FROM A
DIFFERENT ANGLE by Kenneth Rijock
Financial Crime Consultant, for World-Check
An Important lesson about Reputation Damage & PEPs
18 November 2009

If you read page one on America's most prominent newspapers today, you saw that a PEP from one of the world's most reputedly corrupt countries has been reportedly able to gain easy entry into the USA, notwithstanding that he should not be granted a visa. What many readers also saw was the apex of reputation damage; two prominent US banks named for banking this individual's millions, and happily moving his money, even though it was common knowledge that the source of funds allegedly consisted of bribes and other illegal payments. Think damages to reputation, squared. 

Compliance officers at US banks should think long and hard about recommending to their board of directors that PEPs from blatantly corrupt dictatorships should be universally declined as clients. To do otherwise invites exposure, by name, by the global media, complete with photographs of the PEPs multi-million dollar toys.

I fully understand that such clients bring extremely lucrative business into the bank, but, in an age where FCPA indictments are increasing exponentially, the likelihood that your client's millions (in your accounts) constitute the proceeds of crime are probable at worst. The times are changing; get with the programme, or risk having your bank's name strewn all over page one.

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The facts and opinions stated in this article are those of the author and not those of World-Check. World-Check does not warrant the accuracy of any facts and opinions stated in this article, does not endorse them, and accepts no responsibility for them.

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