Compliance with Legislation
FAIS legislation information as well as other compliance requirements and information is available on the FSB website.
FAIS | Financial Advisory and Intermediary Services Act, 2002:
"To regulate the rendering of certain financial advisory and intermediary services to clients; to repeal or amend certain laws; and to provide for matters incidental thereto."
FAIS, is legislation that impacts on the financial services industry and aims to regulate the giving of advice and rendering of intermediary services to clients, as well as certain other issues. FAIS impacts on most financial institutions, financial service providers their representatives (such as advisers, direct sellers) and other staff.
The objectives of FAIS are to:
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Protect the clients who use financial services and products |
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Protect the financial services industry |
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Protect intermediaries |
FAIS requires a financial service provider to:
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Determine the financial needs of the clients |
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Provide appropriate advice to clients after having established the relevant facts |
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Assist clients to make informed decisions |
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Establish an effective complaints resolution procedure |
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Ensure that intermediaries are competent |
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Ensure that product providers and financial planners act with due care and diligence, and in the interests of the client. |
FAIS requires that the Bond Choice representatives:
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Provides clients with trusted and appropriate advice and solutions |
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Act with integrity, transparency and a culture of discipline when dealing with clients |
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Bond Choice's representatives are obliged to document advice-related communications concerning financial services rendered to clients. This will impact on the amount of paperwork required, but ultimately FAIS protects us all. |
Clients will benefit from the new legislation by:
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Receiving protection by means of appropriate and trusted advice, integrity and transparency |
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Maintenance of high standards by product providers |
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An effective complaints resolution mechanism |
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Protection through the continued existence of the FSP |
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Proper monitoring of advisers' and consultants' actions |
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Record keeping of advice and communication |
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Ensuring that advisers are competen |
FAIS was effective from 30 September 2004. It is important to note that this date is the same for all financial institutions impacted by FAIS and that, from this date onwards, no FSP may operate without a FSP licence.
FICA | Financial Intelligence Centre Act, 2001:
"To establish a Financial Intelligence Centre and a Money Laundering Advisory Council in order to combat money laundering activities; to impose certain duties on institutions and other persons who might be used for money laundering purposes; to amend the Prevention of Organised Crime Act, 1998, and the Promotion of Access to Information Act, 2000; and to provide for matters connected therewith."
The act has been implemented and applies to any known or suspected money laundering activity or related breach of duty, involving not only employees, contractors, temporary employees, consultants, clients but also shareholders, vendors, outside agencies, and unknown parties.
This policy addresses the responsibility of management and employees for:
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Preventing, detecting, monitoring and reporting confirmed, suspected, detected or prevented money laundering; |
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Client identification and verification ("know your client"); |
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Record keeping; |
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Money laundering control training; |
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Monitoring of accounts, activities, policies, procedures and plans |
In terms of FICA, all accountable institutions have specific duties to help prevent money laundering. One of these duties is to "Know Your Client".
Useful Links
Click here for useful links that can assist you to obtain more information on the compliance and information acts as discussed above.
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