Director of Public Prosecutions Charles Leacock says it is in the interest of financial institutions to exercise due diligence in dealing with politically exposed persons (PEPs), who have become a focus in the global fight against corruption.
Leacock, a Queen’s Counsel, told a conference on money laundering that failure to do so could result in a number of risks to banking and financial institutions including damage to reputation and subjection to substantial fines.
“Failing to observe proper due diligence can result in not only reputational risk to your company or bank but also it can render you to become susceptible to regulatory control or even supervisory guidance from the central authorities,” he cautioned.
“And you don’t necessarily want to be placed in a straightjacket, largely for the purposes of your reputation and not being able to attract business to you as a clean entity,” added Leacock.
The island’s lead prosecutor said while there was no global definition of what PEPs were, they could refer to a current or former professional in executive, legislative, administrative, military office or those in higher judicial branches of the Government, senior officials in political parties and senior executives in state entities, their immediate families as well as any individual publicly or constructively known to be in close aid of such persons.
“You may wish to consider as an industry specific measure, those who have control or substantial access in the procurement area because those areas are reputed to be rather rife with the ability to make payments usually that are irregular,” he said.
Leacock was giving a presentation during the opening day of the eighth Anti Money Laundering And Combating The Financing Of Terrorism (AML/CFT) Compliance Conference last Thursday at the Frank Collymore Hall.
He was speaking on the topic Corruption, Politically Exposed Persons, Corporate/Country Risks And Lack Of Transparency.
