Image
Icon

Directory

IconActuaries
IconAdministration Outsourcing
IconAsset Managers
IconAssociations & Institutes
IconAuditors
IconBanking
IconBBBEE Consulting and Verification Agencies
IconBusiness Chambers
IconBusiness Process Management
IconBusiness Process Outsourcing
IconCompliance
IconConsumer Protection
IconCorporate Governance
IconCredit Bureaus
IconCurrencies
IconDebit Order Collection Facilities
IconEducation and Training
IconFAIS
IconHuman Resources
IconInformation Technology and Software Partners
IconInvestment Consulting
IconInvestment Fund Managers
IconLegal
IconLISPs
IconListed Equities
IconOmbud
IconParticipation Bond Managers
IconPolicy Administration
IconPolicy Trading
IconProperty Unit Trusts (PUTS)
IconPublications
IconRegulatory Authorities
IconStock Exchange
IconSurveys and Research
IconTraining Courses & Workshops
IconUnit Trust Fund Managers
IconWellness Programs
Image
  Subscribe To »

Fais Compliance - Compassion not an alternative to Compliance

Published

2017

Wed

22

Mar

 

The latest ruling by the Appeal Board reaffirms the fact that there really is no alternative, harsh as it may sound.

The appellant appealed against the withdrawal of his licence by the Registrar. This decision was based on no less than ten instances of non-compliance with the provisions of the FAIS Act.

Some of the grounds on which it was withdrawn included:

  • Repeated failure to pay the prescribed levy and interest thereon;
  • Repeated failure to successfully complete the required first level regulatory examination;
  • Failure or inability to maintain suitable guarantee or professional indemnity or fidelity insurance cover (professional indemnity cover);
  • Failure to register with the FIC as accountable institution (FIC registration).

The Appeal Board states:

“The facts are not in dispute, also not that the appellant had been given repeated warnings and extensions to enable him to comply. The appeal is in essence a plea ad misericordiam — an appeal to compassion and pity while the function of this Appeal Board is to determine whether the Registrar was right or wrong.”

“The problem is that the appellant did not appear at the hearing. Although he had previously indicated that he would be represented and that two persons would attend the hearing he sent an email at about 15.00 on the day before the hearing stating that he had fallen ill and that he would send a doctor's note the next day.”

“When the appeal was called there was no appearance, no application for postponement and no doctor's note.”

“Although the Registrar wished to proceed with the appeal in the absence of the appellant we decided that the proper course to adopt is to strike the appeal from the roll because of non- appearance. If the appellant wishes to prosecute the matter he will first have to file a proper application for condonation and reinstatement of the appeal.”

From the use of the word “repeated” in the grounds for the withdrawal of the appellant’s authorization, it is quite apparent that the Registrar showed compassion for appellant’s problems. There has to come a time, though, when the line has to be drawn.

Sadly, this often happens to older folks who have no other means of making a living, which is one of the tragedies resulting from the need for stricter regulation of the industry from 2004 onwards.

It is doubtful whether the Appeal Board would have been able uphold the appeal on compassionate grounds. As indicated above: “…the function of this Appeal Board is to determine whether the Registrar was right or wrong.”

The appeal documents only list four of the ten grounds for the withdrawal of the authorisation. Whilst some, like the repeated failure to pay levies or pass the regulatory exams cannot be blamed on ignorance, matters such as failure to effect PI cover, or to register with the Financial Intelligence Centre may be the result of not knowing about the requirements. Ignorance is, unfortunately, not an acceptable excuse in law.

It also appears from the above that the appellant may well have made use of the facility offered by the Registrar to request for exemptions to pay levies or RE deadlines, but this can only be extended so far.

Nevertheless, and harsh as it may sound, the outcome is inevitable.

There is a lesson to be learnt from this. There is unfortunately no alternative but to comply with legal provisions if you want to stay in the business.

Click here to read the
Judgment on the FSB website.

 
Source: Paul Kruger: Moonstone Compliance (Pty) Ltd
 
« Back to previous page Print this page » |
 

Breaking News »

Developments at KPMG erode good governance: Minister

Finance Minister Malusi Gigaba says developments involving KPMG has undermined the reputation of good governance and audit independence in one of the key sectors and institutions in the South African economy. “These ...
Read More »

  

KPMG auditing practices a concern: Reserve Bank

The Reserve Bank on Thursday expressed concern at the “regrettable” auditing practices involving KPMG. “The South African Reserve Bank [SARB] has noted with concern the regrettable auditing practices ...
Read More »

  

De-risking and fiduciary duty

Sanlam’s Institutional Insights conference offers top global perspectives to guide fiduciaries   Johannesburg: In a landscape of continuous change and disruption, and in an investment environment ...
Read More »

  

Repo rate remains unchanged at 6.75%

The repo rate will remain unchanged at 6. 75% per annum, Reserve Bank Governor Lesetja Kganyago said on Thursday. “Given the heightened uncertainties in the economy, the Monetary Policy Committee (MPC) felt ...
Read More »

 

More News »

Image

Healthcare »

Image

Life »

Image

Retirement »

Image

Short-term »

Advertise Here
Image
Image
Image
Image
Advertise Here

From The Glossary »

Icon

Gross Domestic Product (GDP):

The sum of all goods and services produced by a country, expressed as an annual total. GDP growth indicates whether or not an economy is growing.
More Definitions »

 
 
By using this website you agree to the Terms of Use.
Copyright © Stoker Risk & ICT (Pty) Ltd 2004 - 2017.
All Rights Reserved.
Icon

Advertise

  Icon

eZine

  Icon

Contact IG

Icon

Media Pack

  Icon

RSS Feeds