Thebe Stockbroking was referred to the Enforcement Committee of the FSB by the Registrar of Securities Services for contravention of Section 21(1)(a) and 21(2)(a) of the Financial Intelligence Centre Act (FICA), 38 of 2001.
Section 21 of the Act pertains to identifying clients. In other words, verifying the identity of a client, or if a client is representing another person, verifying the identity of that person.
According to the FSB, Thebe Stockbroking has admitted to contravening the Act and agreed to settle the case.
When determining the penalty for the contraventions, the Registrar took into consideration the following:
- That Thebe Stockbroking made an effort to rectify the non-compliance and were “largely successful in doing so.”
- They willingly disclosed the irregularities that were identified to the JSE (Johannesburg Stock Exchange), their direct supervisor.
- Thebe Stockbroking implemented a system that would ensure future compliance with the Act for clients opening accounts.
Furthermore, the Registrar noted that many of the accounts that were non-compliant were dormant “when the relevant provisions of the Act came into operation,” as well as there not being a previous determination made against Thebe Stockbroking.
In light of the above, the Registrar and Thebe Stockbroking agreed to a penalty of R500 000.