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Moonstone Monitor - 13 July 2017 |
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Paul Kruger
Author/Editor |
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The reason why worry kills more people than work is that more people worry
than work – Robert Frost |
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Distributed to 46 567 subscribers.
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From the Crow's Nest |
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Key Individual cannot delegate accountability |
In a recent Appeal Board case, the FSP appealed against the FSB’s
decision to debar her for five years.
One of the grounds she raised was that her secretary failed to inform her of a
notification from the FSB informing her of the Registrar’s intent to suspend her
licence as she failed to submit a compliance report, and also did not pass the
required RE 1.
What is required when a KI is unable to attend to his or her functions?
“In this instance, the appellant and the office manager, who is her daughter,
were absent from office due to injury to herself and illness of her daughter,
during the period the FSB sent the letter, advising her about the suspension.”
In terms of paragraph 1 of part (VIII) of the Determination of Fit and Proper
Requirements, a FSP must be able to maintain the operational ability to fulfill
the responsibilities imposed by the Act on authorised financial service
providers and, must ensure that internal control structures, procedures and
controls are in place.
This means that the appellant had to maintain access to business communications
not only during her "emotional turmoil in March and April 2015" but
before and thereafter.
She had to make arrangements that the FSP could function properly in her
absence. It is apparent from the appellant’s version that she abdicated all
oversight duties to her secretary instead of appointing a new key individual to
take over that oversight functions at the FSP during her absence.
The delegation of her responsibilities to her secretary did not absolve her from
her duties. She remained the appointed key individual of the FSP at all relevant
times. There is no provision in the FAIS Act that allows a key Individual to
abdicate his/her responsibilities to another person. "Key individual" is
defined in the FAIS Act as a natural person responsible for the managing or
overseeing of activities of the appellant.
“Most importantly, Section 17(3) of the FAIS Act makes it clear that the
responsibility to establish and maintain procedures to be followed in order to
ensure compliance with the Act remains that of the FSP, through the appellant as
its key individual.”
In the Appeal Board matter between Coetzee and the Registrar of July 2016, the
Appeal Board stated: Needless to say, trust is indeed not restored in a
non-compliant FSP who places the responsibility on others to keep close watch
over her/him, ensuring that they remain compliant. That would amount to shifting
the responsibility for one's own actions on others and in this case, it does not
inspire confidence that Mr Coetzee can by himself earn the trust for purposes of
reinstatement. There is a clear emphasis that FAIS Act requires a key
individual to be positioned internally within the FSP to oversee the activities
of the FSP.
“In a recent decision of the Appeal Board between WD Jonker vs
The Registrar of Financial Services of November 2016, the Appeal Board stated
the following in respect of key individuals: A key individual therefore plays
a critical oversight role which must be performed with utmost good faith. That
it shall and must protect its clients’ interests, serving with due care, skill
and diligence is imperative. He/she is responsible for managing and/or
exercising oversight over all activities of the FSP and the people who serve as
representatives of the particular licensee. The key individual therefore has a
legal duty to ensure that financial services are performed with standards of
conduct similar to those of a trustee in relation to the interests of a trust.
Although the Jonker matter dealt with the key individual’s lack of oversight
over a representative who committed dishonest acts, the remark is equally
relevant to this matter as the appellant delegated the responsibility to her
secretary. She still had to account for the actions (omissions) of the FSP. Even
if the appellant’s version is accepted that her secretary did not inform her
about FSP’s suspension, she still had a duty to see to it that the FSP was
compliant with the FAIS Act at all times.
“We conclude that the appellant’s time of emotional turmoil in
March/April 2015 did not incapacitate her to such an extent that, for a period
of more than a year, she could not raise a simple enquiry with the office of the
Registrar as to the FSP’s status during her time of turmoil. It remained her
responsibility to appoint a key individual or at the very least the FSP had to
cease to conduct any new business after the 27th of March 2015.”
“The appellant's attempt to blame her secretary and attribute her delegation of duties
to her, having suffered emotional turmoil, is a further unsuccessful attempt to
avoid taking responsibility for her actions and omissions.”
Product Provider also guilty of contravention?
It appears that a substantial amount of business was written by the appellant in
the year in which she operated whilst her licence was suspended. This is
difficult to understand, given that a product provider is not allowed to accept
business from an unauthorized person.
The FSB regularly publishes details of suspensions and withdrawals. Product
providers who fail to ensure that they only deal with authorized FSPs are, in
fact, also transgressing the law. |
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Are you experienced in providing technical support for EB
consultants? |
If you are, then there is an opportunity for you to join GTC’s leading
EB Consulting team. This role includes providing technical support for
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letters and presentations, etc.
If you are interested in this exciting role, request the full job spec
or submit your CV to
recruitment@gtc.co.za. If shortlisted, you will be contacted for an
interview. Should you not receive a response within 30 days, please
consider your application unsuccessful.
www.gtc.co.za. |
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Your Practice Made Perfect |
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Old wine in new casks |
It is difficult to believe that in this modern world, with all the
technology at its disposal, financial product providers sometimes revert
to antiquated financial principles in designing new products.
The latest development is the establishment of an interest-free
participatory insurance system – also known as ‘Takaful’ – which is a
system of insurance based on Islamic principles of mutual assistance and
donation.
It also sees policyholders, rather than shareholders, benefitting from
profits, almost like an antiquated version of today’s cash bonuses.
This may very well contribute to financial inclusion which is such an
important consideration in the design of the preferred financial
services industry of the future.
Click here to read Florence de Vries’s interesting article.
You can also download a
PDF copy to share with your clients. |
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Incapacitation and will signatures
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We recently read about the controversy around the will of the late great
Joost van der Westhuizen. There was a dispute about the validity of one
of the wills as a result of the fact that he was unable to sign it
himself due to being incapacitated as a result of his illness.
This article, recently published by Miller Attorneys, provides some
guidelines for you and your clients should such a situation arise.
“Should you be unable to sign your will due to a physical impairment,
the South African Law stipulates that you may ask someone to sign the
will on your behalf or you can sign the will by the making of a mark. A
mark could be a thumbprint or perhaps the making of a cross.”
“Should someone sign on your behalf or you sign by making of a mark, the
requirements for a valid will are as follows:”
Please
click here to read the rest of the article.
You can also download a
PDF copy to share with your clients. |
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Regulatory Examinations
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Legislation Handbook and
Preparation Guide for REs |
The Legislation Handbook for Level 1 Regulatory Exams provides the
legislation specified as relevant to the regulatory exams RE 1 and 5.
The Preparation guide includes the qualifying criteria provided by the
FSB for these exams.
The qualifying criteria are cross-referenced in the Preparation Guide to
the relevant sections to be studied in the Legislation Handbook.
Shaded tabs enable the user to easily identify the four sections of the
work and the information is then grouped by subject matter area in order
to assist you to find the relevant items quickly and easily.
The 4th edition reflects the law as at 15 April 2015.
Click here to order these
LexisNexis
books from our Advisor Store.
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RE Self-Help Guidelines and Frequently Asked Questions |
Self-Help Guidelines
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:
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Click on the Moonstone FAIS Exam website (www.faisexam.co.za)
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Click on the second heading: “Update Your Booking/Personal
Details/Get results”.
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Key in your ID or Passport Number used to register for the
exam: click on Send password.
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The system will
send a password to the e-mail address you provided at
registration.
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Use this password to log in on the same address as above:
Type in the password – do not copy and paste.
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Click login.
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You will then be able to make a booking, download your
certificate or view results.
Frequently Asked RE QuestionsEmail 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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Are you hiring? Advertise your position on Moonstone’s Career Platform
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The Moonstone website -
www.moonstone.co.za
- enjoys an average of 15 000 visits and approximately 39 000 page views per month. |
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Moonstone boasts an exclusive newsletter mailing list of over 46000
dedicated financial decision makers who receive 2 newsletters per week. |
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Our audience is relevant and industry specific: individual and corporate advisors and brokers in the following financial sectors:
Investment, Risk, Healthcare, Banking, Retirement, and Insurance. |
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Featured Positions |
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Senior Client Liaison Officer:
Vunani Fund Managers, Newlands, Cape Town - VFM is looking for a
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Short Term Insurance
Junior Underwriter:
JFA Shortterm Brokers CC, Milnerton -
We require a responsible
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Life Insurance
Compliance Officer:
Bidvest Life Insurance, Umhlanga - If you have a minimum of 3 years
experience in the life insurance industry and Compliance Officer
experience, then
Read More
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In Lighter Wyn |
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So why did we work all our lives? |
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Guess what this is?
It's a new Prison in UK !
Prison vs Work
Just in case you ever get these two environments mixed up, this
should make things a little bit clearer.
@ PRISON
You spend the majority of your time in a 10X10 cell
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@ WORK
You spend the majority of your time in an 6X6 cubicle
/office
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@ PRISON
You get three meals a day fully paid for
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@ WORK
You get a break for one meal and you have to pay for it |
@ PRISON
You get time off for good behaviour
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@ WORK
You get more work for good behaviour |
@ PRISON
The guard locks and unlocks all the doors for you |
@ WORK
You must often carry a security card and open all the doors
for yourself
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@ PRISON
You can watch TV and play games
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@ WORK
You could get fired for watching TV and playing games |
@ PRISON
You get your own toilet
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@ WORK
You have to share the toilet with some people who pee on the
seat
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@ PRISON
They allow your family and friends to visit
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@ WORK
You aren't even supposed to speak to your family |
@ PRISON
All expenses are paid by the taxpayers with no work required
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@ WORK
You get to pay all your expenses to go to work, and they
deduct taxes from your salary to pay for prisoners
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@ PRISON
You spend most of your life inside bars wanting to get out
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@ WORK
You spend most of your time wanting to get out and go inside
bars
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@ PRISON
You must deal with sadistic wardens |
@ WORK
They are called managers
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Tel: +27 21 883 8000 | Fax: +27 21 883 8005
info@moonstoneinfo.com
www.moonstone.co.za
P.O. Box 12662, Die Boord, Stellenbosch, 7613, Republic of South Africa
Disclaimer:
Services and products advertised by external product suppliers in
this newsletter are paid for by the respective suppliers. Moonstone
does not endorse any opinions, conclusions, data, products, services
or other information contained in this e-mail which is unrelated to
the official business of Moonstone and furthermore accepts no
liability in respect of the unauthorised use of its e-mail facility
or the sending of e-mail communications for other than strictly
business purposes.
The complete disclaimer can be accessed
here.
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