Latest news with #FinancialIntelligenceCentreAct
IOL News
05-07-2025
- Business
- IOL News
Banxso and Afrimarkets to challenge FSCA findings at the Financial Services Tribunal
Banxso and Afrimarkets, two leading fintech firms in Cape Town, are navigating significant regulatory challenges as the FSCA withdraws their licences. Image: FSCA Two prominent Cape Town-based fintech companies, Banxso (Pty) Ltd and Afrimarkets (Pty) Ltd, have issued responses following recent regulatory and banking developments that have impacted their operations. Banxso confirmed the final withdrawal of its financial services provider licence by the Financial Sector Conduct Authority (FSCA), as per a notice issued on 4 July 2025. The FSCA stated that Banxso had contravened various financial sector laws and no longer met the requirements to be a fit and proper financial services provider. Key findings included allegations of misappropriation of client funds, providing false or misleading information to both clients and the FSCA, and failing to act in clients' best interests. Improvements were made! In response, the company has strongly contested the FSCA's findings and announced its intention to challenge the decision through the Financial Services Tribunal and other statutory legal avenues. Banxso emphasised that it has significantly enhanced its systems and compliance frameworks and will pursue a legal strategy grounded in both procedural fairness and factual evidence. 'We are disappointed by the FSCA's decision, which in our view does not reflect the substantial engagements and improvements made. Banxso remains committed to the highest standards of client care and regulatory integrity,' according to Sean Newman, the company's spokesperson. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Afrimarkets wants clarity Meanwhile, Afrimarkets has faced temporary banking restrictions believed to be the result of a directive issued under section 34 of the Financial Intelligence Centre Act. The FSCA said that the provisional withdrawal is based on the findings of their preliminary investigation regarding the activities of Afrimarkets and its possible association with deepfake advertisements. The FSCA is also concerned about the apparent aggressive and pressurised sales techniques Afrimarkets agents use when selling financial products to clients. These restrictions, which affect certain accounts, are understood to be limited to a 10-day period. Simultaneously, the FSCA has provisionally withdrawn Afrimarkets' licence pending the outcome of an ongoing investigation. Afrimarkets said it had received no formal findings or specific allegations and is actively engaging with regulators. 'We are seeking clarity on these measures and are working closely with senior legal counsel to consider all available remedies to protect our clients and stakeholders,' Newman said, adding that all client funds remain secure and steps are being taken to urgently resume operations.
The Citizen
03-07-2025
- Business
- The Citizen
This is how Prudential Authority cracked the whip last year
The Prudential Authority promotes and enhances the safety and soundness of the financial system by regulating and supervising financial institutions. The Prudential Authority of the South African Reserve Bank cracked the whip during the previous financial year, starting investigations into 35 deposit-taking schemes and fining 16 companies R134.23 million for not complying with the Financial Intelligence Centre Act (Fica). The Prudential Authority is responsible for setting the prudential standards and regulations governing the financial sector to ensure the stability and resilience of financial institutions. The Prudential Authority has the mandate to: Promote and enhance the safety and soundness of financial institutions, such as banks and insurers Protect financial customers against the risk of institutions failing to meet their obligations Support the South African Reserve Bank in maintaining financial stability. The Prudential Authority initiated investigations into 35 illegal schemes accepting deposits from the public. Four more were added from the previous year. In the previous financial year, the Prudential Authority started with investigations into 187 new schemes not registered as insurers, with 60 added from the previous year, while 127 were completed. ALSO READ: The actual cost of non-compliance with Fica Fines from the Prudential Authority for Fica non-compliance The Prudential Authority also conducted 22 investigations at banks, life insurers and branches of foreign banks to check if they comply with anti-money laundering and combating the financing of terrorism requirements. During its inspections, the Prudential Authority found that 16 companies did not comply with the Fica and imposed administrative fines of R134.23 million. R29 million of this amount was provisionally suspended. According to the report, Capitec received the highest administrative fine of R56.25 million, with R10.5 million suspended, as well as seven warnings and a reprimand for non-compliance such as failing to adequately conduct customer due diligence, enhanced due diligence and ongoing due diligence, ensure timely cash threshold reporting, not reporting suspicious transactions and suspicious activity. Old Mutual Life Assurance Company was fined R15.9 million for similar offences, with R5.9 million provisionally suspended. The Prudential Authority also fined Standard Bank R13 million, while Escap SOC was fined R7.6 million for non-compliance with the Insurance Act and other industry standards, as well as standards for corporate management. ALSO READ: Prudential Authority and FSCA reviewing regulations for funeral insurance Extent of Prudential Authority's supervision According to the report, the Prudential Authority supervised 27 banks, including 16 banks registered in South Africa. The assets of these banks were R8 231.2 billion, 6% more than a year ago. These banks supplied loans and credit to the value of R5 873, 5% than a year before and wrote off loans to the value of R308 billion, 3% more than a year ago. The banks were also more profitable, with the average return of earnings reaching 15.8% compared to 14.8% the year before. The three mutual banks in the country had assets to the value of R4.1 billion, 11% more than a year ago, while they supplied loans and credit that were 5% higher than a year ago at R3.2 billion. These banks only started showing a profit since February 2023 after a long period of losses, with an average return of earnings increasing from 2% in the previous year to 3.8%. Loans in arrears amounted to R400 million. The Prudential Authority also supervised 155 insurers with assets of more than R4 960 billion, of which most belonged to life insurers. Insurers paid out claims to the value of R625.7 billion, almost 9% more than the year before. The Authority also supervises the Road Accident Fund and Lloyds.
The Citizen
25-06-2025
- Business
- The Citizen
Schreiber slams TymeBank CEO for ‘profiteering over people'
Home Affair this week announced it will be increasing the cost that companies must pay to verify people's identities by up to 6,500%. A spat has erupted between Home Affairs Minister Leon Schreiber and TymeBank CEO Coenraad Jonker, with the minister saying the bank is putting 'profiteering over people!' On Tuesday, Jonker criticised Home Affairs identity online verification system (OVS) check fee hike warning Schreiber in an open letter that he should reverse his decision to increase the fee for accessing identity verification services. Verification services Home Affairs this week announced it will be increasing the cost that companies must pay to verify people's identities by up to 6,500% in an effort to correct what it called 'unsustainable under-pricing of verification services.' The department also announced on Monday that it will launch an upgraded verification system for the national population register (NPR). The OVS allows third-party companies, including banks, insurance companies and mobile network operators, to verify the identities and other biographical information of their clients against the NPR. These checks are a requirement under specific legislation, including the Financial Intelligence Centre Act (Fica) and the Regulation of Interception of Communications Act (Rica). ALSO READ: TymeBank founder warns minister about fee increase for ID verification Price increase Home Affairs gazetted a new price structure for real-time identity checks, increasing the fee from 15 cents to R10 from July. For verifications during off-peak hours, companies can perform a batch of verifications for R1. The department said extreme under-pricing of the OVS led to profiteering and abuses by some users that overwhelmed the NPR and caused failure rates in excess of 50%, contributing to 'system offline' failures at Home Affairs offices and threatening national security. This is an increase of 6 500%. Tyme not happy In a strongly worded letter on Tuesday, Jonker warned that the fee hike will 'unravel years of progress in digital transformation, financial inclusion and economic justice.' 'Today, South Africa is one of the most inclusively priced countries in the world, comparing well with Panama, Colombia and Peru, at 2 US cents per identity lookup. Your new fee makes South Africa almost twice as expensive as the most expensive peer group countries, like Pakistan and Ecuador.' 'Robbing SA' Jonker said the price increase would make it impossible for Tyme to allow clients to open an account in real-time with no monthly fees. 'Your new fee will make this impossible, robbing South Africa of its only accessible and free bank account.' Jonker said Schreiber's decision shifts the cost of what should be a state-funded utility onto the shoulders of the poor. 'It imposes a regressive tax that penalises those with the least. 'Identity verification is a public good. Around the world, it is subsidised or fully funded due to its essential role in national development. Yet here, in a time when our country most needs inclusivity, innovation and trust, we choose exclusion. 'As my example illustrates, the price hike is wildly out of line with the average cost per user compared to South Africa's peer group countries,' Jonker said. ALSO READ: Home affairs ID verification cost to increase by up to 6 500% Digital world He said the R1 batch lookup fee was not a practical alternative, as real-time lookups are crucial in the digital world. Jonker said that Tyme contributed to the public participation process for the fee increase but was 'clearly ignored'. Among the suggestions he put forward in the open letter are a phased fee structure and volume-based discounts. Schreiber hits back Schreiber struck back and slammed Jonker on social media. . In a post on X, he said that banks, insurers and Cosatu recognised the need to fix the process. 'The CEO of a Unicorn worth R26,700,000,000.00 demands that taxpayers struggling to afford food must subsidise it, as it refuses to pay more than 15 cents for a service that costs vastly more to provide and that contributes to 'system offline' at Home Affairs offices?' Schreiber wrote. 'Shocking' is the fact that you paid a measly 15 cents for years, relying on taxpayers to subsidise the rest of the actual cost while you profited. 'Shocking' is that we have your CEO admitting, in writing, that he never even read our letter inviting public comment, then approached a political party from the shadows after the comment period closed to try and apply pressure, and now dishonestly claims he was not consulted. 'Shocking' is trying to prevent Home Affairs from correcting under-pricing to invest in the NPR before it cripples national security. Take your faux outrage somewhere else and stop putting profiteering over people!' Schreiber said. Mobile operators The Association of Communications and Technology (ACT), an organisation representing mobile operators such as Vodacom, MTN, and Telkom, also criticised the fee, saying that the organisation had previously written to the department to raise concerns about the process used to increase the fees. ACT said that network operators that are members of ACT may have to either absorb the cost or pass the cost of the verification on to consumers. ALSO READ: Home Affairs clears 250 000 ID backlog in one month
IOL News
23-06-2025
- IOL News
Ex-cop held over alleged political 'hit' fails in another bail bid
Bulelani Yosana is currently awaiting trial alongside accused hitman James Easton for the contract murder of Bloekombos teacher and ANC activist Vuyo Dana. Yosana's latest bail appeal bid failed in the Western Cape High Court. Image: File MURDER accused Bulelani Yosana has failed to convince the Western Cape that the State's case against him has considerably weakened after a Section 204 witness recanted on their statement. Yosana is currently awaiting trial alongside accused hitman James Easton for the contract murder of Bloekombos teacher and ANC activist Vuyo Dana. A trial date is yet to be set for the matter. After a previous unsuccessful attempt, Yosana, a former police officer and ANC branch secretary, filed a new bail bid appeal with the High Court, citing the recanted statement, that a trial date remains unset, and that his bank account is about to be closed for non-compliance with the Financial Intelligence Centre Act. Dana was shot and killed at his home in February 2022 while on his way to work at Bloekombos Senior Secondary School, in Kraaifontein, in what has been alleged to be a politically-motivated killing. Yosana brought the second bail application on the basis that new facts have arisen since the initial bail court (Regional Court) refused to admit him on bail, pending the finalisation of his trial. Yosana and Easton face a variety of charges including a contravention of Section 18 of the Riotous Assemblies Act, conspiracy to murder, and murder. Through his attorney, Yosana submitted that following the bail application hearing, and the appeal, they discovered a statement in which the Section 204 witness recanted what he stated in his Section 204 affidavit. According to Yosana's lawyer, there are no eyewitness accounts that place Yosana on the scene, and he claims that due to the recanting statement, there was insufficient evidence. 'According to Mr Booth (Yosana's attorney), this recanting statement was never discovered by the State, and as such, it alters the overall picture of the State's case. 'In this (newly) discovered statement, the Section 204 witness is recanting what he initially told the police about the involvement of the applicant (Yosana) in the commission of the offences the applicant is arraigned on. Booth advanced the argument that the State case is based primarily on the evidence of the Section 204 witness. 'Booth's argument postulates that if the Section 204 witness has recanted his original police affidavit, wherein he originally implicated the applicant in the crimes, the necessary corollary is that the State's case has since been considerably weakened. According to the applicant, this discovery presents an insurmountable hurdle for the State,' the court record read. The State did not dispute that the Section 204 witness has since recanted his first key pre-trial statement. 'According to the State's heads of argument, the Section 204 witness filed a recanting statement after the residence of the witness was visited by the applicant and after the applicant's arrest. To this end, the State specifically contends that the recanting statement is a product of interference with a State witness,' the judgment further read.
Daily Maverick
09-06-2025
- Business
- Daily Maverick
Small business, big problems — SA's entrepreneurs still face uphill battle
In post-pandemic South Africa, the phrase 'small business is the backbone of the economy' has become something of a national mantra. Small and medium enterprises account for more than 60% of jobs and roughly 40% of GDP, according to estimates from Stats SA and the Treasury, yet continue to face regulatory bottlenecks, financial exclusion and bureaucratic roadblocks that larger corporates are typically better equipped to manage. Business Maverick's latest webinar, 'Small Business, Big Problems: What Government Could Be Doing', brought together Business Maverick's editor, Neesa Moodley, Sourcefin CEO Joshua Kadish and Regent Business School's academic dean, Dr Shahiem Patel, for a candid conversation on why South Africa's entrepreneurs still face an uphill battle — and what could actually unlock progress. Forget the pitch deck: start anyway 'There's a shift,' said Patel, referring to the changes in the small-to-medium business environment in South Africa. 'You don't really need capital to launch a business. You need finance to scale a business.' This mindset shift — from funding as a prerequisite to funding as a growth tool — was echoed throughout the session. Entrepreneurs today launch Instagram stores and TikTok businesses in under an hour. What they need, increasingly, is not startup capital, but scale capital, according to Patel. Kadish agreed: 'Traditional banks in South Africa base credit decisions on past performance, collateral and tax compliance. But early-stage SMEs [small and medium enterprises] don't tick those boxes. What they need is forward-looking credit.' The irony? The very regulations designed to protect consumers are choking the businesses meant to employ them. 'It's not just red tape,' noted Moodley. 'It's the weight of compliance — especially when you're a one-person startup juggling five roles.' Death by paperwork Kadish outlined an inhibiting bureaucracy where something as basic as opening a bank account requires repeated Fica (Financial Intelligence Centre Act) submissions, even across the same financial group, causing needless hurdles for small businesses looking to enter the market. 'There's no central repository,' he noted of the process required for the verification of a business and the personal documentation required for everything from opening a bank account to lines of credit. 'You Fica yourself 14 times for 14 institutions. And even then, it takes a week to open a transactional account.' And compliance hurdles don't end there. New policies — like the Ultimate Beneficial Ownership filing regimen — threaten deregistration for startups unaware of such technicalities. Tax complexity, uncertainty about the Protection of Personal Information Act, and ambiguous VAT obligations compound the confusion. 'We need to stop seeing regulation as an inhibitor,' said Patel. 'It can be an enabler — if implemented accessibly.' Both speakers emphasised the need for a single digital compliance portal — a centralised, Application Programming Interface-enabled interface for the SA Revenue Service; Companies and Intellectual Property Commission; Compensation for Occupational Injuries and Diseases Act; Unemployment Insurance Fund, and others. The technology, they insisted, already exists. What's missing is the political will — and a user manual. A hurdle for the informal sector When asked about support for the informal sector, where millions of rands move in daily trade without tax filings, documentation, or even bank accounts, Kadish was blunt. 'Without documentation, you're confined to the informal sector,' said Kadish. 'You'll never really graduate.' The post-Covid boom in contactless payments (via tools like Yoco or SnapScan) offers new data trails — but even these haven't brought the informal economy fully into the funding fold. 'Financial institutions have long treated informal trade as no-go zones,' explained Kadish. 'That's slowly changing. But we need tailored products, not copy-paste corporate credit models.' Patel added that policy incentives, like VAT breaks or employment-linked tax deferrals, could catalyse formalisation without suffocating early-stage ventures. Red tape and repayment Public procurement — a potential growth engine for SMEs — has its own catch-22. 'To do business with the government, you often need a performance guarantee. But no one wants to issue those to small businesses,' explained Kadish. 'It's the same cycle: no track record, no credit; no credit, no growth.' 'The education gap is real,' said Patel. 'So is the mentorship gap. We need layered support — formal, informal, and from peers.' Lessons from Singapore In his closing remarks, Kadish offered a bold suggestion: learn from Singapore, long held as a symbol of fostering economic development, particularly small businesses and services in the financial sector. 'Early-stage startups there pay no tax on their first $250,000 in income,' he said. 'Investors also pay no capital gains tax, provided they invest early. And the government will match private investment rand-for-rand.' Rather than handing out grants with minimal repayment pressure — often abused and never recovered — Kadish proposed co-investment models, tax incentives and tighter public-private partnerships that reward both performance and transparency. South Africa's current grant schemes, by contrast, often suffer from weak repayment enforcement, limited milestone tracking and low auditability. 'Let the government earn upside too,' he argued. 'Let's get creative with how we fund risk.' Shepherding from incubators to ecosystems Patel warned against romanticising incubators or JSE boardroom mentorships as panaceas to the real challenges that those starting businesses really face. 'Executives aren't entrepreneurs,' noted Patel. 'They have different skill sets — and while their advice can be valuable, it's not always informed by the daily triage of early-stage entrepreneurship.' He highlighted initiatives at Regent Business School like the RED (Regent Enterprise Development) Hub, where students blend theory, practice and entrepreneurship into job-making ventures. Projects like biowaste-to-energy converters and automated irrigation rigs are already showing promise. The real ask of regulation: enabling, not overreach If there was one message from both speakers, it was this: the government must enable, not entangle. Patel put it plainly: 'We need electricity. Roads. Data access that's not the most expensive in the world. Regulation that protects, not paralyses.' Kadish agreed, offering a crucial perspective on the importance of basic infrastructure in enabling an environment that facilitates business development, contrasting South Africa with a country in a much more challenging situation. 'Even in Ukraine, under bombardment, the trains run. The lights stay on. Here, it often feels like war just trying to keep your bakery open,' he said. 'We talk about SMEs being critical,' concluded Moodley. 'But until support becomes accessible at scale, it's just talk.' For a country that claims SMEs are the future, South Africa has a long way to go in making that future viable. DM
