On 18 July 2024, the Financial Conduct Authority (FCA) has instructed UK financial institutions to ensure that politically exposed persons (PEPs), including parliamentarians and senior public servants, along with their families, are not subjected to unfair treatment. Following a review, the FCA found that while firms generally did not impose excessive checks on PEPs, improvements were needed. Firms are advised to refine their definition of PEPs, reassess PEP status promptly after they leave public office, communicate clearly with PEPs, and tailor information requests to the level of risk.
Enhanced staff training is also recommended. The FCA has begun a more detailed review of certain firms' practices. Changes proposed by the FCA include treating UK PEPs as lower risk, clarifying the status of non-executive board members in civil service departments, and offering more flexibility in managing PEP relationships. The FCA urges firms to implement improvements immediately rather than waiting for the final guidance, which is open for consultation until 18 October 2024.
Source: FCA