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Capfin slapped with compliance notice

By Staff Writer
By Hennie Pretorius, journalist, Justmoney
 
In a press release earlier this week the National Credit Regulator (NCR) stated that it has issued a compliance notice to Southern View Finance UK Limited, a registered credit provider trading as Capfin, for being in breach of National Credit Act 34 of 2005.
 
The NCR has found through its investigation that Capfin does not follow proper procedure when approving loans. When loans are being applied for, verification of income is essential, a procedure lacking when loans are applied for at Capfin, according to the NCR.
 
The NCR has also stated that Capfin’s advertising is misleading, in that it did not provide the client with all the necessary information for applying for a loan. In addition to this, Capfin is not keeping any “records of documentation” to support the necessary affordability assessments.
 
Capfin’s response
 
After emailing Capfin for comment Marthie Horn, legal and compliance manager at Capfin confirmed that on 19 August 2014 Capfin received a compliance notice from the NCR.
 
 “Capfin takes its obligations under the National Credit Act (NCA) seriously and respects the authority of the NCR.
 
“Capfin is confident that the processes and procedures comply fully with the provisions of the NCA, the regulations issued in terms of the NCA and the affordability assessment guidelines and is comfortable that it [Capfin] will be able to address the NCR’s concerns in this regard.
 
“Capfin will, however, nonetheless carefully consider the compliance notice issued by the NCR and, in due course, take the necessary and appropriate steps,” said Horn.
 
What is expected from Capfin
 
Jacqueline Boucher, legal advisor for the NCR, said Capfin has been told to rectify the situation by implementing correct loans procedures in line with the NCA:
 
“We’ve asked them to get an auditor to have a look at their processes and to indicate to us that they have remedied the compliance issues that we have found and then to supply us with that audit report.”
 
Failure to do so will result in further action taken by the NCR.
 
“The regulator reserves its right in terms of the compliance notice to take further enforcement action based on the compliance notice… but at this point in time it’s just a compliance notice to remedy the situation,” said Boucher.
 
Boucher added that the compliance notice will not affect current Capfin customers in any way and is merely a chance for Capfin to rectify their non-compliance with the NCA.
 
Capfin have 30 days from the date they received the compliance notice to comply.

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