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FIC: Sanctions and enforcement 2024
- 08 January 2025
- Regulatory Compliance and Legislation
- South African Accounting Academy
Summary:
The Financial Intelligence Centre (FIC) has issued a media release setting out various Sanctions and Enforcement actions imposed for the year from November 2023 to November 2024.
Article:
A host of businesses that have not complied with FIC requirements in terms of Directives 6 and 7, to submit risk and compliance returns (RCRs), are facing financial penalties ranging from R10 000 to R50 000.
On 31 March 2023, the Financial Intelligence Centre (FIC) gazetted two directives in terms of section 43A(3)(a) of the Financial Intelligence Centre Act, 2001 (Act 38 of 2001), calling upon businesses in identified sectors to file RCRs.
- Directive 6 referred to legal practitioners, trust and company service providers, estate agents and gambling institutions.
- Directive 7 referred to credit providers, the South African Post Bank, high-value goods dealers, the South African Mint Company and crypto asset service providers.
- Directive 6 sectors had the deadline of 31 May 2023 for submission of RCRs, while those included in Directive 7 had until 31 July 2023.
Resulting from the lack of submission of RCRs, the FIC has imposed admission of non-compliant sanctions on 286 institutions as set out in a table in the media release.
The requirement for filing RCRs is integral to ensuring that the country’s businesses are aware of how they can be used for laundering proceeds acquired through criminal activities. Filing a RCR is thus central to ensuring that businesses survive and are robust in the fight against financial crime. This is particularly significant as, in the last mutual evaluation of South Africa, FATF found South African businesses to be lacking awareness of the money laundering and terrorist financing risks they faced which in part has led to the country being grey listed.
Click here to download the 4-page Media Release:
https://www.fic.gov.za/wp-content/uploads/2024/12/Media-release-Sanctions-and-enforcement-2024.pdf
Relevance to Auditors, Independent Reviewers & Accountants:
- Auditors, Independent Reviewers and Accountants should be aware of the latest publications and updated information issued by regulators, such as the FIC – to enable their assessment of accountable institutions’ compliance with FICA.
- When advising clients or performing this function on their behalf, practitioners should keep themselves informed of developments on the enforcement front.
Relevance to Your Clients:
- Relevant Accountable Institutions (companies and CCs) should be aware of the latest publications and updated information issued by regulators, such as the FIC.