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Investment Indicators - 27 November 2017
In This Week's Newsletter
Rates Review
Investment Rates
Money Market Funds
Top 3 Rates
 
From the Crow's Nest
FAIS Ombud 2016/2017 Annual Report – We do some alternative number crunching
 
Your Practice Made Perfect
FSB RDR Update November 2017 – Interesting points for discussion at the Annual FSB Insurance update
FAIS Cat I and II licences – Some aspects for consideration at the FSB Insurance Conduct of Business seminar
 
Regulatory Examinations
Legislation Handbook and Preparation Guide for REs – New stock arrived. Order online
Schedules for 2017 and 2018
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
Mommy's boy and Black Friday Victims
Paul Kruger 2016-10-31
Paul Kruger Author/Editor
 
 
 
 

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– Nicholas Chamfort
 
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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) 7.550% 7.490%
2 Absa (L) 7.457% 7.398%
3 Discovery (G) 7.040% 6.640%
     
 R 1 000 000
     
     
  Company This Week Last Week
1 Discovery (G) 7.582% 7.190%
2 1Life (L) 7.550% 7.490%
3 Absa (L) 7.457% 7.398%
     
 2. Money Market Funds
  Company This Week Last Week
1 Prescient 8.020% 7.770%
2 Cadiz 7.780% 8.120%
3 Allan Gray 7.750% 7.730%
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
FAIS Ombud 2016/2017 Annual Report
How do the numbers contained in the Ombud’s latest report reflect on its mandate?

Complaints received for the period 1 April 2016 to 31 March 2017 came to 10 846, compared to 9 891 for the previous year.

• 3 794 (35%) complaints were dismissed.
• 4 639 (43%) complaints were referred to alternative forums.
• 592 (5.5%) were settled, a decrease from the 753 of the 2015/2016

The actual number of complaints handled by the Ombud came to 11 025. The graph below reflects how it was dealt with:

FAIS Ombud Resolutions

In other words, out of 11 025 complaints handled by the Ombud, only 1 073 (9.7%) were resolved in favour of the public. 47% were dismissed and 43% were referred elsewhere for resolution.

It is also interesting to note where those complaints that did not fall under the jurisdiction of the Ombud landed up.

FAIS Ombud Referrals

In respect of the above, the Ombud notes:

“Lest our efforts are misinterpreted as inadequate because of the increased number of dismissals and referrals to other fora, we should look at the process that underpinned the 3 794 dismissed complaints and the 4 639 referred elsewhere.”

“The 3 794 complaints were dismissed after applying the legal rigour that the circumstances of each case warranted. To minimise the chance of dismissing a complaint in error, decisions to dismiss must be approved by senior managers and must be accompanied by submission of extensive supporting documentation. Similarly, if complainants are not satisfied with the decision to dismiss their complaint, they have the right to lodge an informal appeal for a review by a more senior person, who is likely to be an Assistant Ombud or Team Resolution Manager.”

“Dismissals and referrals to other fora are never done out of hand. Very often, we receive a complaint of one or two paragraphs that does not permit us to make a decision. In order to arrive at a position where we can make a decision about the complaint, we have to probe. Right from the first day of receiving the complaint at the case management division, we build an activity journal. An activity journal records personal details of complainants, their financial circumstances at the time of advice, the questions used to probe, and information given about the financial product. Once the case manager has built the story, the next stage involves an elucidation of the issues followed by application of the law. Only after completion of all these stages is a decision taken.”

“With regard to the 4 639 complaints that were referred to other fora, the decision to refer follows strict legal scrutiny and the decision of the case manager is subject to confirmation by a senior person. Where a decision is made to refer the complainant to court as provided for in the Rules on Proceedings of the FAIS Ombud (Rules), that decision is not appealable.”

The Annual report notes the following on the Ombud’s mandate under the heading “Legislative Mandates”:

a) FAIS Act

The main objective of the FAIS Ombud is to investigate and resolve complaints in terms of the FAIS Act and the Rules promulgated thereunder.

b) FSOS Act

A further function of the FAIS Ombud is to resolve complaints in terms of the Financial Services Ombud Schemes Act, (Act No. 37 of 2004) (FSOS Act), which is not covered by any of the other voluntary Ombud schemes or where there is uncertainty over jurisdiction.

Whilst it is admirable that the office of the Ombud goes to such lengths to ensure fairness, one has to ask whether an office, funded by levies from the industry, should spend the majority of its time and resources on complaints that should be handled by other forums.

Surely a central complaints facility for the financial services industry to refer complaints to the right forum would lead to a substantial increase in the efficient handling of the 5 630 justiciable complaints received by the Ombud. This would also contribute to the Ombud’s stated intent of handling complaints in a “…procedurally fair, informal, economical and expeditious” manner.
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Your Practice Made Perfect
Your Practice
FSB RDR Update November 2017
At the end of last year’s Insurance update from the FSB, Jonathan Dixon said: “We had better fasten our safety belts – this is going to be rough year”, or words to that effect.

Having read all eleven presentations for this year’s road show this weekend, it might be advisable to strap on a parachute as well.

I found the points on RDR of particular interest, and will be reporting back after tomorrow’s session in Cape Town.

The following are just some of the thoughts for discussion:

Adviser categorization: A consultation paper is to be published soon to confirm the previously communicated two-tier model and requesting input on several interesting aspects, including:
  • The feasibility of allowing a product supplier agent (PSA) to act as the PSA of more than one product supplier in different, non-competing lines of business, and related controls.

  • Standards for allowing PSAs to refer customers to another product supplier in light of removal of “gap filling”

  • Whether “gap filling” should be permitted for fixed interest annuities. The current thinking is that this is not necessary as it can also be managed through referrals.

  • Conditions for being able to describe advice as being “independent” and

  • Product supplier responsibility for different forms of advice.

Non-advice sales execution
  • New FAIS fit & proper competency requirements define the activity of “execution of sales” and set competency requirements for scripted sales models

  • A change to the FAIS definition of “intermediary services” which will close the previous gap whereby direct sales execution by product suppliers potentially fell outside the scope of FAIS.

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FAIS Cat I and II licences
We are aware that there is fair amount of concern in the industry about where the regulator is heading in this regard. The following are some of the points for discussion at the FSB Insurance Conduct of Business seminar In Cape Town tomorrow:

Informal consultation is underway with the investment industry on:
  • Defining “investment management” as a specific licensed activity

  • The extent to which investment managers (as defined) should be licensed/regulated differently from “model portfolio providers” and other types of discretionary mandate holders

  • Clarifying the contractual and business relationships between all entities in the investment value chain to mitigate risks of conflicted advice and conflicted discretion

  • Third party outsourcing / “white label” models. We no longer propose to completely prohibit white labels being held by entities providing advice, provided conflict risks can be adequately mitigated

  • The implications of the two-tier adviser categorisation in the investments space. In particular: When should an investment adviser be classified as a product supplier agent (i.e. is there a role for “tied” advice in the investments sector?)

  • The extent to which intervention in remuneration arrangements, over and above the prohibition of product supplier commissions, is appropriate to address risks.

  • A public discussion document on these investment related proposals will follow in early 2018.

We will report back on this next week. There will be transitional arrangements, so please do not jump the gun until you are sure which way the wind blows.
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Regulatory Examinations
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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 – Answers to questions on REs and preparation material

DOFA - Do's and Don'ts

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
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Careers Platform Packages

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Featured Positions
  • Short Term Claims Administrator: The Insurance Center, Westville, Durban - The successful applicant must be experienced, work unsupervised and be competent to negotiate claims settlements at the highest level. Read More

  • Financial Sales Consultant: Quest Staffing Solutions, Cape Town - You will provide qualified financial advice directly to clients and therefore a minimum of 6 months Outbound Call Centre sales experiences or 12 months face to face financial sales, with a RE qualification will be required. Read More

  • Group Compliance Practitioner: LegalWise, Gauteng - You will play a key role in assisting the Group Compliance Manager to enhance and maintain the compliance strategies and processes, as well as a culture of ethics and compliance, across the Group. Read More

  • Junior Short Term Underwriter: JFA Short term Brokers, Milnerton, Cape Town - Are you bilingual, computer literate, with NQF 4 and RE5 certificates? Read More

  • Insurance Sales Counsellor: Brip Africa, Cape Town - If you are FAIS compliant, experienced in Outbound Call Centre sales, or have at least 2 years’ face to face sales experience, then Read More

  • Hiring Financial Advisor: Anton Koch Financial Planning, Berea, Durban - Suitable candidates must have a Certified Financial Planning Diploma or working towards a CFP and completed the RE5 exam with at least 6 months working experience. Read More

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In Lighter Wyn
In Lighter Wyn
Mommy's boy and Black Friday Victims

Mommy's boy

Dankie Danny Jacobs

Mommy's Boy


Black Friday Victims

Black Friday 01


Black Friday 02


Black Friday 03
 

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