FSCA issues fines of nearly R30 million

12 September 2022
Accounting
South African Accounting Academy

The FSCA found that Praesidium Advisory did not have the correct financial services provider [FSP] licence to advise members of the public to invest in forex instruments. It also did not have the correct licence to receive client funds for the purposes of investment in forex instruments.

The investment schemes run by Praesidium Advisory Services, Praesidium Wealth and Praesidium Sentinel, as well as Octox and Imagina FX, crashed in 2019 after operating since around 2015, leaving millions of rands unaccounted for.

At the time the schemes crashed, authorities estimated that people had invested around R1.4 billion, barely R300 million of which was actually used for trading.

The following people have been debarred from the industry:
- Craig Massyn (a director and someone who was supposed to trade the forex markets), for a period of 20 years;
- Brett Bukes (a director), for a period of 10 years;
- Andrew Cunningham-Moorat (a director), for a period of 10 years;
- Cindy Lee Schuster (a key individual), for a period of 5 years; and
- Ryan Van Niekerk (a key individual), for a period of 5 years.
The FSCA has imposed the following administrative penalties on:
- R20 million on Massyn;
- R6.5 million on Bukes;
- R2.5 million on Cunningham-Moorat;
- R300 000 on Schuster; and
- R300 000 on Van Niekerk

The FSCA will now formally bring this matter to the attention of the criminal authorities because it seems likely that several offences have been committed, including fraud and theft.

Click here to download the FSCA Media Release:

https://www.fsca.co.za/News%20Documents/FSCA%20Press%20Release%20-FSCA%20finalises%20its%20investigations%20into%20the%20Praesidium%20Group%20of%20entities%205%20September%202022.pdf

Relevance to Auditors, Independent Reviewers & Accountants:

Auditors, independent reviewers and accountants must ensure that they are aware of the latest news that is published by regulators, such as the FSCA.
Both the FSCA and the South African Reserve Bank repeat the usual warning: “If it sounds too good to be true…”
Individuals need to ensure that they only deal with reputable, registered FSPs.

Relevance to Your clients:

Individuals need to ensure that they only deal with reputable, registered FSPs.
Both the FSCA and the South African Reserve Bank repeat the usual warning: “If it sounds too good to be true…”

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