A Politically Exposed Person (PEP) includes which of the following?

• A. A person with a prominent public function
• B. A family member of a person in public office
• C. A close associate of a PEP
• D. All of the above

Answer: (D)

The concept being tested is who qualifies as a Politically Exposed Person for anti-money-laundering purposes. A PEP includes the person who holds or has held a prominent public function, recognizing the higher risk of misuse of public office. The definition also extends to people closely connected to that person—family members and close associates—because they may be used to facilitate actions that involve illicit activity or conceal assets. So the scope covers the PEP themselves, their family members, and their close associates. That’s why all of the above are included in the PEP category. In practice, this means a current or former public official, a relative of such an official, and a person with a close business or personal relationship to the official would all require enhanced due diligence.