A politically exposed person (PEP) is an individual who is or has been entrusted with a prominent function by a local, regional, national or international governmental body. Given the global mobility of PEPs, our database covers high-ranking government officials in every active jurisdiction. Red Flag Alert provides a comprehensive and widely-adopted source of structured intelligence on PEPs and heightened risk individuals and organisations.
Red Flag Alert aligns its PEP definition and categorisation with the guidelines provided by the Financial Action Task Force (FATF). FATF is an inter-governmental body established in 1989 by the Ministers of its member jurisdictions.
The FATF currently comprises 37 member jurisdictions and 2 regional organisations, representing most major financial centres in all parts of the globe. The objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.
Because of the risks associated with PEPs, the FATF Recommendations require the application of additional AML/CFT measures to business relationships with PEPs. These requirements are preventive (not criminal) in nature, and should not be interpreted as meaning that all PEPs are involved in criminal activity, or even necessarily pose a high risk of money laundering. Further legislation around the world, including the EU’s 4th money laundering directive, mandates enhanced due diligence requirements when dealing with all politically exposed persons.
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