Discount Mart Cleaning Services CC, trading as DMC Holdings, has advised its shareholders that the Financial Services Providers Registrar has instructed it to dispose of the properties by way of auction or private sale and refund the shareholders’ investments. However, the Registrar denies every issuing any such instructions.
The FSB is still conducting an investigation into the affairs of DMC and its associated institutions, and therefore they cannot say what the punishment would be: “The Registrar is not in a position to indicate what type of enforcement remedy will be sought until the inspection is completed,” said Deva Govender, from the FSB enforcement unit.
Furthermore, the FSB said that the number of affected people could not be disclosed, due to the Inspection Act: “The inspection in this matter has just commenced and in terms of the Inspection Act we are prohibited from disclosing any details at this stage,” said Govender.
Last month the Financial Services Board (FSB) issued a warning against DMC. The FSB said in a statement that: “the above mentioned persons are rendering financial services without being authorised to do so in terms of the Financial Advisory and Intermediary Services Act 37 of 2002 (FAIS Act) and in particular they are not authorised to sell any financial product to the public or to receive or hold investment funds from the public.” For the full story, click here.
FAIS Act
In terms of changing legislation in order to reduce fraudulent activity, the FSB believes that there is enough legislation in place at the moment: “At this stage from a Financial Advisory and Intermediary Services (FAIS) perspective, the Registrar believes that there is adequate legislation in place. However based on the final inspection findings in this matter [of DMC Holdings], the Registrar will consider whether any further legislative enactment is necessary,” said Govender.
In order to create a safe and responsible investment environment for investors, the FAIS Act was introduced. This act contains detailed provisions and rules relating to the requirements for persons or entities wishing to offer financial services to the public.
“Such persons and entities need to be authorised (licensed) by the Registrar who will, in doing so, scrutinize the applicants for their fitness and propriety in relation to personal character qualities of honesty and integrity, competence, operational ability and financial soundness,” said the FSB.
The Registrar has referred the matter of DMC Holdings to National Consumer Commission (NCC) for consideration since property syndication falls within its jurisdiction.
Tips
If you are unsure whether the person or business offering you financial services is registered or not, please call the FSB on 0800110443, or visit their website: www.fsb.co.za.
If you would like apply for investments from a reputable financial service, click here. Or need a personal loan, click here.