The National Crime Agency (NCA) has new unexplained wealth orders (UWOs) against politically exposed persons (PEPs) in the pipeline, including against Russians, it said. This is triggering a possible significant need, identified by lawyers, for banks to undertake extra due diligence.
PEPs are defined for UWO purposes under the Proceeds of Crime Act 2002 (PoCA) as amended by the Criminal Finances Act 2017, slightly differently from in the Money Laundering Regulations 2017 (MLRs).
Under Section 362B (7) of PoCA, the main definition of a PEP is "an individual who is, or has been, entrusted with prominent public functions by an international organisation or by a state other than the United Kingdom or another EEA state". This is wider potentially than in the MLRs, where Regulation 35 (9) states that a PEP must be treated as a PEP after he or she leaves office for at least 12 months, depending on risk.
Russell Strong, senior solicitor, Zaiwalla & Co, agreed the definition in POCA created a wider pool of those falling within the definition of a potential PEP. "But neither definition can be said to be conclusive, particularly in connection with those 'otherwise connected' (PoCA) or a 'known close associate' (MLR 2017), A case-by-case assessment will always be required."
Read the full article in Thomson Reuters here.
