PEP (Politically Exposed Person)

A Politically Exposed Person (PEP) is an individual who holds or has held a prominent public function, such as a head of state, senior politician, or military official, and is therefore considered to present a higher risk of involvement in bribery and corruption, necessitating Enhanced Due Diligence (EDD) by financial institutions under Anti-Money Laundering (AML) regulations. This elevated risk profile is mandated by international standards, such as those set by the Financial Action Task Force (FATF) Recommendation 12, to prevent the abuse of the financial system for illicit purposes like money laundering and terrorist financing.