FCC RegUpdate

On September 5, 2023, the UK Financial Conduct Authority (FCA) published the terms for its review of the treatment of domestic Politically Exposed Persons (PEPs) by financial services firms. This review is being conducted in compliance with Section 78 of the Financial Services and Markets Act 2023. The FCA’s review will carefully examine the arrangements of firms dealing with PEPs based in the UK and is set to deliver its report by the end of June 2024.

The review will consider the following notable aspects:

  • Implementation of the definition of PEPs by firms for individuals.
  • Conducting risk assessments for UK PEPs, their family members, and known close associates.
  • Effective application of enhanced due diligence and ongoing monitoring in alignment with risk.
  • Grounds for rejecting or closing accounts for PEPs, their family members, and known close associates.
  • Ensuring effective communication with PEP customers.
  • Reviewing PEP controls to ensure their effectiveness and suitability.