Financial Crime World

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Politically Exposed Persons Screening in Syrian Arab Republic: A Critical Compliance Requirement

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The Syrian Arab Republic, a country with a complex history of corruption and money laundering, presents unique challenges for financial institutions looking to navigate the intricate world of politically exposed persons (PEPs) screening. In this article, we will delve into the definition of PEPs, the importance of proper screening, and the minimum data quality standards required for effective PEP screening in Syria.

Definition of Politically Exposed Persons

A Politically Exposed Person (PEP) is an individual who holds a prominent public position or has a close family member holding such a position. This includes:

  • Heads of state
  • Senior politicians
  • Government ministers
  • Judges
  • High-ranking military officials
  • High-ranking executives of state-owned enterprises

Importance of Proper Screening

Proper PEP screening is crucial in preventing the laundering of proceeds from corrupt activities. In Syria, where corruption is rampant, it is essential that financial institutions verify the identities of their customers to prevent the misuse of the financial system.

Minimum Data Quality Standards Required for Effective PEP Screening

The Wolfsberg Group recommends that financial institutions have complete and accurate customer data records and that the PEP database used for screening contain sufficient unique identifying data. This includes:

  • Name (all known names and aliases)
  • Date of Birth, and where this isn’t available, Year of Birth
  • Country of political exposure
  • Gender (where available)
  • Politically exposed role(s), and date(s) or year(s) of appointment
  • Date or year that the PEP left their position (where applicable)
  • Where applicable, if the PEP is deceased

Having good customer records and a PEP database that can be screened using unique identifying data will reduce the number of false positives and the overall burden on compliance teams.

Advice on Screening for PEPs

When screening for PEPs in Syria, consider the following:

  • Use native character searching. Searching for names in their native language greatly reduces false positives by limiting transliteration issues.
  • Use geography to help determine risks—not all countries pose the same risk. Lower-risk countries present the opportunity to reduce the amount of time spent reviewing close associates and relatives.
  • Reduce the number of hits you receive by using date of birth and age to refine your search.
  • Utilizing a defined set of risk factors, build or implement a third-party PEP risk-scoring model that works for your organization. For each risk category, weigh the risk factors and then build a defensible risk-scoring process.

For additional information regarding PEP scoring benefits, view our proprietary PEP Scoring Solution. In addition to helping to streamline your screening processes, our solution can help to reduce your false positives by up to 50%.

How Long is a PEP Considered a PEP?

When looking to see if you need to screen someone for being a politically exposed person, it is important to consider when and for how long they were in office. According to the Wolfsberg Group, there is no agreed method for determining the time period that an individual should be regarded as a PEP after they have left the public function.

Conclusion

Proper screening for PEPs in Syria is crucial in preventing the laundering of proceeds from corrupt activities and maintaining compliance with international regulations. By following the minimum data quality standards required for effective PEP screening and using native character searching, geography, date of birth, age, and a third-party risk-scoring model, financial institutions can ensure that their customers are properly vetted and reduce the number of false positives.

Contact us today to learn more about how our sanctions and watchlist screening solution and PEP Scoring Methodology can help you streamline compliance while reducing your PEP-related false positives.