The Bank uses the approved PEP and sanctions screening platform as designated by the Compliance Department. The screening tool must cover domestic and foreign PEPs and must be updated at least weekly by the data provider.

3.3 Alert Management

All PEP screening alerts must be reviewed and dispositioned by the KYC Operations Team within five (5) business days. Confirmed PEP matches must be escalated to the Compliance Department for risk assessment and approval.

4. Enhanced Due Diligence for PEPs

All confirmed PEP relationships (including family members and RCAs) are automatically classified as high risk and are subject to Enhanced Due Diligence measures, including:

• Senior Management Approval — The relationship must be approved by a Senior Manager (VP level or above) before onboarding or continuation.
• Source of Funds and Source of Wealth — Detailed evidence must be obtained and verified to establish the legitimacy of the PEP's wealth and the funds flowing through the account.
• Enhanced Ongoing Monitoring — Heightened transaction monitoring thresholds must be applied, with reviews conducted no less than every six (6) months.
• Adverse Media Monitoring — Continuous or high-frequency adverse media screening must be applied throughout the relationship.
• Annual Review — The relationship must be reviewed annually, with documented re-approval by Senior Management.

5. De-Classification of PEPs

A customer who ceases to hold a prominent public function does not automatically lose PEP status. The Bank must continue to apply EDD measures for a minimum period of eighteen (18) months following the cessation of the public function, and must assess on a risk-sensitive basis whether the individual continues to present an elevated risk beyond that period.

6. Domestic PEPs

In accordance with AMLD6, the Bank applies EDD to both foreign and domestic PEPs. Domestic PEPs are subject to the same identification, screening, and enhanced measures as foreign PEPs.

7. Record Keeping

All PEP screening results, risk assessments, Senior Management approvals, and ongoing monitoring records must be retained for a minimum of five (5) years following the termination of the relationship.

8. Review

This policy is reviewed annually. Next review: Q1 2027.