The main concept in background checking, especially for employment, is that a one size fits all policy is never the best choice. Not everyone in an organisation requires the same level of scrutiny, and in general terms, the more senior the position, the more stringent the background checking. This might include DBS checks, credit checks, social media checks and in some cases, a PEP or Politically Exposed Person check.
PEPs are individuals who work or volunteer in prominent positions. This includes appointments by governments, international organisations, and even community groups. A PEP is someone who is high-profile and who is important to the business’s success or failure.
Who Qualifies as a PEP?
Identifying who is a PEP is important for risk management. Some categories of PEPs are obvious, others less so.
- Government employees – Members of Parliament
- Financial – people of influence in central banks and courts
- Diplomatic and Military – senior ranks and those in the diplomatic service
- Public Sector – people on the boards of public sector businesses or organisations
- Judges
Often, vetting for these groups of people extends beyond the person themselves and looks at immediate family and close friends, or into business or property associates.
How PEP Checks are Conducted
PEP checks are about preventing your company from engaging in financial crimes. PEP checks help mitigate the risks of corruption by enabling enhanced due diligence (EDD) on these individuals, making sure there is nothing lurking in their private life which might leave them vulnerable to blackmail or pressure from criminals either at home or overseas.
There are several stages to a PEP check and there is often some degree of secrecy over exactly how these are carried out. The main things which will be looked at for a PEP check are:
- Identity checking – looking at all the relevant key documents such as passport or utility bills to make sure someone is who they say they are.
- Identifying associates – asking about key contacts of the person involved. This will include family members, romantic partners, close friends and business contacts.
- Database scans – all the usual checks on government databases, or credit checks through financial services providers.
- Background checking on family members
- Social media screening
Why is a Politically Exposed Person (PEP) Check Important
There are many reasons why a company or government body might ask for a PEP check. The most common reasons are:
- Reduce the Risk of Bribery - PEP checks can identify individuals more susceptible to bribery attempts.
- Combat Money Laundering - PEP checks can reduce the risk of a business being caught up in anything illegal.
- Protect Reputation - Being involved in financial crimes can damage a company’s reputation. PEP checks demonstrate a commitment to ethics and deter people with bad intentions for even applying for a job.
Chances are that unless you are being hired into a very senior position with lots of responsibility, you won’t ever need a PEP check. If you do, the process will be fully explained at the time. Similarly, if you are named as a key contact or family member of someone who needs a check, the implications will be detailed at the time of the check.
