There can be few who have not heard of FICA, the Financial Intelligence Centre Act, No. 38 of 2001. The Act established a regulatory anti money laundering system for South Africa. FICA has had major implications for the “accountable institutions” such as:
- Estate agencies
- Unit trust and Insurance companies
- Accountants and
- Gambling institutions.
FICA is not to be taken lightly. The requirements of the Act are demanding and the penalties upon conviction of an offence are severe. It is important that not only “accountable institutions”, but also their employees, understand and fulfil their responsibilities and obligations in terms of the Act. All employees have a legal obligation in terms of FICA and can be held personally liable for failure to apply and follow anti-money laundering procedures.
The publication is aligned to Unit Standard 242593– Explain South African money laundering legislation and the implications for accountable institutions in transacting with clients. NQF level 4; 3 credits.
- Module Outline
- Who is this for
South African Money Laundering Legislation
- Money Laundering Concepts: Background; Organised crime; Stages in the money laundering process
- South African Money Laundering Legislation: The Prevention of Organised Crime Act (POCA); The Financial Intelligence Centre Act (FICA); The Protection of Constitutional Democracy Against Terrorist and Related Activities Act (POCDATARA); The Money Laundering and Terrorist Financing Control Regulations
- Role players in the money laundering control regime: The Financial Intelligence Centre (FIC); Accountable institutions; The Counter-Money Laundering Advisory Council; The Financial Action Task Force (FATF); The Eastern and Southern African Anti-Money Laundering Group (ESAAMLG); The Egmont Group; The Financial Services Board (FSB); The South African Revenue Service (SARS); Reporting institutions
- The Section 43 Compliance Office and the Money Laundering Reporting Officer
- Identification and verification: Know your client; Establishing identity; When should identity be established; Source of the funds.
- Categories of client: Natural persons; Legal persons; Agents, Trusts and Intermediaries.
- Exemptions from the requirements: More than one accountable institution; An accountable institution in another country; Stock exchange listed companies; Insurance and investment providers’; exemptions; Exempt products; Exemptions with regard to retirement funds; Members of exchanges’; exemptions; Attorneys’; exemptions; Property administrators’; exemptions; Estate agents&’; exemptions; Gambling institutions’; exemptions; Banks’; exemptions; Exempt products or transactions
Internal Rules, Record-Keeping, Cash Transaction Reporting, Suspicious or Unusual
Transactions and Reporting
- Internal rules and reporting requirements: Guidelines for establishing and verifying identity; Guidelines for keeping records; Guidelines for reporting information.
- Awareness and Training.
- Record Keeping: Objectives of record keeping; Account and transaction information to be recorded; Client records to be maintained; Period of retention of client records; How and where client records should be retained.
- Cash Transactions: Reporting obligations; Reportable transactions
- Suspicious or unusual transactions: Reporting obligations; Suspicious or unusual transactions; Knowledge of suspicious or unusual transactions; Identifying suspicious or unusual transactions; Reportable events or transactions; Tipping off; Fulfilling your legal obligation; Documenting suspicion reports.
Workers in any industry where there is a responsibility to verify the source of funds under money
laundering legislation. It will be useful for employees of accountable institutions required to do client
identification such as those employed by accountants, attorneys, banks, gambling, investment and
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