Money Laundering: UK Parliamentarians

Lord Flight Excerpts

Tuesday 14th October 2014 Lords Chamber

[Lord Deighton]

It is always difficult for me to comment on individual cases. I think that Members are making their points very clearly, with a variety of illustrations that I absolutely take on board. I will certainly follow up with the banks domestically through the Joint Money Laundering Steering Group, which provides the guidance. We are trying to strike a balance that makes it impossible for corrupt politicians, terrorists and criminals to go about their business but which leaves the rest of us unimpeded to go about our lives in a normal way.

[Lord Flight (Con)]

My Lords, the position of Members of this House and of the Commons is far worse than the Minister suspects. Some 150,000 people are rated as PEPs in this country, covering virtually all Members of this House and the House of Commons, including all spouses and all children. Wearing a hat as a banker I would add that, worst of all, banks are required to look at every transaction in the account of a PEP, both in and out, to satisfy themselves that they are proper transactions. The world of PEPs is by no means limited to just those who someone thinks are high risk. It covers virtually everybody and is completely out of control.

[Lord Deighton]

My noble friend is correct that the PEP definition includes close family members and business associates. I go back to the original point that it is not within the banks’ responsibility to look at every transaction of a domestic PEP; they should be assessing whether that PEP is high risk. If the PEP is not high risk, the banks should treat them like every other customer. That is where we need to focus our efforts to correct this problem.