A PEP, which stands for Politically Exposed Person, is an individual who holds an important role in the government or public sector. They play a significant role in the regulations of the financial sector. Banks are required to identify PEP customers because they have a higher risk of being involved in bribery and corruption due to their positions. This knowledge helps banks comply with anti-money laundering (AML) and counter-terrorist financing (CTF) regulations by implementing stricter due diligence measures.
However, despite the importance of PEPs, there is no universally accepted international definition of a PEP. The Financial Action Task Force on Money Laundering (FATF) defines them as people in high-ranking government positions or key political party members and their close relatives. In my dissertation, I study the behavior of Mozambican PEPs in the private sector over time. This introduces additional challenges: we need to define not only who is considered a PEP, but also when they start and end their political careers. The definition of the starting point is straightforward: it is the year of nomination or election to a mandate. I observe the announcement of such events based on data from news archives in Mozambique and Europe. Observing the end point of a mandate is more tricky. Politicians can resign or die at any time, and the name or definition of a political mandate might change over time. Given these constraints, I assume that a mandate ends if the person is no longer mentioned during the announcement of a new legislation. I divide the nineteen years between 1975, the year of independence, and 1994, the first year of the multiparty system in Mozambique, by one cut-off point: the death of then-president Samora Machel in 1986. To make things even more complicated, the independence movement FRELIMO announced their first ministers in 1969, six years before the independence of Mozambique.
To my knowledge, the only public database that covers PEP data over time is the Who Governs dataset by Jacob Nyrup and Stuart Bramwell, who parsed the annual CIA Yearbook to identify PEPs over time. To compare and validate this data, I compare the mandates of the Who Governs data with the ones I identified in the news archives. In the figure below:
