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<p>The Money Laundering Regulations 2017 require firms in regulated sectors, including
those regulated by the Gambling Commission, to obtain and verify certain information
about their customers. Firms must have in place appropriate risk management systems
and procedures to determine whether a customer is a Politically Exposed Person (PEP),
or a family member or known close associate of a PEP. This is in line with the international
standards set by the Financial Action Task Force.</p><p>Original measures on PEPs
were put into UK law via the transposition of the European Union’s fourth money laundering
directive in June 2017, as was the legal requirement at the time. There was therefore
no risk assessment undertaken specifically by the UK but the impact assessment from
this process can be found <a href="https://www.legislation.gov.uk/ukia/2017/118/pdfs/ukia_20170118_en.pdf"
target="_blank">here</a>. The Financial Action Task Force is the international standard-setter
in anti-money laundering and counter terrorist financing, and its guidance on PEPs
can be found <a href="https://www.fatf-gafi.org/documents/documents/peps-r12-r22.html"
target="_blank">here</a>.</p><p>HM Treasury is currently undertaking a review of the
2017 Regulations. As part of this review, the proportionality of current requirements
regarding domestic PEPs is being considered and balanced alongside the risks posed
to the UK’s financial system, and our international obligations to mitigate these
risks. The Review will be published this summer.</p>
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