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Investment Indicators - 24 July 2017
In This Week's Newsletter
Rates Review
Investment Rates
Money Market Funds
Top 3 Rates
 
From the Crow's Nest
Debarment and TCF – Does the practical application always lead to fair outcomes?
 
Your Practice Made Perfect
New findings contradict NHI White Paper – Socio-economic research by Econex refutes basic principle on financing of current model
Insurance Gateway Ezine – Click here to download the July summary of industry news
 
Regulatory Examinations
DOFA Do's and Don'ts
Important RE Considerations
Updated schedule
Self-Help Guidelines to make a booking, download your certificate or view results
 
Careers Platform
Are you hiring? Advertise your position on Moonstone’s Career Platform
Featured Positions
 
In Lighter Wyn
One-liners on relationships
Paul Kruger 2016-10-31
Paul Kruger Author/Editor
 
 
 
 

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One of the most important ways to manifest integrity is to be loyal to those who are not present. In doing so, we build the trust of those who are present – Stephen Covey
 
Please connect with us: www.moonstone.co.za pkruger@moonstoneinfo.com or 021 883 8000

 
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GTC banner 2017-06-22
GTC Medical Aid Survey 2017 reveals small medical aids also offer good value
Smaller medical schemes perform well by offering consumers value for money, but they have not been as successful as some of the larger schemes in attracting new members.

This is one of the significant conclusions from leading wealth and financial advisory firm GTC in its seventh annual Medical Aid Survey (MAS) for 2017.

The Medical Aid Survey analyses and rates medical aid schemes and provides a standardised comparison and ranking of the choices available to consumers.

This year’s survey reviewed 23 open medical aid providers, with a total of 144 plans, which were categorised into 11 areas according to benefits offered.

Click here to read the article, or download the
2017 MAS pdf.
Rates Review
Top 3 rates
 1. Secured Investment Rates
Please note that (G) indicates a Guaranteed and (L) a Linked product. In order to understand the difference between guaranteed and linked rates, kindly click here for an explanation.
 R 100 000
 
 
 
     
  Company This Week Last Week
1 1Life (L) 6.750% 6.900%
2 Absa (L) 6.385% 6.539%
3 Assupol (G) 6.290% 6.440%
     
 R 1 000 000
     
     
  Company This Week Last Week
1 1Life (L) 6.750% 6.900%
2 Assupol (G) 6.720% 6.870%
3 Absa (L) 6.385% 6.539%
     
 2. Money Market Funds
  Company This Week Last Week
1 Allan Gray 8.150% 8.050%
2 Prescient 8.130% 8.070%
3 Cadiz 8.020% 7.980%
Please bear in mind that our figures, though based on the actual quotations that you also use, are for information purposes only, and can never replace the official quotation from the product house. In terms of the guarantees, you are requested to clarify the exact extent of such guarantees with the product house prior to advising clients.
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From the Crow's Nest
From the Crow's Nest
Debarment and TCF
The necessity for a process to ensure that those who fall foul of the fit and proper requirements are not allowed to practice was never in question. In particular, the bad apples need to be discarded.

Unfortunately, the application and execution of the debarment process should possibly be regarded as one of the failures of the FAIS Act.

The Good

The prescribed process, if followed to the letter, will ensure the desired outcome, provided all parties conform to the requirements. The FAIS Act clearly stipulates that the FSP must, within 15 days after removal of the representative’s name from the register, inform the Registrar in writing, and provide the Registrar with the reasons for the debarment “…in such format as the Registrar may require”.

The “Debarment Notice” actually calls for documentation to be included as proof that the correct disciplinary procedure was followed, including the reasons for debarment and disciplinary hearing documentation.

Importantly, it also asks for documentary proof that the representative was informed, and acknowledgment of receipt of such notification.

In July 2015, we published an article titled Feedback on debarment of representatives, published in the FSB’s FAIS Newsletter 17. In this document, the head of the Enforcement Department set out his views on the process. In an earlier newsletter, he also expanded on his department’s frustration with FSPs who abdicated their responsibilities under Section 14(1) to his department.

The Bad

The most common manifestations of people completely disregarding these requirements are found in enquiries to us from representatives who were basically shown the door without any disciplinary process followed, or malicious debarments because the rep resigned and joined another FSP. In many of these cases, they were debarred after they left, and were oblivious of the debarment until their new employer informed them that their names appear on the “blacklist”.

Most complained that they were never subjected to disciplinary procedures, thus no documentation could have been sent to the Regulator.

Under the current system, they have no recourse to the Regulator, and are obliged to approach courts of law, which few can afford.

In the High Court case between Francois Gideon Pienaar and the Registrar in July 2013, the court had to determine whether the FSP had “lawful reason to request and secure a debarment”, and whether the FSB had acted lawfully in effecting the debarment. The court found for the applicant, Pienaar, and the Registrar was obliged to lift his debarment, and bear the costs of the application.

This raises the question of what the FSB does with the documentation that it requests as part of the debarment process. Does it actually insist on it being submitted by the applying FSP? Surely this must play an important role in both debarring a person, and when considering a request for the debarment to be lifted?
 
The Ugly

It is not only representatives who complain about non-adherence to guidelines published by the Registrar.

The rationale for regulation of the financial services industry is protection and fair treatment of clients. The same can be said for employees in the industry. Failure in this regard should receive urgent attention.

The guidelines for reappointing debarred reps contain the following statement:

It is the duty of the provider to ensure that their representatives are fit and proper. The Registrar does not assess the fitness and propriety of representatives. If the Registrar is of the view that a representative is not fit and proper, the Registrar must (my emphasis) take action against the provider for not complying with section 13 (2) of the Act.

This places an obligation on the “applying” FSP to ensure that all is kosher in terms the new appointee to avoid regulatory action against it.

It also obliges the FSB to consider documentation in its possession, including those relating to disciplinary hearings to ensure that the public is protected against people not fit to deal with clients. It cannot abdicate its responsibility to the public by shifting the onus onto the FSP.

Going forward

The shortcomings of the current system have been clearly grasped, and the entire section is to be replaced in the new legislation. Importantly, there will now be a tribunal, similar to the current Appeal Board, for disgruntled parties to state their case.

The point is: Can we wait that long? Or rather, should we have waited this long before addressing obvious shortcomings in the Act?

Over the years, many other anomalies in the Act received attention to ensure fair outcomes for clients. Why not this process?
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FPI banner 2017-07-06
 
Investments in South Africa: A look ahead
Be sure not to miss this high-level panel discussion, at the FPI Professionals Convention, on the future of investments, where experts will debate factors such as, using inflation benchmarks to identify sustainability of returns.

This panel discussion will be led by industry expert and renowned speaker Anton Swanepoel, CFP® (Amity Wealth) and the following esteemed panel members:

Find out more about the 2017 FPI Professionals Convention or contact erin@confco.co.za.
Your Practice Made Perfect
Your Practice
New findings contradict NHI White Paper
Recent research conducted by Econex, a leading firm in competition economics, paints a different picture to that portrayed in the NHI White Paper on healthcare in South Africa.

In a research note published this month, it challenges the claim that the current financing system punishes the poor.

A summary of the research, published as a blog post, positions its research:

“A central issue in driving universal cover under a National Health Insurance (NHI) system is the redistribution of resources to the poor, whose need for healthcare generally exceeds the resources allocated. This is an important issue, as it is recognised that healthcare resources need to be distributed in an equitable manner. However, the South African debate has been polarised on this issue with claims that the South Africa has a “financing system that punishes the poor” (stated in both the 2015 and 2017 versions of the NHI White Paper).”

“In order to contribute to the ongoing debate and in the light of renewed focus on the implementation of (NHI) in South Africa by 2025/2026, Econex has updated the research on the socioeconomic distribution of healthcare benefit and healthcare financing, This research has been commissioned by Mediclinic South Africa. In updating the research on this issue we have relied on household survey data, information from the Council for Medical Schemes, as well as estimates from National Treasury.”

“We find that financing incidence is in fact pro-poor in the sense that the wealthiest 40% of the population contributes the largest share. The poorest 60% of the population receives a higher proportion of benefits than what they pay for – a distribution that is in line with principles of equity and social solidarity. However, it must be noted that this poorer part of the population receives fewer benefits than those received by the wealthier 40% of the population. Importantly, the poor receive a smaller proportion of total healthcare benefits than what their share of healthcare need warrants. This is problematic.”

The more comprehensive (9 page) Econex research Note 45 can be downloaded here.
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Regulatory Examinations
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DOFA Do's and Don'ts
In response to many regular enquiries, we re-publish an article from last year.

Vetting the date of first appointment of applicants and appointees is an important part of compliance.

FAIS Newsletter 20, published on 19 May 2016, contains a number of pointers to make life easier for FSPs and the FSB. The article concludes with a handy summary:

Do:

  • Send all DOFA related enquiries to FAIS.Dofa@fsb.co.za and not any other inbox

  • Include the ID number and full names of the individual concerned in either the subject line or body of the e-mail (third party enquiries) together with a signed consent letter.

  • Include your full names and identity number (where you are requesting your own DOFA information)


Do not:
  • Submit a request for an individual’s DOFA record without attaching a signed consent letter

  • Send DOFA requests through to the administrative staff member’s personal inboxes

  • Submit the same DOFA request multiple times – this merely delays the process for others.


An important reminder to compliance officers and key individuals is that the DOFA report, which can be generated via the FAIS online reporting system, provides the DOFA date(s) for all key individuals and representatives of the FSP as well as their RE status..
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Important RE Considerations
  • We are experiencing an increase in the number of candidates attempting to complete the REs before the expected changes in legislation, which will have a direct impact on the current training and study material.

  • Candidates who failed to pass before the 30 June 2017 DOFA cut-off should also bear this in mind when planning to re- write.

  • Compliance officers are reminded of the 31 August 2017 deadline which is just around the corner. Please do not take it for granted that you will pass at the first attempt. Leave yourself enough time to re-write in the hopefully unlikely event that you fail at the first attempt.

  • The regulatory exams can also be written by those who are not compelled by law to do so. Many candidates write to enhance their chances of promotion or with a view to become representatives. There are no legal restrictions – anyone can write.

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2017 Schedule updated
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Self-Help Guidelines to make a booking, download your certificate or view results
Candidates who wrote with Moonstone can now view their results, make a new booking or update their information on our website: www.faisexam.co.za

Here is what you do:
  1. Click on the Moonstone FAIS Exam website (www.faisexam.co.za)

  2. Click on the second heading: “Update Your Booking/Personal Details/Get results”.

  3. Key in your ID or Passport Number used to register for the exam: click on Send password.

  4. The system will send a password to the e-mail address you provided at registration.

  5. Use this password to log in on the same address as above:
    Type in the password – do not copy and paste.

  6. Click login.

  7. You will then be able to make a booking, download your certificate or view results.

Frequently Asked RE Questions

Email enquiries should be addressed to faisexam@moonstoneinfo.co.za. You can phone us on 021 883 8000 - select option 2 to speak to one of our consultants.
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Careers Platform
Are you hiring? Advertise your position on Moonstone’s Career Platform
Careers Platform Packages

•   The Moonstone website - www.moonstone.co.za - enjoys an average of 15 000 visits and approximately 39 000 page views per month.
Moonstone boasts an exclusive newsletter mailing list of over 46000 dedicated financial decision makers who receive 2 newsletters per week.
Our audience is relevant and industry specific: individual and corporate advisors and brokers in the following financial sectors: iInvestment, Risk, Healthcare, Banking, Retirement, and Insurance.


Advertise


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Featured Positions
  • Wealth Management Consultant: Rockfin Wealth Management, Sandton - If you have the required insurance sales experience for this client facing, sales and targets driven profession, then Read More

  • Senior Client Liaison Officer: Vunani Fund Managers, Newlands, Cape Town - VFM is looking for a suitably qualified EE candidate with an accounting diploma or degree. Read More

  • Short Term Insurance Junior Underwriter: JFA Shortterm Brokers CC, Milnerton - We require a responsible person with NQF4 and RE5 for all relevant tasks related to client services in our short term insurance practice. Read More

  • Sales Consultant – Medical Scheme Brokerage: Optivest, Durbanville - The ideal candidate is RE 5 qualified, has medical scheme experience and is comfortable to interact by phone. Read More

  • Accounts Executive / Broker: Garrun, Houghton - We require a FAIS compliant and experienced Short-Term Insurance Broker with own transport. Read More

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In Lighter Wyn
In Lighter Wyn
One-liners on relationships
There are two theories to arguing with women. Neither one works.

I think, therefore I'm single.

Instead of getting married again, I'm going to find a woman I don't like and just give her a house - Lewis Grizzard

Relationships are hard. It's like a full time job, and we should treat it like one. If your boyfriend or girlfriend wants to leave you, they should give you two weeks' notice. There should be severance pay, and before they leave you, they should have to find you a temp - Bob Ettinger.

My Mom said she learned how to swim when someone took her out in the lake and threw her off the boat. I said, 'Mom, they weren't trying to teach you how to swim - Paula Poundstone.

Bigamy is having one wife or husband too many. Monogamy is the same - Oscar Wilde

Marriage is a great institution, but I'm not ready for an institution yet - Mae West

Once the trust goes out of a relationship, it’s really no fun lying to them anymore – Norm in Cheers.

A family vacation is when you go away with the people you need to get away from – Edward E Neuman, Mad magazine.

Love is the triumph of imagination over intelligence.

Marriage means commitment. Of course, so does insanity.

Marriage is one of the chief causes of divorce.

Always remember: one good turn gets most of the blankets. 
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