Assistance in passing compliance checks

Undoubtedly, an individual, irrespective of a type of activity, status or position, has the right to the private life, family, property etc., However, when it comes public figures, also known as PEPs (politically exposed persons), such individuals succumb to special conditions of processing any transactions, opening of bank accounts or incorporation of business.

The issue of publicity affects not only business reputation and personal image, but also ensures close attention to the property of the public figure.

Once a PEP — always a PEP

A person who has become a politically exposed person may be deemed a politically exposed person indefinitely

Thus, the status of PEP remains associated with the individual indefinitely. This principle is also affixed in the Law of Ukraine “On Prevention and Counteraction to Legalization (Laundering) of the Proceeds of Crime or Terrorist Financing and Financing Proliferation of Weapons of Mass Destruction” (by the way, earlier legislation limited the status of PEP only to 3 years).

It should be noted that not only PEPs, but also members of their families and affiliated persons (for example, business partners) are within the list of people exposed to special attention from financial monitoring authorities.

During compliance checks, the subjects of primary financial monitoring are obliged to obtain an addition permission of the superior in order to approve business relations with such individual and for performance of transactions in amount equal or exceeding a threshold (normally UAH 400 000); to take sufficient measures to establish a source of material assets and funds; to undergo permanent acute monitoring of business relations and also to report to state financial monitoring authority of financial transactions by the PEP, as well as  members of families and/or affiliated persons.

The recommendations of VigoLex when completing compliance checks are:

ü  To take the habit of systematic collection of documents confirming sources of financial incomes. Often are the cases when paperwork on income received several years ago is being requested. The lack of such documents may cause refusal to process transactions.

ü  To plan important financial transactions in advance due to processing of certain financial operation may be delayed due to additional documentary checks.

ü  “Special” conditions of completion of compliance checks are applicable not only to PEPs, but also to their family members, affiliated persons and legal entities, where PEPs act as beneficiaries. At this stage it is difficult to do without the assistance of the qualified lawyers since it is necessary to oversee all relations with business structures and family members.

As a rule, having competent approach and timely legal aid of VigoLex law firm, procedures of compliance checks are completed smoothly and predictably. Experience of VigoLex lawyers enables foresight of many possible obstacles and preparation of the client for any occurrences.

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