The joys of being a 'politically exposed person'

I have been having what can only be described as a feisty exchange with a UK financial institution in recent weeks, caused by a piece of legislation that I was only dimly aware of, the Money Laundering Regulations 2007.

You may be surprised to hear that I am not actually engaged in money laundering - trust me, I wouldn't be travelling standard class on the train if I was - but in this era of international financial transfers, financial institutions are obliged to be far more careful than they might have been previously. This may have something to do with the increasing tendency to make organisations and individuals financially, and sometimes criminally, responsible for policing the acts of members of society, but it inevitably makes life more difficult for the inherently honest, i.e. most of us, by imposing a series of barriers to be surmounted before doing something that would otherwise be quite straightforward.

Some years ago, I invested a modest amount in said institution, and the funds have sat there ever since. I probably provided them with some evidence at the time, but they now wanted to see further proof of identity, as well as evidence as to where the funds came from. Easier said than done, as I hadn't retained the relevant documents - they're older than tax law requires me to retain, but they insisted.

I did indicate that I was curious as to why they should, after all this time, require such documentation, and I was told that it was a requirement of UK legislation, possibly their first mistake - I am a bureaucrat, and am 'rule-curious'. In reply, they indicated that they were sorry, but failed to provide details of the legislation, except to note that I am, apparently, a 'politically exposed person', although they didn't explain why.

I did guess, however, and did some research, uncovering the Money Laundering Regulations 2007, which indeed describe the criteria for such a classification. There was, however, a catch - whilst those holding high political office, as well as their direct family, are covered, there is an exception for domestic politicians.

So, in a spirit of inquiry, I asked if they were relying on the relevant Appendix, and whether they were aware of the exception, to which the answer came, "Yes, and yes, but it doesn't matter, we're within our rights to apply rules that go beyond the legislation stated.". I wasn't impressed. Whilst I acknowledge the right of the bank to apply their own criteria, I do object to being deliberately misled by a bank official as to the nature of those criteria and the manner in which they are applied.

But I am rather better informed as to the potential complications of my financial arrangements and of the need to retain paperwork in future. More filing...