On August 21, the Financial Crimes Enforcement Network (FinCEN),
together with the federal banking agencies1 (the
Agencies), released a statement (Statement) to clarify banks'
customer due diligence (CDD) obligations for politically exposed
persons (PEPs).
The Statement affirms that (i) there is no regulatory
requirement, and no supervisory expectation, for banks' Bank
Secrecy Act (BSA) / anti-money laundering
(AML) programs to include “unique,
additional due diligence steps” for customers who are PEPs
and (ii) there is no regulatory requirement for banks to screen
customers and their beneficial owners for PEPs. Instead, the
Statement confirms that PEP customers should be subject to the same
risk-based approach to CDD that applies to any other customer, but
that PEP status (and screening for PEPs) may be a factor in
developing a customer risk profile and assessing money laundering
risk. It also reminds banks of the continued U.S. national
security and law
