What is a ‘politically exposed person’ (PEP)?
A politically exposed person (PEP) refers to an individual – whether foreign or domestic – with a prominent public function, as well as his or her family members and close personal or business associates. Examples of PEPs include heads of government or heads of state, senior politicians and government officials, military or judicial officials, senior executives of state-owned organisations and high-up political party officials.
Because of their position and potential influence, PEPs often present a greater risk for involvement in such crimes as corruption and bribery.
Corruption is the misuse of power and position by an individual for personal gain. It can involve such acts as abusing their function, position or influence; extorting money or other articles of value; embezzling funds; self-dealing; and bribery. Corruption impacts political stability, economic development, the financial landscape, and crime.
Bribery, a form of corruption, is promising or giving something of value – such as money, position, privilege or preferential treatment – in return for corrupt behaviour. Bribing or attempting to bribe public officials – an unfortunately prevalent practice worldwide – is a crime with serious penalties for both individuals and organisations.
In today’s global business environment, it’s critical to minimise the legal and financial risks that PEPs present from impacting your organisation. To safeguard your company’s reputation and assets, it’s important to know whether you’re doing business with and how to handle PEPs, from employees to customers and partners. This means doing your due diligence to better understand your customers, your employees and your vendors.
A major part of these due-diligence efforts is conducting background checks to identify PEPs. A background check is a comprehensive review of an individual or an organisation for information including names, dates of birth, identification numbers, photographs, education, employment history, commercial activities, financial records and criminal records. Without the right resources, such checks can be time-consuming and overwhelming, as they involve using large databases to uncover reputable, factual information.
With robust background checks, you can identify PEPs before you establish a business relationship with them, as well as monitor your current employees, partners and customers for potential legal, financial or reputational risks.
In today’s world, keeping up with government sanctions lists and PEPs is more challenging than ever, but ultimately, your reputation – and your business – depends on it.
Mitigate your reputational risk with due-diligence solution Nexis Diligence™. Conduct robust background checks supported by more than 26,000 news sources and an archive that reaches back more than 40 years. Gain access to major watchlists, more than 1,000 sanctions lists, international court cases, risk-analysis reports, biographical sources and information on more than 1 million PEPs.
Nexis Diligence™ gives you all the business intelligence you need in one place to conduct consistent due-diligence checks and comply with anti-bribery and corruption (ABC). And the tool’s due-diligence report builder provides you with a verifiable audit trail that enables you to illustrate your ongoing regulatory compliance efforts.
What’s more, by virtue of having a comprehensive picture of the people and companies with whom you do business, you’ll improve your decision-making power and be able to act with confidence.
LexisNexis Diligence Spotter®
The software lets you capture a real-time daily assessment of your business risk, so you can ramp up your due-diligence efforts as needed. Diligence Spotter® also allows you to incorporate additional internet research into your screening process, so you can be rest assured that as regulations evolve, Diligence Spotter® will keep up.