BANKS NEED OKAY TO DEAL WITH POLITICALLY EXPOSED PEOPLE

The Reserve Bank of India (RBI) has said banks should obtain senior management approval to continue business relationship with an existing customer who has subsequently become a politically exposed person and that banks should conduct customer due diligence (CDD) on politically exposed people (PEP). RBI has defined politically exposed persons as those individuals who are or have been, entrusted with prominent public functions in a foreign country such as heads of states or of governments, senior politicians, senior government or judicial or military officers, senior executives of state-owned corporations or important political party of India. RBI had advised banks to gather information on any person of this category desiring to do business with the bank and check all
the information available on the person in the public domain.