Thursday, December 8, 2011


You are performing due diligence on a wealthy individual who wishes to open an account relationship with your bank. He plans on moving his substantial accounts over to you, but first, have you ruled out that he may just be a clever PEP, who is in reality fleeing a North African country that just became part of the Arab Spring ?

I hear you say that his passport is not from a Middle East country. Have you:

(1) Checked to see what's in the passport he is showing you ? I know that you have already verified its authenticity, using Passport-Check, or some other resource, but are there sufficient visa stamps in it to
indicate international travel during the last five years ? Is it basically clean ? Perhaps he holds dual nationality. is this passport new ?

(2) Where does it say is his place of birth ? is it in a Middle East country, even though his proffered passport is from outside that region.

(3) What about his accent ? Does it agree with his professed nationality ? is he comfortable speaking the language that you would expect, given the jurisdiction he says he is coming from ?

I am making these points to alert you to the possibility that a new client might just be in flight from one of the newly-emerging democracies in the Middle East, and that his wealth was stolen, obtained through bribes or kickbacks, or through some preferential business operated as a virtual monopoly in his home country. The new government in his country may soon be wanting that money back, leaving you with
reputation damage you could have avoided.

The lesson: ensure, through effective due diligence such as is detailed above, that you are not taking in some corrupt PEP, human rights violator, or an enemy of the state. Rule out any chance that he is a PEP on the run from North Africa, before accepting his money, please.


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