Assessment
A national information system would improve access to information on politically exposed persons

Entities obliged to carry out customer due diligence under the Act on Preventing Money Laundering and Terrorist Financing would have better access to information on politically exposed persons if the information were processed using a centralised national information system. The Ministry of Finance is requesting comments on its assessment of the matter.

Under the Act on Preventing Money Laundering and Terrorist Financing, a politically exposed person (PEP) is a person who is entrusted with prominent public functions. The act obliges certain entities to have appropriate procedures in place to determine whether a customer is a politically exposed person or a family member or close associate of a politically exposed person. The purpose is, among other things, to prevent the misuse of public power.

At present, the act does not provide for means by which obliged entities could obtain reliable information on this matter with reasonable effort and reasonable costs. 

More reliable and timely information

The Ministry of Finance assessed how information on politically exposed persons could be processed using a national information system. The objective would be to improve the availability, completeness, reliability and timeliness of information that obliged entities require to carry out customer due diligence.

In order to ensure the accuracy of information, the Ministry looked at setting a statutory disclosure obligation for various parties or collecting information from existing databases.

The Ministry of Finance assessed the collection and storage of personal data in a national information system. The Ministry’s assessment took into account the regulation of data protection, including national regulatory room for manoeuvre. 

In order to improve the access of obliged entities to information, the information system would also need to process personal data of family members and close associates of politically exposed persons. This could be done when justified and necessary to carry out customer due diligence. 

A register or inquiry-based system

There are two alternatives for implementing a centralised national information system.

• Register: information would be stored in a database.
• Inquiry-based, distributed system: obliged entities would make a one-off inquiry on the status of a customer to the parties participating in the system.

The Ministry of Finance’s assessment is that the most suitable data controllers would be the Digital and Population Data Services Agency and the Finnish Patent and Registration Office.

Consultation round begins

The Ministry of Finance requested comments on the assessment on 2 January. The deadline for comments is 13 February.

After the consultation round, Minister of Economic Affairs Wille Rydman will decide whether the Ministry of Finance will continue studying the matter. 

Inquiries:
Ida-Ellen Kaski, Senior Specialist, tel.  +358 295 530 040, ida-ellen.kaski(at)gov.fi