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2024 politically exposed persons examination feedback
2024 politically exposed persons examination feedbackExecutive summary
In November 2023, we published an industry update outlining our plan to conduct a thematic examination on how supervised persons were meeting their obligations regarding politically exposed persons (PEPs). The examinations took place during the first half of 2024.
The two main reasons for selecting this theme were:
- the island’s exposure to the higher risks of conducting business with customers who are either PEPs or who have a PEP connection, highlighted in the 2023 update to Jersey’s National Risk Assessment: Money Laundering (2023)
- the recent changes to Article 15A of the Money Laundering Order which enables a supervised person to declassify a PEP, provided certain requirements are met
We examined a cross section of industry including accountants, banks, fund services business, investment businesses and trust company service providers. The graph below represents the spread across these sectors:
The findings from this thematic examination indicate that supervised persons should be considering their own arrangements for PEP customers but specifically:
The changes to the Money Laundering Order to enable the declassification of PEPs, with different timeframes depending on the type of PEP, came into force in September 2023. Supervised persons overall had implemented adequate policies and procedures addressing differing declassification requirements depending on the type of PEP and were performing and documenting risk assessments prior to declassifying PEP customers.