Regulatory Alerts2023-12-05
Instruction No. 03 of 2023, dated 21 Jumada El-Oula (December 5, 2023), regarding the obligations of regulated entities towards Politically Exposed Persons
The Financial Intelligence Processing Unit (CTR) issued Instruction No. 03 of 2023 to mandate that financial institutions and designated non-financial businesses implement risk-based due diligence procedures for Politically Exposed Persons (PEPs). Regulated entities must establish robust risk management systems, obtain competent authority approval before initiating or continuing PEP relationships, apply enhanced due diligence and strict monitoring, verify the origin of funds, and maintain detailed records. Additionally, entities must determine PEP status or beneficial ownership in life insurance contracts by claim payment, notify authorities before disbursement, conduct comprehensive relationship reviews, and file suspicious transaction reports when higher risks are identified.