UK domestic PEPs: now "officially" lower risk

10 January 2024 saw commencement of the Money Laundering and Terrorist Financing (Amendment) Regulations 2023 (Amending Regulations), which provide for changes to the enhanced due diligence (EDD) requirements in relation to so-called domestic PEPs (i.e. a politically exposed person entrusted with prominent public functions by the UK). Specifically, the Amending Regulations amend regulation 35 of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs) to require that the 'starting point' of any assessment of the risk posed by a domestic PEP is that they pose a lower risk than a foreign PEP. Susannah Cogman of Herbert Smith Freehills discusses the background to this change, explains the new requirements, and considers the UK Financial Conduct Authority's related work on PEPs.

Susannah Cogman (+44 (0)20 7466 2580, susannah.cogman@hsf.com) is a partner at Herbert Smith Freehills.

10 January 2024 saw commencement of the Money Laundering and Terrorist Financing (Amendment) Regulations 2023 (Amending Regulations), which provide for changes to the enhanced due diligence (EDD) requirements in relation to so-called domestic PEPs (i.e. a politically exposed person entrusted with prominent public functions by the UK). Specifically, the Amending Regulations amend regulation 35 of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs) to require that the 'starting point' of any assessment of the risk posed by a domestic PEP is that they pose a lower risk than a foreign PEP. Susannah Cogman of Herbert Smith Freehills discusses the background to this change, explains the new requirements, and considers the UK Financial Conduct Authority's related work on PEPs.