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Overview and preparation techniques

Overview and preparation techniques. Presented by the Inspired Learning Regulatory Academy. Minimum license requirements. Competency Product Category ,minimum experience, academic qualifications, Conditions. Operational Ability

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Overview and preparation techniques

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  1. Overview and preparation techniques Presented by the Inspired Learning Regulatory Academy

  2. Minimum license requirements • Competency • Product Category ,minimum experience, academic qualifications, Conditions • Operational Ability • Business address, communication facilities, bank account, money laundering controls, • Sound financial security • No unrehabilitated insolvent • Assets exceed liabilities Fit and Proper • Honesty and Integrity • Good character and integrity • Found guilty, fined , prohibited Court of Law or civil matter etc

  3. Use of license • Displayed in prominent and durable manner • Reference in all business documentation, advertisements, promotional material • Not use license when withdrawn or suspended • Immediately or within reasonable time available Outcome 16

  4. Compliance provisions within FSP • Effectively employ resources, procedures and appropriate technological systems • Structure internal control procedures to ensure business carried on in orderly and efficient manner • Control Measures • Specific Control Measures • Insurance • Advertising • May not contain statement, promise or forecast which is fraudulent, untrue or misleading • Have suitable guarantees or professional indemnity Outcome 43

  5. Appointment of compliance officer No one can act as rep unless He has employment or mandate agreement with FSP Outcome 43

  6. Role / function of compliance officer Source: Board Notice 127 Outcome 43

  7. Role / function of compliance officer Source: FAIS Act Section 17 • FSP must establish and maintain procedures to be followed by provider and Reps to ensure compliance • CO must submit reports to registrar in manner and in matters determined by registrar • Provisions also apply to FSP who has 1 key individual or without a representative Outcome 43

  8. Functions of compliance officer Source: Section 17 of FAIS Act and www.fsa.gov • The CO is required to supervise the compliance function. This CO must ensure requirements of FAIS met through procedures which the FSP (key individual) must establish. These may be: • Examination of the compliance function at the time of license application; • Direct examination of the compliance function as part of the general on-site inspections of the FSP • Direct examination of the internal policies and operational procedures and controls • Periodic assessment which should be filed with the regulators for review • Revising and re-examination of the compliance function where issues had previously been identified with the FSP about the operation of the function. Outcome 43

  9. Undesirable business practice Source: Section 34 of FAIS Act • Harming relationships • If practice continues objectives of Act will be defeated • Unreasonably prejudicing client Practice directly or indirectly • Unfairly effecting any client • Deceiving any client Outcome 13

  10. Registrar publishes undesirable notice Outcome 14

  11. License suspension • Registrar may suspend or withdraw license at any time if • Licensee no longer meets fit and proper requirements • Licensee did not make full disclosure on license application form • Failed to comply with other provisions of FAIS • Is liable to pay levy or administrative sanction Outcome 17

  12. License withdrawal • Registrar must make known the reasons for the suspension or withdrawal and any terms attached thereto by notice in the Gazette • Provisionally suspend or withdraw a licence. Grounds therefore and period and terms of suspension • Make known the suspension or withdrawal in the Gazette • Give licensee reasonable time to respond Outcome 17

  13. Recourse for license suspension Source: FAIS Act Section 9 The Registrar must consider a response received from the licensee and may decide to: • Lift the provisional suspension or withdrawal • Make it final The licensee must be advised accordingly and notification must happen in the Gazette and other media if necessary. If a license is suspended or withdrawn, the licensee is not authorised to act as a FSP. Outcome 18

  14. Lapsing of a license • Licensee becomes permanently disabled • Finally sequestrated • Dies • Finally liquidated or dissolved • License becomes dormant • Licensee voluntarily and finally surrenders license to Registrar • Advise registrar in writing Outcome 19

  15. Lapsing vs suspension/ withdrawals Source: FAIS Act Section 11 • Lapsing of a license is the result of factors other than non-compliance: • Lapsing of the license is initiated by the FSP, following an event that gave rise it • There are no provisions in the Act to reinstate a lapsed license. • There are no requirements for debarment on lapsing of a license • There are no implications from other legislation when a license is lapsed • Suspension or withdrawal of a license is the result of non-compliance with the requirements of the FAIS Act: • Originates as a result of FSP actions or omissions • FSB may allow reinstatement of suspended or withdrawn licenses under certain conditions • After suspension or withdrawal a FSP will be debarred to apply for a new license. • There are implications for FSP’s registered under the Medical Schemes Act as the FSP will loose the accreditation if the license is suspended • when a license is lapsed Outcome 20

  16. Reinstatement of license Source: FAIS Act Section 11 1. There are no provision in the Act to reinstate a lapsed license. A new application must be submitted . But this can only happen if that entity has not been permanently disbarred from receiving a license for that product category 2. The Registrar can reinstate a suspended license once all the conditions have been met 3. The Registrar may impose conditions if a suspension or withdrawal is lifted. These conditions may include certain actions by the FSP in relation to its business Outcome 21

  17. reinstatement of authorisation imposed The Registrar must consider a response received from the licensee and may decide to: • Lift the provisional suspension or withdrawal • Make it final • Withdrawn license cannot be reinstated • Registrar can reinstate withdrawn license once conditions met • Registrar can impose conditions is suspension lifted Outcome 22

  18. Determinations by Ombud • Registrar informs licensee of intention to suspend and gives reasonable time for submission • Inform licensee of intended period and terms of suspension • Prohibition on concluding new business from date of suspension • For unconcluded business determine measures for protection in interests of clients of licensee • Terms for lifting of the suspension • Registrar must consider any response received and may suspend or withdraw license thereafter or not to and must notify licensee Outcome 23

  19. Complaints Source: Section 16 of FAIS Act Outcome 33

  20. Complaints continued Source: Section 17 of FAIS Act • FSP must have internal complaint resolution system and procedures • Maintain comprehensive policy and have systems / procedures for resolution • Clients must have full knowledge or resolution procedures • Access to facilities such as branch or electronic / postal means • Resolution to be fair to both client and provider Outcome 33

  21. Complaints continued again Source: Section 19 of FAIS Act Outcome 33

  22. Role and powers of Ombud Source: FAIS Act Sections 20 to 32 Outcome 23

  23. Receipt of complaints by Ombud • Ombud cannot proceed to investigate unless • Has informed other parties in writing • Is satisfied all parties have particulars of claim • All parties have had time to respond • In determining officially received complaint follow and implement any procedure • Allow any party right of legal representation • Explore any reasonable prospect of resolving complaint by settlement • May resolve complaint by conciliation , make recommendation

  24. Determinations by Ombud Source: FAIS Act Sections 20 to 32 • Dismiss complaint or uphold complaint • Make award of fair compensation to complainant • Monetary award payable may bear interest • Determination reduced to writing with all reasons • Copies to registrar and all parties concerned • May lodge appeal and appeal goes to clerk or registrar of court for determination Outcome 23

  25. Role powers and duties of registrar Outcome 14

  26. Penalties • Contravention and failure to comply • Misleading, false or deceptive statement • Conceals material fact • Guilty of offence, on conviction to fine not exceeding R 1 million • Or imprisonment not exceeding • 10 years or both Outcome 14

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