Latest news with #FinancialSectorConductAuthority
IOL News
2 days ago
- Business
- IOL News
South Africa's crypto market faces regulatory reckoning amid tax demands
The Financial Sector Conduct Authority introduced licensing requirements for crypto asset service providers under the Financial Advisory and Intermediary Services Act, aiming to strengthen consumer protection by classifying crypto assets as financial products. Image: Independent Newspapers/File AS South Africa's cryptocurrency sector hurtles through a turbulent regulatory and tax landscape, evolving rules and heightened scrutiny are forcing investors and service providers to scramble for clarity. As regulatory authorities tighten their grip, questions loom large: How do capital gains taxes apply to crypto disposals? What exactly are the obligations for those simply holding digital assets? While cryptocurrencies may not be legal tender, the SA Revenue Service (Sars) has made one thing clear — it is treating them as taxable intangible assets, triggering capital gains tax upon sale or disposal. The Financial Sector Conduct Authority (FSCA) introduced licensing requirements for crypto asset service providers under the Financial Advisory and Intermediary Services (Fais) Act, aiming to strengthen consumer protection by classifying crypto assets as financial products. Meanwhile, the Gauteng High Court's recent ruling on cryptocurrencies and exchange control regulations sparked significant debate, with the SA Reserve Bank (Sarb) appealing the decision and maintaining its stance that crypto is not legal tender. As the Sarb continues to shape its regulatory approach, crypto investors and service providers face ongoing challenges in adapting to this evolving landscape. Adding another regulatory layer is the Financial Intelligence Centre (FIC), which enforces anti-money laundering and counter-terrorism financing compliance, mandating registration and reporting duties for crypto providers. This dynamic regulatory environment seeks to balance innovation with investor safety and financial stability. To get more insight on this, the Sunday Independent spoke to Sebaga Matabane, the chief executive of a leading Crypto Firm as well as a derivatives and fintech expert. Matabane is also a recognised key opinion leader in Africa's fintech and digital assets space and an FSCA-approved key individual. She brings together deep regulatory insight, strategic foresight, and operational leadership. Sebaga Matabane is a derivatives and fintech expert and a recognised key opinion leader in Africa's fintech and digital assets space. Image: Supplied Sunday Independent (SI): How does the capital gains tax framework apply to cryptocurrency disposals for individual investors in South Africa? Sebaga Matabane (SM): When an individual in South Africa sells or otherwise disposes of cryptocurrency — whether by trading, converting to fiat, or using it for purchases — it triggers a capital gains tax (CGT) event. The first R40 000 of gains annually is excluded, after which 40% of the net capital gain is included in the individual's taxable income. For those in the top tax bracket, this translates to a maximum effective CGT rate of 18%. Timing and accurate record-keeping are key, especially as Sars sharpens its focus on digital asset transactions. SI: What are the tax implications for South African crypto investors who only hold their assets without disposing of them? SM: If you're merely holding crypto without selling, converting, or using it, there's no immediate tax liability — but that doesn't mean it flies under the radar. Sars requires all crypto holdings to be declared in your tax return, even if no taxable event has occurred. Think of it as financial transparency now, to avoid compliance issues later. SI: What licensing requirements does the FSCA impose on crypto asset service providers under the Financial Advisory and Intermediary Services (FAIS) Act? SM: The FSCA now defines crypto assets as financial products, which means any business offering crypto-related services — such as exchanges, trading platforms, or wallet providers — must be licensed as a Financial Services Provider (FSP) under the FAIS Act. This includes appointing approved key individuals, meeting fit and proper requirements, having compliant governance structures, and aligning with ongoing conduct obligations. The intention is to create market integrity, promote professionalism, and ensure consumer protection. SI: How does the FSCA's classification of crypto assets as financial products impact consumer protection in the crypto market? SM: This classification is a game changer. It brings crypto under the same protective framework as other financial instruments, enabling the FSCA to monitor and act against misconduct, misrepresentation, and unfair business practices. Consumers can now benefit from advice from licensed providers, recourse mechanisms, and better disclosure standards. It sets the stage for a more trustworthy and accountable market. SI: How is the SARB approaching the regulation of cryptocurrencies, given that they are not recognised as legal tender? SM: While the SARB maintains that crypto assets do not qualify as legal tender, it acknowledges their growing influence. Its approach is cautious but strategic: it collaborates with other regulators through the Intergovernmental Fintech Working Group (IFWG), explores use cases via sandbox environments, and keeps a close eye on systemic risk, monetary sovereignty, and exchange control circumvention. The Reserve Bank's messaging is clear: crypto is not a threat to ignore, but neither is it a form of money just yet. SI: What is the significance of the Gauteng High Court ruling regarding cryptocurrencies and exchange control regulations, and how might SARB's appeal affect this? SM: The Gauteng High Court's decision that cryptocurrencies are not subject to exchange control regulations has major implications — it effectively opens the door for freer movement of crypto across borders, which could impact capital flows, financial surveillance, and offshore structuring. However, the Sarb is appealing the ruling, signalling its intent to retain oversight. If the appeal succeeds, crypto flows may be subjected to stricter monitoring and reporting, reshaping how exchanges and OTC desks operate. It's a legal pivot point to watch. SI: What challenges do crypto investors and service providers face in navigating the evolving regulatory and tax landscape in South Africa? SM: The biggest challenge is regulatory ambiguity coupled with rapid change. Investors are grappling with complex tax reporting, unclear treatment of cross-border transactions, and a lack of practical guidance. Meanwhile, service providers must juggle licensing deadlines, AML/CFT compliance, FIC registration, and a mounting expectation of institutional-grade conduct — all while trying to remain agile and innovative. Ultimately, navigating this space requires a blend of legal foresight, tax expertise, and operational discipline. It is clear that the country's cryptocurrency sector stands at a critical crossroads, caught between the forces of innovation and regulation. Yet within this turbulence lies opportunity. The regulatory reckoning now underway could very well lay the foundation for a more secure, transparent, and mature crypto market. But success will depend on the ability of players to adapt swiftly, comply fully, and anticipate the next wave of regulatory evolution. In this high-stakes game of compliance and innovation, one thing is certain: the rules are being written — and those who understand them, shape them, or break them will define the future of crypto in South Africa, and Africa as a whole. Get the real story on the go: Follow the Sunday Independent on WhatsApp.
IOL News
3 days ago
- Business
- IOL News
How can we expect senior citizens to survive on such a paltry pension
High-stakes living does have its price Death or disappearance by design? Assassination or assisted suicide? It is my suspicion that Markus Jooste, the former CEO of Steinhoff International, never committed suicide. It was a grand scheme orchestrated to simply disappear and escape accountability, with the assistance of corrupt police and high-powered politicians. Your sister newspaper in Johannesburg, The Star, corroborates that by reporting on a recent police-source disclosure that there has not been a post-mortem or morgue number. Jooste was fined R475 million by the Financial Sector Conduct Authority for accounting fraud whereby he manipulated and systematically siphoned millions from the government's pension fund. A day before a warrant for his arrest was issued, he was said to have committed suicide by gunshot at Hermanus on March 21, 2024. Gavin Watson, the former CEO of African Global Operations (Bosasa), apparently died in a car accident in Johannesburg on August 20, 2019. The same modus operandi could have played out here. The accident happened when Watson's car collided with a concrete pillar. A case of culpable homicide was opened by SAPS. Watson's death was shrouded in controversy with some speculating about the circumstances surrounding the accident. A private pathology report hinted that Watson may have been dead before the accident. Former president Jacob Zuma, who delivered the eulogy at his funeral, hinted at the possibility of an assassination. A big-league benefactor of the ANC and Cyril Ramaphosa's presidential campaign, Watson was fingered in state-capture allegations, including bribery and money laundering, during judicial hearings in January 2019. Between 2003 and 2018, his company notched up government tenders worth R12 billion. Poised on the brink of unpredictability and careful to conceal whatever troubled thoughts lurk behind their public façade, how does one accommodate his self-concept to the reality of imminent death? You've had so many victories in life until you met someone or something you can't beat. Convicted murderer and a rape fugitive, Thabo Bester staged his own death in a jail-cell fire before escaping from prison in 2022. He was recaptured in Tanzania and currently is languishing in prison.A classic case of assisted-suicide was that of Brett Kebble, the mining magnate who was shot seven times on the night of September 27, 2005. The circumstances surrounding his death are complex and shrouded in controversy. Investigations revealed that Kebble's death was an assisted-suicide orchestrated by himself. His security chief, Clinton Nassif, reportedly hired hitmen Micky Schultz, Nigel McGurk and Faizel Smith to put Kebble in an early flight. The reasons behind Kebble's death were linked to his financial troubles and alleged corporate fraud, including the misappropriation of R2bn worth of shares from one of his companies. As a nation, we need to believe in the necessity for truth. Whether it was a 'mares nest' or not, only time will tell. For now innuendo and conjecture will continue to fan the flames of scuttlebutt around the fire, while we warm ourselves to paranoid perceptions. From the above brief accounts, we can deduce that these were individuals whose modus vivendi (way of living)was the pursuit of power and pelf, and that they were politically connected and ruthlessly embraced the lure of greed and self-aggrandisement by engaging in graft, bribery, corruption, racketeering and money laundering. | KEVIN GOVENDER uMhlatazana Our senior citizens really deserve better The more our country's people read, think and understand our so-called Government of National Unity's (GNU) support for our pensioners the more the government's insensitivity and care-not-a-damn attitude are revealed. In a survey of 90 countries where elderly people can live comfortably South Africa ranks 84th. Because of the poor support and care of government ministers, the life expectancy among our pensioners is 64, contrasting with Switzerland's 84. Even with their tested glasses and cataracts removed these ministers cannot see that they are making our senior citizens suffer. A disgraceful set of ministers who are showing no mercy are destroying the life of our poor, old age citizens. In South Africa pensioners receive a piddling R2 200 per month. Zambia provides a pension equivalent to R3 830 per month. What has gone wrong in this country? How can these old people live when they face innumerable challenges almost daily in their twilight years? They have to look for money to pay rent, pay for services, buy food, pay for medical expenses, pay school fees, and take care of university education, attend to different kinds of sickness and have a whole lot of other worries. Yet the 'kings' of this country, that is ministers and parliamentarians, are living in the lap of luxury at the expense of the taxpayer. You and I are being robbed. Ministers earn in excess of R300 000 per month, pensioners get R2 200. How do these ministers sleep at night? Knowing how corrupt some of these so-called 'leaders' sitting in Cape Town are, is it possible that they are taking heavy drugs?These drugs have an effect on their thinking capacity because some come to parliament to sleep. Incidentally many sleep with their eyes open. I want to offer two pieces of advice to our lawmakers: ■ Increase old-age pension to a minimum of R3 830 per month. ■ Give every pensioner a bonus cheque during Christmas – that is give them a double payment in December. However, if these so-called 'leaders' feel guilty, they could ask treasury to pay all parliamentarians and ministers only 10% of what they get. Since I am still an IFP member, I would ask all ministers and the deputy ministers of the IFP to move a motion in parliament according to my proposal. If Dr Mangosutho Buthelezi were alive were alive today, he would fire all of them. | KAMAL PANDAY Reservoir Hills Great idea. Let's roll back climate change Last Thursday's image of high-rise buildings towering into the sky is very significant. It was like trees in a jungle competing with one another for sunlight. But only here it seems the high-rise buildings in China's Chongqing municipality were reaching up into the sky for fresh air! It looks so dense it could be suffocating. How dreary the picture looks! All over the world there's an influx of people from rural villages into the cities because they are seeking the comforts of the modern world. As this trend gains momentum, there's a proliferation of man- made concrete jungles, like the one in Chongqing. Modern man does not plant trees, instead he builds concrete jungles, but they come at a heavy price. The globe's population explosion has seen the rapid spread of urban life with disastrous consequences for the environment, ecosystems and wild life. If you want to know why so many natural disasters – from droughts to wildfires to floods, among other – are occurring around the world, look no further than our smog-filled cities. It is unchecked human activity that's at the root of climate change. Temperatures in Europe are soaring because it is heavily urbanised. There were record-breaking temperatures in June. Of course, there are others who will dispute this, but how blind could they be? Concern is mounting worldwide about the ever-increasing temperatures. Our country has joined the growing chorus of voices calling for measures to halt climate change and the Department of Forestry, Fisheries and the Environment has an ambitious plan to plant a million trees on Heritage Day. Wonderful idea! I hope this initiative gains ground and we can roll back climate change. | T Markandan Kloof DAILY NEWS
The Citizen
3 days ago
- Business
- The Citizen
FSCA issued fines to the value of almost R200 million last year
The FSCA is an independent institution established to ensure a fair and stable financial market where consumers are informed and protected. The Financial Sector Conduct Authority (FSCA) issued fines for various contraventions of financial laws last year to the value of almost R200 million, with an increase of 59% in new cases between 1 April last year and 31 March this year. According to the FSCA Regulatory Actions Report, the authority debarred 131 people, issued 107 public warnings, referred 14 enforceable undertakings to the police, finalised 633 investigations, suspended 24 licences, withdrew 382 licences and issued 13 directives. This was the third edition of the report, which aims to advance the FSCA's strategic objective of upholding confidence and integrity in the financial sector by increasing the visibility of enforcement activities, deterring misconduct, and raising awareness of regulatory requirements. The report also reflects the FSCA's ongoing efforts to embed the principles of Treating Customers Fairly across the sector and to take firm action against misconduct. These efforts are essential to building and maintaining trust in financial institutions and markets. ALSO READ: FSCA fines Middelburg insurance broker R1 million and debars her for 15 years FSCA protects integrity of financial institutions Gerhard Van Deventer, divisional executive for enforcement at the FSCA, says to support these objectives, the FSCA implemented mechanisms aligned with the Protected Disclosures Act and ensuring confidentiality and anonymity where required, including a dedicated whistle-blower hotline, a protected disclosure protocol and flexible reporting channels to facilitate the submission of information to enforcement teams. Van Deventer says financial customers must be able to rely on the integrity of licensed institutions, and the FSCA acts decisively where conduct poses material risks, as reflected in the number of debarments and licence withdrawals. Cases involving unregistered insurance business increased by more than 134%, with most linked to the funeral parlour sector, Van Deventer says. The report details a range of enforcement actions, including the imposition of 51 administrative penalties amounting to R119 829 523. R82 443 540 was imposed for contraventions of the Financial Advisory and Intermediary Services Act, while a total of R68 million was imposed on the investigated parties in the N-e-FG matter, where funds were invested without the consent of clients. Penalties of another R16 985 000 were imposed for contraventions of the Financial Intelligence Centre Act for failing to implement measures to stop money laundering and terrorist financing. ALSO READ: FSCA fines 2 pension fund bosses R30 million each, debars them for 30 years FSCA's key objective to protect financial customers Van Deventer says the FSCA's key objective is the protection of financial customers, and therefore, 131 individuals were debarred, mostly for dishonest conduct and false policies. 'This marks a decline from the previous period, likely due to targeted interventions and greater public visibility.' Suspensions and withdrawals of licences were done to protect financial customers. Van Deventer says the FSCA can suspend a license where the non-compliance can be remedied, and the number of suspended licences decreased significantly, while licence withdrawals, on the other hand, increased markedly. 'This shift is primarily due to the process cycle for suspensions and withdrawals related to the non-submission of statutory returns. Over 90% of licence withdrawals were due to non-submission of returns, while the rest were linked to serious misconduct.' Van Deventer says contraventions of the Financial Sector Regulation Act, including impersonation of FSCA personnel and unlawful association, are part of a growing global trend in online harm. ALSO READ: FSCA's Regulatory Actions Report shows impressive numbers of enforcement FSCA identified these risk areas with heightened risk He points out that the report underscores several heightened risk areas that will inform the FSCA's enforcement priorities in the year ahead: Online harm, including social media scams, signal providers and finfluencers. Misuse of financial licences to front unauthorised operations. Regulatory examination fraud. Misleading advertising and inappropriate product claims. Non-compliance with AML/CFT risk and control frameworks. Since crypto has been recognised as a financial product, a dedicated investigation team has been investigating unlicensed crypto traders. By 12 May this year, the FSCA received 453 licence applications, with 264 approved, 109 voluntarily withdrawn, and 11 declined. The FSCA launched 36 crypto investigations and closed 21, while 15 are ongoing.
Bloomberg
4 days ago
- Business
- Bloomberg
South Africa's Financial Cop Beefs Up to Take Down Online Scams
South Africa's financial-markets regulator is ramping up its operations to combat an explosion in online scams. The Financial Sector Conduct Authority will spend 200 million rand ($11 million) over the next 18 months to build up the supervisory muscle to beef up monitoring and enforcement.
IOL News
04-07-2025
- Business
- IOL News
Insurance in Crisis: Lessons from the Eastern Cape Floods
Reflecting on the devastating floods in the Eastern Cape, this article explores the critical issue of underinsurance in South Africa and the urgent need for public trust in the insurance sector. Image: Pedro Mapelo / I'solezwe lesiXhosa By Dr Darlene Kalonji Mbukula As we celebrated International Insurance day on June 28, it's a time to reflect on how we safeguard our future. But this year, reflection is overshadowed by tragedy. The Eastern Cape has been devastated by floods that have claimed over 90 lives and displaced thousands. These events have exposed a critical vulnerability of underinsurance. As we mourn and rebuild, it's clear that restoring public trust in insurance is not just an industry concern—it's a national imperative. These crises, be it climate-driven or socially triggered reveal a shared vulnerability of underinsurance. The Financial Sector Conduct Authority's (FSCA) 2023 Retail Financial Customer Behaviour and Sentiment Study paints a stark picture. It reveals that over 40% of South Africans lack confidence in understanding insurance products, and a third believe insurers deliberately avoid paying claims. Thirty-five percent let policies lapse, citing not only cost but uncertainty about value that policies add to their lives. This trust deficit that is rooted in complex policies, unpaid claims, and historical exclusion, keeps insurance out of reach for millions, particularly in rural and peri-urban areas. Underinsurance is not just a personal risk; it's a societal one. When disaster strikes, uninsured households often resort to selling assets, taking high-interest loans, or relying on overstretched community networks. This perpetuates cycles of poverty and financial exclusion, undermining South Africa's broader economic resilience. The Eastern Cape and KZN crises show how climate and social risks amplify these vulnerabilities, hitting underinsured communities the hardest. Many affected businesses and households cited that they were under insured or not insured at all due to the misconception that insurance is for big businesses or households in elite areas. A clear indication that the public does not fully trust the insurance sector nor are they informed. The insurance sector must confront its shortcomings. For too long, providers have focused on urban elites, offering solutions that are inaccessible to low-income households. Jargon-filled policies, unresponsive call centres, and opaque claims processes erode confidence. The FSCA's 2023 study confirms this. Nedbank Insurance is taking steps to lead this transformation. Through its bancassurance model, it integrates insurance into clients' financial lives with four key pillars: Trust: As a licensed insurer, Nedbank Insurance adheres to strict compliance and fairness standards, giving clients confidence that their claims will be honoured. Accessibility: Insurance is available across multiple channels—mobile apps, ATMs, branches, and call centres—making it easy for clients to engage wherever they bank. Integration: Clients can seamlessly add insurance to financial products like home loans, ensuring coverage for buildings, contents, and natural disasters. Simplicity: By using plain language and intuitive digital tools, Nedbank reduces the cognitive burden of choosing insurance, making it feel natural rather than intimidating The Eastern Cape floods and KZN riots are not isolated tragedies in thiscountry. They are warnings of a future where climate and social risks converge. Without trusted insurance, vulnerable communities face cascading and insurmountable losses. South Africans therefore must seek insurers that place trust at the centre of their operations. Insurance month should serve as a conversation starter and through the Money Matters Series that Nedbank Insurance has launched, they are committed to bringing the conversations exactly where South Africans are. From the streets of Jozi, the villages in the Eastern Cape or the townships of KZN, everybody must participate and get the correct coverage for their life stage. Climate change and social tragedies have proven that insurance is more than just funeral policies. People should not wait for the next crisis to consider insurance. At Nedbank Insurance, we believe insurance should not be a privilege—it should be a promise. A promise of protection, peace of mind, and recovery when the unexpected happens. So let's start the conversation. Let's talk about insurance—the kind you can trust. * Dr Darlene Kalonji Mbukula is the Executive Head of Client Experience at Nedbank Insurance ** The views expressed do not necessarily reflect the views of IOL or Independent Media.
