Who is considered a family member of a PEP?

A family member of a Politically Exposed Person (PEP) includes individuals who are closely related to, or connected with, a PEP. This typically encompasses:

  • Immediate Family Members:
    • Spouses or partners: Recognized legally or by common law as married or partnered to the PEP.
    • Children: Biological, adopted, or stepchildren of the PEP, and their spouses or partners.
    • Parents: Biological, adoptive, or stepparents of the PEP.
  • Extended Family Members:
    • Siblings: Brothers and sisters of the PEP, including half-siblings and their spouses or partners.
    • Grandparents and Grandchildren: Including the spouses or partners of grandchildren.

Importance of Identification: Identifying family members of PEPs is crucial for financial institutions and other obligated entities under anti-money laundering (AML) regulations. This is because family members may pose similar risks as PEPs themselves, potentially being involved in activities that could exploit their relationship for financial gain or to circumvent legal and regulatory requirements. Enhanced due diligence measures are often required when engaging in transactions or business relationships with family members of PEPs to mitigate these risks.