There are three statutory types
The AML/CTF Act recognises domestic, foreign and international organisation politically exposed persons. The definitions extend beyond a person's job title and include specified family and close business connections. An international organisation PEP can include a person with a prominent role in a public international organisation and specified connected individuals.
The type of PEP and their role in the customer relationship both matter. A PEP classification is a legal and risk fact; it is not a finding that the person is corrupt.
- Anti-Money Laundering and Counter-Terrorism Financing Act 2006: Section 5 PEP definitions; sections 28(2)(e) and 32(c)
- AML/CTF Rules 2025: Sections 5-5(1)(a) to (c) and 6-23
- Resolve identity
A possible name match is not a confirmed identity.
- Identify the type
Domestic, foreign or international organisation PEP.
- Identify the role
Check how the person is connected to the customer and service.
- Apply exact conditions
Enhanced CDD, source checks and approvals have distinct provisions.
- Record the decision
Keep the evidence and resulting action visible.
Resolve PEP status before choosing the response
Read each applicable provision. This diagram does not treat all PEP types or connected-person roles identically.
Decision checkpoints. Read the conditions for each point in the text below.
Separate the resulting duties
Section 28 includes establishing relevant PEP status. Section 32(c) requires enhanced CDD for the specified foreign PEP connections, including a person acting on the customer's behalf. Rules 6-23 addresses source of funds and wealth for specified persons: foreign PEPs, and domestic or international organisation PEPs where customer risk is high.
Rules 5-5 also requires senior manager approval before starting services in its specified PEP cases. The persons and conditions in these provisions are not identical. Check each duty directly. This page focuses on Australian delivery; Rules 6-23 contains a special foreign-establishment treatment that requires separate examination when relevant.
Worked example: a possible name match
A fictional screening search returns a name matching a public official. The reviewer compares appropriate identifying information before concluding that the customer is that person. A similar name is not the same as established PEP status, and a lack of an exact match is not proof that no connection exists.
If the match is confirmed, the reviewer identifies the PEP type and the person's role in the relationship. The response follows the relevant conditions. This example illustrates identity resolution. It does not recommend a particular screening supplier, set a universal matching threshold or determine a real person's status.
Make the decision traceable
A practical note separates the evidence for the match, the applicable PEP category, the customer risk assessment and the resulting action. Where approval is required, identify the approval rather than assuming an automated result supplies it. If a possible match is rejected, record the reason.
Avoid descriptions that imply all domestic or international organisation PEPs are automatically high risk. Equally, do not overlook a foreign PEP trigger because a general score is low. This distinction helps staff apply proportionate checks without ignoring mandatory duties or treating public service itself as evidence of wrongdoing.