B. Politically Exposed Persons (PEPs)

To determine the level and degree of risk posed by a local PEP, the financial institution shall observe the requirements mentioned in Paragraph (1.1) under the ML/TF Risk Assessment Section . It may also rely on the following information: a) The period of time for which a local PEP has been entrusted with prominent public functions in Saudi Arabia or in a foreign country. b) Corruption risks associated with the entity where a local PEP occupies his position and the extent to which that entity is exposed to corruption risks. c) The customer's attempt to conceal or present inaccurate information related to the application of due diligence/enhanced due diligence, such as: - Concealing or providing inaccurate information related to the customer's job and the extent to which it is associated with high public positions or functions in Saudi Arabia or any foreign country. - Concealing or providing inaccurate information related to the source of income/wealth. d) Reliance on the family members of a local PEP or persons close to that person to act on his behalf. 4.16 The financial institution shall have sufficient, reasonable and documented grounds based on the ML/TF risk assessment results if it decides that a local PEP, their family members, or persons close to that PEP do not pose high risk from the AML/CTF perspective. 4.17 If it is established from protection and/or savings policies or investment- related insurance documents that a beneficiary or beneficial owner is a PEP, the financial institution shall take enhanced due diligence measures to mitigate risks before the payment of benefits or exercise of any rights under those documents. Such measures shall include the following: a) Notifying the senior management before the payment of benefits or exercise of any rights under those documents. b) Carrying out a thorough examination of the business relationship with the customer and considering reporting to the SAFIU in case of a suspicious transaction. The rights exercised by a customer under a policy may include: • Cancellation of the policy. • Cancellation of the policy during the free-look period. • Partial withdrawal of the investment amount. • Change of investment fund. • Payment of additional premiums. 4.18 If the financial institution fails to identify a PEP or has suspicions regarding a PEP, it shall include the following in its records: a) The measures taken to determine the customer type. b) Reasons for suspicions about the nature of the customer’s position or job or association with a PEP. c) Reasons why the measures did not work. d) The date on which the measures were taken.