What are Politically Exposed Persons (PEPs)? 

Broadly, the concept of a Politically Exposed Person (PEP) refers to individuals who currently hold or have held political power.

Due to the interwoven nature of politics and private capital, governments and financial institutions worldwide agree that PEPs represent an increased money-laundering risk. This is because individuals who hold political power can abuse their power to engage in money laundering and other financial crimes like corruption, bribery, embezzlement and the financing of terrorism.

There are many types of PEPs with their own special designations and compliance obligations that companies must scan for to remain compliant. Other types of PEPs include Domestic Prominent Influential Persons (DPIPs) and Foreign Prominent Public Officials (FPPOs). 

To read our comprehensive guide on Politically Exposed Persons, click here. 

Why Political Elections Increase the Risk of AML/CFT Non-Compliance 

Political elections, especially on the national/presidential levels, can drastically transform a country’s political landscape. If there is a major transfer of power, a country’s leaders, members of parliament, diplomats and junior party members can all be reshuffled or placed in positions of power for the first time ever. 

This means that a country can suddenly gain hundreds of new individuals who classify as PEPs. Furthermore, every family member and close associate of these PEPs must also be noted and will often classify as PEPs themselves, making the new lists even longer. 

South Africa’s 2024 election has the potential to drastically change the political landscape. The political order in cities, provinces and the entire country has the potential of changing significantly – cities, provinces and the entire country may change leadership. 

This means that South Africa’s lists of who is a PEP and who is under sanction may change drastically in a very short amount of time – a change that poses a risk for continued AML/CFT compliance. 

This risk is further complicated by the variety of other elections that are happening around the world in 2024. This is because sanctions screening is done internationally, which means that a company’s AML/CFT compliance must consider and adapt to global political changes – sanctions screening must, therefore, always be done on international sanctions lists. 

To find out more about ThisIsMe’s sanctions screening solutions, read our comprehensive overview here.  

Other Major Elections Happening in 2024 – Regional Overviews 

• Africa (South Africa, Mali, Madagascar, Algeria, Ghana, Mozambique, Chad, Rwanda)
• Middle East (Pakistan, Iran, Syrian Arab Republic)
• Europe (European Union, United Kingdom, Ukraine, Romania)
• The Americas (United States of America, Mexico, Venezuela)
• Asia (India, Indonesia, Bangladesh, Russian Federation, North Korea, Taiwan)

Arguably the highest profile election set for 2024 is the United States presidential election in November 2024. However, all of the other elections listed above, as well as the many others that are not included, will all have a significant impact on AML/CFT compliance obligations. 

How to Stay Compliant with AML/CFT Laws – The Importance of Ongoing Monitoring 

The cost of not staying compliant with AML/CFT laws is immense. Punishments for non-compliance range from fines that can total in the millions of dollars, all the way to prison time for the compliance officers who are responsible for ensuring continued regulatory compliance. 

Ongoing monitoring – a solution offered by ThisIsMe – constantly checks a list of individuals and entities against international sanctions lists. 

This means that your company does not have to worry about always checking these sanctions lists in order to stay compliant; all of those checks are done in the background, thereby keeping your company secure and compliant. 

Sanctions Scanning and Ongoing Monitoring Solutions for South Africa 

As South Africa’s leading provider of world-class identity verification, data validation and due diligence solutions, ThisIsMe is proud to be at the forefront of a trust-based and privacy-compliant digital world. To experience our full suite of solutions and experience how we can help your business meet its regulatory compliance obligations, book a demonstration by contacting our team here.