The update follows consultation from July to October 2024 on the proposed changes.
Key updates to the guidance include:
➡️ Definition: Greater clarification on who should and should not be considered a PEP, for example explicitly stating that non-executive board members should not be treated as PEPs;
➡️ Sign-offs: Improved flexibility on which members of senior management can sign-off PEP relationships using a risk-based approach;
➡️ Regulatory alignment: Changes reflecting updates to the Money Laundering Regulations in 2024, including the treatment of domestic PEPs as lower risk in the absence of high-risk indicators; and
➡️ Beneficial ownership: Clarifying that legal entities should not be treated as PEPs unless firms are satisfied that a PEP is exercising significant control.
✅ Firms should review their control frameworks in line with the new regulatory guidance, ensuring that PEP risks are promptly identified and reviewed via appropriate channels.
💡 Plenitude RegSight and its subscription newsletter keep you informed of the evolving regulatory landscape in the UK and its impacts for firms. Visit our website for more information: https://www.plenitudeconsulting.com/what-we-do/plenitude-regsight/