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September 8
Checkup for your RDC Program;
Susan Orr

September 10
Critical Issues on Certificates of Deposit;
Deborah Crawford

September 16
S.A.F.E. Act - Auditing for Compliance;
Patricia Cashman

September 22
FinCEN's Beneficial Owners Proposal: What It Can Mean for You;
Sonja Kriegsmann and John Burnett

September 23
Bankruptcy 101;
Sam Ott

September 24
Using CPTED to Make Our Banks Safer;
Dana Turner and Carol Dodgen



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#1767319 - 12/13/12 02:55 PM OFAC PEP list
t0dd Offline
100 Club

Registered: 09/28/04
Posts: 109
Our current core processor does not check our customers against the PEP list nor do they check against the list at account opening. From my understanding this is a requirment of the regulation. Looking for feedback as to how other financial institutions are handeling this part of OFAC requirments.

Thanks!

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BSA/AML/CIP/OFAC
#1767328 - 12/13/12 03:06 PM Re: OFAC PEP list [Re: t0dd]
rlcarey Offline
10K Club

Registered: 07/16/01
Posts: 49739
Loc: Galveston, TX
There is no "PEP" list and there is no requirement to check for PEPs. Part of your BSA risk due diligence process however, would be to identify them.
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The opinions expressed are my own, take them or leave them.

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#1767331 - 12/13/12 03:10 PM Re: OFAC PEP list [Re: t0dd]
t0dd Offline
100 Club

Registered: 09/28/04
Posts: 109
So how would we idnetify them if there is no list?

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#1767334 - 12/13/12 03:14 PM Re: OFAC PEP list [Re: t0dd]
rlcarey Offline
10K Club

Registered: 07/16/01
Posts: 49739
Loc: Galveston, TX
There is no official government list, but some vendors have their own that they have created through various sources. Many banks just flat out ask if dealing with a NRA.
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The opinions expressed are my own, take them or leave them.

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#1767337 - 12/13/12 03:17 PM Re: OFAC PEP list [Re: t0dd]
t0dd Offline
100 Club

Registered: 09/28/04
Posts: 109
OK then so since there is no official list how would we then identify them?

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#1767339 - 12/13/12 03:18 PM Re: OFAC PEP list [Re: t0dd]
rlcarey Offline
10K Club

Registered: 07/16/01
Posts: 49739
Loc: Galveston, TX
I edited my post above.
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The opinions expressed are my own, take them or leave them.

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#1767344 - 12/13/12 03:29 PM Re: OFAC PEP list [Re: rlcarey]
edAudit Offline
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Registered: 07/18/08
Posts: 2872
Loc: You are here
And now FIBCEN wishs to include domestic PEPs. eek
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Opinions can be considered as coming from anywhere but my employer.

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#1767352 - 12/13/12 03:43 PM Re: OFAC PEP list [Re: t0dd]
rlcarey Offline
10K Club

Registered: 07/16/01
Posts: 49739
Loc: Galveston, TX
That movement was not initiated by FinCEN, that is part of the FATF recommendations.
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The opinions expressed are my own, take them or leave them.

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#1767355 - 12/13/12 03:49 PM Re: OFAC PEP list [Re: t0dd]
Kathleen B Online

10K Club

Registered: 12/27/00
Posts: 17348
Originally Posted By: t0dd
So how would we idnetify them if there is no list?

Banks run vendor lists (some very expensive, suitable for higher risk situations) and at account opening ask if the individual or any close relative or friend has a role in foreign government or military.
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Kathleen Blanchard CRCM "Kaybee"
Lending/CRA/HMDA/Mapping/Consulting
www.kaybeescomplianceinsights.com

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#1767366 - 12/13/12 04:14 PM Re: OFAC PEP list [Re: t0dd]
MagicCity Offline

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Registered: 04/28/03
Posts: 2835
Loc: Fort Lauderdale, Florida
And if you have concerns on a particular individual you can Google him, or go to the CIA list of World Leaders.
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#1767610 - 12/14/12 01:41 PM Re: OFAC PEP list [Re: t0dd]
It's OK Offline
Gold Star

Registered: 11/07/11
Posts: 311
Loc: LA USA
Recently, when running an OFAC check before cashing a check for a non-customer, a person's name hit as a PEP. It didn't provide the PEPs date of birth or any other information for us to know for sure that we could have been dealing with the person identified.

The non-customer was turned away because their "name came up."

I was under the impression that we can do business with a PEP, we just have to identify them. I'm not sure this person should have been denied having the check cashed.
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#1767628 - 12/14/12 01:59 PM Re: OFAC PEP list [Re: t0dd]
rlcarey Offline
10K Club

Registered: 07/16/01
Posts: 49739
Loc: Galveston, TX
There is no law against doing business with a PEP. They are just high risk customers and should be appropriately monitored.
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The opinions expressed are my own, take them or leave them.

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#1767661 - 12/14/12 02:46 PM Re: OFAC PEP list [Re: t0dd]
Kathleen B Online

10K Club

Registered: 12/27/00
Posts: 17348
And there certainly is nothing that says a check cannot be cashed for a non-customer supposed PEP.
_________________________
Kathleen Blanchard CRCM "Kaybee"
Lending/CRA/HMDA/Mapping/Consulting
www.kaybeescomplianceinsights.com

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#1767664 - 12/14/12 02:49 PM Re: OFAC PEP list [Re: t0dd]
It's OK Offline
Gold Star

Registered: 11/07/11
Posts: 311
Loc: LA USA
thank you both for the information. I will pass this along.
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#1767682 - 12/14/12 03:04 PM Re: OFAC PEP list [Re: t0dd]
Kathleen B Online

10K Club

Registered: 12/27/00
Posts: 17348
Banks must have a good undertanding of the lists being checked and plans on how to repond for each.
_________________________
Kathleen Blanchard CRCM "Kaybee"
Lending/CRA/HMDA/Mapping/Consulting
www.kaybeescomplianceinsights.com

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#1767807 - 12/14/12 07:45 PM Re: OFAC PEP list [Re: t0dd]
Princess Romeo Offline

Power Poster

Registered: 06/01/01
Posts: 7603
Loc: Where the heart is
As stated above, there is no official "PEP" list. Generally speaking, if you are dealing with a U.S. citizen, you usually don't have to be concerned about a potential PEP unless you know that your customer is the spouse, child, relative or paramour of a powerful foreign dignitary.

How would you know? Well - extreme amounts of money flowing through their accounts would be one tip-off. Also, extravagant clothes, jewelry, cars with no domestic support would be another.

If you are dealing with a non-resident alien, part of your account opening procedures would be to simply ask:

Quote:
Are any of your parents or relatives an elected official or hold a politically appointed position in a foreign country?


Beyond that - the issue with PEPs is that they can aid in looting the treasury of a country, or skimming taxes or foreign aid money, etc. Now if they do that, you would see some significant amounts going through their account, and the explanations probably won't add up. So it all goes back to KNOW THY CUSTOMER and UNDERSTAND what their business is, how they earn their money, and so on.

There is no magic bullet to this, but a lot of this is just common sense and listening to your gut, or that funny feeling, or the hairs prickling on the back of your neck.
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CRCM,CAMS
Regulations are a poor substitute for ethics.
Just sayin'

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#1767855 - 12/17/12 07:31 AM Re: OFAC PEP list [Re: It's OK]
Ken_Pegasus Offline
10K Club

Registered: 08/30/01
Posts: 17272
Loc: Another trip around the sun
Quote:
Recently, when running an OFAC check before cashing a check for a non-customer, a person's name hit as a PEP.


Reviewing the OFAC list before cashing an on-us check has nominal compliance value and should be supported by evidence that the institution is "high risk" for an OFAC violation. Looking for PEPs in that same process is of no value. I suggest you dial back your searches.
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The world is not a wish granting factory. Hazel Grace Lancaster

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#1768936 - 12/19/12 01:45 PM Re: OFAC PEP list [Re: t0dd]
It's OK Offline
Gold Star

Registered: 11/07/11
Posts: 311
Loc: LA USA
We also had the wife of a former governor appear when we ran a non-customer's name. The name that was input was very similar to the former governor's wife's name, and "PEP" was indicated in the results.

Since PEPs are referring to foreign government officials & their family members, I was confused about why that name would appear.
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#1768984 - 12/19/12 03:02 PM Re: OFAC PEP list [Re: t0dd]
edAudit Offline
Power Poster

Registered: 07/18/08
Posts: 2872
Loc: You are here
FINCEN has been "discussing" domestic PEPs as another avenue for the banks to review and possibly risk rate. I would check with your provider to see if this is what trigered your hit.
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Opinions can be considered as coming from anywhere but my employer.

CAMS


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#1769027 - 12/19/12 03:54 PM Re: OFAC PEP list [Re: t0dd]
It's OK Offline
Gold Star

Registered: 11/07/11
Posts: 311
Loc: LA USA
Ok, thanks for the info.
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