Evaluating foreign PEP information is often more time consuming, expensive and difficult as:
- Coordinating a thorough investigation across multiple time zones will increase costs
- Business and financial records may not be easily accessible
- KYC team may not have experience in determining veracity of foreign documents
- Documents may be in another language
- Key contact persons for verification may speak a different language
If an institution cannot adequately complete KYC of a foreign PEP, it risks paying for it later. A non-exhaustive list of steps that should be taken in addition to regular KYC, are:
- Understanding the intended nature of the business relationship and likely turnover
- Verifying sources of funds through both government and private sources
- Increasing the number and frequency of controls
- Asking the PEP to self-identify potential areas of conflict