Risk management and compliance programme Accountable institutions are now obliged to develop, document, implement and maintain a risk management and compliance programme RMCP. The RMCP is an all-encompassing document which sets out how accountable institutions must comply with its obligations in terms of the Act.
The Act provides that business relationships with PPOs are automatically deemed high risk, whereas business relationships with PIPs are not automatically deemed high risk.
As such, it is not a requirement that a business relationship with a PIP undergo stringent CDD when it is conducted unless red flags are discovered during a standard CDD process. If such a situation arises, these stringent measures will come into effect post-fact. Transactional monitoring To ensure that client information is accurate and that actions taken throughout the business relationship are consistent with the information provided by the customer, transactional monitoring requires accountable institutions to sufficiently understand every transaction taken throughout that relationship.
The concept of ongoing due monitoring has also met expression within the Act. Record-keeping Accountable institutions have a duty to keep CDD records, including documentation relating to transactions, for five years from the date on which the business relationship was terminated. Non-compliance with the FATC signals to the global financial and banking system that there are heightened risks associated with transactions in a specific country.
If a country is blacklisted under FATF — such as North Korea, Iran, and Cuba — companies may not receive or send money to or from blacklisted countries. This may result in adverse consequences such as sizeable fines or the spectre of imprisonment for those working within accountable institutions.
If an accountable institution is found to be guilty of an offence regarding their responsibilities, harsh penalties may be handed down. These include, but are not limited to, the maximum penalties for offences relating to CDD violations, record-keeping and reporting requirements, which are 15 years imprisonment or a R10 million fine. About us In the Media Contact us. Find a Specialist. Proposed amendments to FICA schedules.
Page Content. Proposed amendments to Schedule 1 Expansion of the Schedule 1 list of entities that will be subject to the customer due diligence, risk management and compliance obligations set out in FICA accountable institutions.
These FSPs will not be listed as Accountable Institutions and accordingly will not be required to comply with the obligations imposed on Accountable Institutions such as those mentioned below, which should provide some relief to those FSPs who are currently defined as Accountable Institutions. The types of entities listed in Schedule 1 Accountable Institutions must comply with a number of provisions of FICA when dealing with their customers. The proposed amendments to Schedule 2 will enable the Centre to take over the responsibility of overseeing and enforcing compliance with FICA in respect of the non-financial sector activities involving estate agents, gambling institutions, trust and company service providers and legal practitioners.
The reason for this is the low level of compliance identified in these businesses and the lack of sanctions imposed by current supervisory bodies. These are currently Motor and Krugerrand dealers.
Interested parties are invited to submit comments on the proposed amendments to National Treasury via e-mail at commentdraftlegislation treasury.
Click here to read the Consultation Paper.
0コメント