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Moonstone Monitor - 8 March 2018 |
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Paul Kruger
Author/Editor |
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I am not afraid of death; I just don’t want to be there when it happens
– Woody Allen |
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Distributed to 51,365 subscribers.
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From the Crow's Nest |
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Record Keeping Relief? |
Some product providers have created facilities for advisers to upload
documents on-line. This is then stored in a secure environment by the provider.
John, a Moonstone Protector client recently raised an interesting compliance
question in this regard.
I have started uploading document directly to XYZ. In the past I used to send
the documents via email and then store the email.
This new process is faster and saves me having to store all these documents,
which is a huge relief for a one person business.
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Can I outsource the keeping of records to XYZ for the required 5 years? |
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If permitted, must I disclose this in next year’s conduct of business report? |
Our willing and able compliance consultant responded:
The new Fit & Proper requirements provide the following with regards to
recordkeeping:
A FSP must at all times have:
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adequate storage and filing systems for the safe-keeping of records, business
communications and correspondence; |
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systems and procedures that are adequate to safeguard the security, integrity
and confidentiality of information, including:
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electronic data security and internal and external cybersecurity; |
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physical security of assets and records; |
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system application testing; |
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back-up and disaster recovery plans and procedures for systems and electronic
data |
You may however outsource this function to a third party, provided the following
requirements are met:
A FSP, where it outsources a function or activity must -
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ensure that the person to whom the function or activity has been outsourced -
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has the ability, capacity, and any authorisation required by law to perform
the outsourced functions, services or activities reliably and professionally; |
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is able to carry out the outsourced services effectively, to which end the FSP
must establish methods for assessing the standard of performance of that person; |
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have a written contract that governs the outsource arrangement and which
clearly provides for all material aspects of the outsourcing arrangement,
including:
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addressing the rights, responsibilities, and service-level requirements of all parties; |
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providing for access by the FSP and the Registrar to the person's business and
information in respect of the outsourced function or activity; |
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addressing sub-outsourcing; and |
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addressing confidentiality, privacy and the security of information of the FSP
and clients of the FSP |
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properly supervise the carrying out of the outsourced functions, and
adequately manage the risks associated with the outsourcing, including any risks
to the FSP's clients; |
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take appropriate action if it appears that the person may not be carrying out
the functions effectively and in compliance with applicable laws and regulatory
requirements; |
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retain the necessary expertise to supervise the outsourced functions
effectively and manage the risks associated with the outsourcing; |
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be able to terminate the arrangement for outsourcing where necessary without
detriment to the continuity and quality of its provision of financial services
to clients; |
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establish, implement and maintain a contingency plan for disaster recovery and
periodic testing of backup facilities; |
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have effective access to data related to the outsourced activities, including
any data relating to the FSP's clients, as well as to the business premises of
the person; and ensure that the outsourcing arrangement does not |
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compromise the fair treatment of or continuous and satisfactory service to the
FSP's clients; or |
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result in key decision making responsibilities being removed from the FSP. |
In other words, you may “outsource” this function to XYZ, but I doubt whether
they will enter into a Service Level Agreement that provides specifically for
record-keeping.
A further question that comes to mind is whether you will have access to those
records should your contract with the provider be terminated?
I would therefore advise you to continue keeping your own records and to regard
the XYZ facility as an additional back-up system.
John responded:
Thank you for your comprehensive response. I will maintain the records in
question to comply with the specific wording of the regulations. In reality,
however, it is an unnecessary task as they are all on the XYZ main frame which
is far more secure than any I could create and is always accessible by me or the
client. |
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clients?
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An authorised Financial Services Provider FSP no. 731 |
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Your Practice Made Perfect |
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New Debt Counselling Fees |
The National Credit Regulator recently published a circular and
guideline in respect of the new fees that debt counsellors may charge
consumers during the debt review process.
The new fees are effective from 1 April 2018 and do not apply
retrospectively.
The NCR also advised that compliance with the fee structure will be
monitored.
Please
click here to download a copy of the circular on the new debt
counsellor fees.
Please
click here to download a copy of the debt counselling fee guidelines
2018.
Moonstone employed an NCA Specialist to render NCA compliance
services to its clients and prospective clients. Should you have any
queries, please contact Gerrit Viviers on 021 883 8000 or by email to
gviviers@moonstonecompliance.co.za. |
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Proposed Amendments to Policyholder Protection Rules
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The FSB published proposed amendments to the Policyholder Protection
Rules (“PPRs”) made under the Long-term Insurance Act, 1998 and the
Short-term Insurance, 1998, respectively, for public comment. The
proposed amendments form part of Tranche 2.
The proposed amendments to the PPRs are necessary to
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align the PPRs with the Insurance Act, 2017 (Act No.18 of 2017)
(“Insurance Act”);
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provide for certain conduct of business related requirements that will
be repealed from the LTIA and the STIA through Schedule 1 to the
Insurance Act, once the latter Act commences, as these conduct
requirements are better placed in subordinate legislation; and
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provide for microinsurance product standards by giving effect to the
National Treasury’s Microinsurance Policy Document released in
July 2011.
Comments are due by 13 April 2018.
It is expected that the proposed amendments to the PPRs will come into
operation on 1 July 2018 to coincide with the expected commencement date
of the Insurance Act and Prudential Standards to be made under that Act.
All the documentation is available on the
Treasury website. |
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SA drivers love their cars
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A national client survey by Santam revealed interesting and surprising
attitudes of drivers towards their vehicles, including emotional
attachment and feelings of despondency if dispossessed of their
much-loved cars.
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64% “very or extremely attached’” to their vehicle
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4 in 10 have named their ‘wheels’
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37% “unable to function” without their car
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However, 45% do not know the current monetary value of their vehicle
The survey further showed that when asked whether they knew the current
monetary value of their vehicle, nearly half (45%) did not know this
amount, even though the majority (58%) of the participants had read
their insurance policy in the last six months. An impressive 81% of
respondents were aware of what their insurance covers.
However, when it came to the settlement car owners would be willing to
receive if their vehicle was stolen, nearly half (48%) expected the full
amount for which the vehicle was insured. Other settlement amounts that
drivers would be willing to receive were “the market value the car was
insured for (29%) and “a similar ‘replacement vehicle’” (23%).
Click here to download the full
Santam media release on the survey. |
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Technologically Speaking
Moonstone Information Refinery
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Technology eases Compliance Burden
by Janine Geldenhuys |
Schalk Malan, CEO of BrightRock, recently
shared five of the major developments that are set to change the
insurance industry as we know it. According to Schalk the rise of
blockchain, personalised/precision medicine, the continuing rise of
big data, multi-channel engagement and the Internet of Things (IoT)
are technological advances that the industry will have to embrace in
order to reduce costs, and provide tailor-made solutions.
This is in line with technology trends that are shaping the
financial industry globally.
Forrester,
one of the most influential research firms in the world pointed out
that the old way of doing business will put companies at risk and
that digital transformation and the power of technology need to be
embraced.
But how does an adviser still stay compliant in such a techno world
or does technology actually assist and ensure that compliance
obligations are met and risk mitigated?
According to Neil Summers, Sales Manager at Moonstone, fintech
solutions such as SuiteBox does not only provide advisers with
viable and flexible alternatives to the more traditional ways of
working - technology also drives greater compliance efficiency in
the financial services environment.
“SuiteBox enables advisers to hold online video meetings with
clients and has the ability to review and sign-off on documents with
a legally recognised digital signature. It saves all interactions
and therefore provides you with a secure record of interactions to
provide an audit trail for regulatory compliance,” says Summers.
““It therefore not only assists the adviser to place the client in
the best position to make an informed decision, but also serves as
evidence in the event of complaints or disputes,“ he concludes.
Talk to us about Suitebox today and get connected!
SuiteBox is a secure web based digital interaction service that
transforms customer engagement for professionals with intuitive
video, document collaboration, screen sharing, selective recording
and real-time digital signing. This functionality helps
organisations accelerate and close business using the full power of
mobile and desktop devices. The Suitebox service can be fully white
labelled and seamlessly integrated with numerous CRM platforms. It’s
available via monthly subscription, is delivered via the cloud and
requires no technical expertise to use. For more information go to
www.suitebox.com.
Janine Geldenhuys is a communication officer at Moonstone
Information Refinery.
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Regulatory Examinations
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2018 RE Schedules updated |
Please note: Registration cut-off is 11 working days before date of exam. |
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FSB Regulatory Exam Update |
Final closing date for March
Please note that you only have until Tuesday, 13 March, to register should you
wish to write on 29 March. As most venues are either fully booked, or nearly so,
please book at your earliest convenience. After the 29th, amended questions as a
result of the new Fit and Proper regulations will be included in the question
databank. See article below on this.
FSB Fee Increase from 10 March
The increased fee of R1 226 per regulatory exam was published in the Government
Gazette on 9 February and becomes effective, technically, on 10 March. This will
apply to all future bookings, for exams as well as rewrites, from Monday, 11 March 2018.
Regulatory Exam Changes
The amended requirements contained in the 2017 Determination of
Fit and Proper Requirements will have a substantial impact on
the content of the study material for the REs.
The FSB’s
FAIS Information Circular 1/2018 confirms a number of
matters we discussed since the publication of the new Fit and
Proper Determination, which comes into effect from 1 April 2018.
Certain questions in the RE 1 (key individuals) and RE 5
(representatives) will change to align with the new regulations.
Current Version of RE 1 and RE 5
Persons already registered to write the regulatory examination
BEFORE or on 29 March 2018, will still write the current version
of the regulatory examination (without the updated questions
included).
The last date for registration to write on 29 March 2018 is
close of business on 13 March 2018.
Updated Version of the RE 1 and RE 5
Persons who registered to write the regulatory examination ON or
AFTER Tuesday, 3 April 2018 are obliged to write the new
version of the regulatory examination, which will contain the
updated questions. It is very important for these candidates to
ensure that they use updated preparation material that is
aligned with the qualifying criteria in Annexure Four of Board
Notice 194 of 2018.
Study Material
The updated FSB Preparation Guide for RE 1 and RE 5, together with
the relevant legislation, and the relevant Training Manuals from BANKSETA/INSETA
may not be available at the time that the
updated RE 1 and RE 5 roll out on 3 April 2018 in which case
candidates will have to incorporate BN 194 of 2017 in their
study material. |
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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 20 000 visits and approximately 39 000 page views per month. |
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Moonstone boasts an exclusive newsletter mailing list of over 51000
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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In Lighter Wyn |
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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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