The 2008 FAIS Report Presented by Richard Rattue Copyright 2005
Agenda THE ANNUAL REPORT Section 17(4) FAIS Session 1 09. 00 -10. 30 Submission and Deadlines Report Review: Category 1 (With / out CO) Break 15 mins 10. 30 -10. 45 am Session 2 10. 45 – 11. 00 Report Review: Category 2 Session 3 11. 00 -11. 30 Report Submission : FSB Presentation Session 4 11. 30 -12. 00 Questions & Close Copyright 2008
Housekeeping Please make sure that you have registered Copies of all presentations will be on our website for download next Monday Upon receipt of payment delegates will receive our internal guidance papers on the report via email. FPI Members will get 3 CPD points Delegates will need a copy of the relevant report for this session. Please switch off cell phones Copyright 2008
Introduction Report to be completed by all FSP’s in terms of Section 17(4) of FAIS Report has four flavours Category 1 FSP’s Category 2 FSP’s Category 3 FSP’s Separate report if you do not require a CO in terms of Section 17(1) of FAIS Copyright 2008
2008 Report Overview Fewer sections overall Fewer questions due to consolidation More focus on key risk areas i. e J Reps Amalgamation of prior questions Additional Monitoring Areas for CO’s Improved structure New Sections i. e Risk Man & Terminations More Annexures for Cat 1 FSP’s No efficacy or sampling submissions required from CO’s Copyright 2008
Clarity of Terms Report Date Report Period Submission Date Copyright 2008
Gazetted Table A FSP Yr End 31 Jan 31 July 28 Feb 31 Aug 31 March 30 Sept 30 April 31 Oct 31 May 30 Nov 30 June 31 Dec 31 July 31 Dec 31 Aug 31 Dec 30 Sept 31 Dec 31 Oct 31 Dec 30 Nov 31 Dec Copyright 2008 Reporting Date 31 Dec
Revised Reporting Dates Reporting Date Submission Date 1. 31 May 15 August 2. 31 August 31 October 3. 31 December 28 February Reporting Type 1. = Cat 1 FSP’s with CO 2. = Cat 2 & 3 & Forex Only FSP’s with CO Copyright 2008 3. =FSP’s that DO NOT require a CO
Report Columns 1 Yes compliant 2 No non compliant 3 Not applicable Cannot enter in shaded areas of report 4 Developmental areas of concern identified and are to be fixed in a reasonable time frame 5 Annexures or numbers Number your submissions correctly Copyright 2008
1. License Conditions and Restrictions / Financial Products Fewer questions Advise Registrar within 15 days of any changes 1. 4. 1 / 1. 4. 2 Details of other regulators 1. 5. 4 – Details of related parties where applicable 2. Key Individuals Copyright 2008 Control of K. I. ’s. Changes in circumstances. Fit and Proper Advancement 2. 3. 3 Procedures to meet Column 4
3. FSP License Display of original or certified copy of license at every business premises. 4. Representatives Copyright 2008 4. 3 / 4. 4 Juristic Rep Controls Keeping control of your Reps and their Fit & Proper status. Disclosure of supervised Reps and status and No of supervisors Ongoing reviews /assessment of Reps under supervision. Attachments re procedures 4. 5. 3. 8. Non compliance Report Compliance of all Reps with the Gen Code of Conduct. Debarment Details.
5. Insurance Cover Fidelity guarantee provides an employer with insurance cover for financial loss resulting from an employee's dishonesty. PI Cover: purpose is to cover your company against the potential liability and claims caused as a result of the professional work you undertake. Guarantees: A guarantee is effected to provide protection against an uninsured contingencies Intermediaries Guarantee Facility (IGF). Copyright 2008
6. Compliance Function. Status of Compliance Function Copyright 2008 CO Function Status Regular reports submitted by the CO. Quarterly Removed Number of visits for outsourced CO’s 6. 4 CO to highlight additional issues Efficacy Statement Removed
7. Record Keeping. Section 18 verbal communications with clients complaints. non compliance i. e. /breaches register premature cancellation of transactions. Continued compliance of Reps Section 3. 2 Gencode. electronic /safe storage etc accessible within 7 days Longevity ( 5 years after product termination date. Copyright 2008
8. General Code of Conduct. 8. 1 General Provisions. 8. 1. 1 Conflict of Interest Policy 8. 1. 2 Submit as an Annexure Receipt of non cash incentives. Disclosure thereof. 8. 2 Disclosures. 8. 2. 1. Direct Marketer 8. 2. 3. Details of non compliance iro Section 4, 5, 7. of General Code 8. 2. 4. Provide copy of disclosure doc as an Annexure Copyright 2008
8. 3 Direct Marketing Voice recording systems in place CO monitoring of disclosures required 8. 3. 2. 4 Non Compliance Annexure Required 8. 4 Advice CO monitoring of Analysis and Record of Advice required 8. 4. 2. 5 % iro Section 8(4)a 8. 4. 2. 6 Non Compliance Annexure Required –Record of Advice Copyright 2008
8. 5 Fund Custody. If yes you need. Auditor. Section 19(3) Report Separate Accounts Premium Collection Section 45 of STI Act 8. 5. 4 – Amount of IGF Cover 8. 5. 5 – IGF Number 8. 5. 6 - IGF Cover Schedule CO to monitor procedures Copyright 2008
8. 6 Risk Management. Section 11 & 12 Gen Code 8. 6. 2 RM Plan Documented 8. 6. 3 CO to monitor RM Plan 8. 6. 4 Submit details of how RM plan is monitored 8. 7 Advertising. 8. 7. 1 –Does FSP Advertise Procedures in place to comply with Section 14. Telephonic Advertising CO to monitor voice logging 8. 8 Complaints. Resolution mechanisms that comply with Sections 16 -19 of the Gen code Records of Complaints 8. 8. 3 CO to submit annexure Copyright 2008
8. 9 Termination Procedures to comply with Section 20 (Termination of client relationship) (Termination of FSP business) (Termination of Rep) 8. 10 Waiver of Rights. Reps to use approved documents to ensure no waiver of rights is requested or induced form the client. 8. 10. 2 –CO Required to monitor compliance with Sect 21 of Gen Code 8. 10. 3 – Details of non compliance on Annexure Copyright 2008
9. Exemptions Board Notice 104 Temp Exemption for Cat A providers from minimum qualifications. Board Notice 97 Exemption of executors , liquidators and other related persons. 9. 2. 2. 1. –CO Required to monitor compliance with BN 97 9. 2. 2. 2 – Details of non compliance on Annexure Copyright 2008
10. Money Laundering Control Customer Identification Record Keeping Staff Training Reporting Copy of Internal rules required Money Laundering Control officer details FICA Exemption 4 Usage 10. 7. Procedures to enable staff to identify and report 10. 8 Procedures to Risk Rate clients 11. Financial Soundness Solvency Requirements Section 19 Monthly Records Copyright 2008
SECTION 2 – Forex FSP’s Consolidated Questions in 2008 Forex FSP’s Duties & Obligations 12. 1 -12. 4 Forex Investment Advisors 12. 5. 1 12. 5. 8 12. 5. 5 Details of trading platform /system used Copyright 2008
SECTION 3 - Health Service Benefits 13. 2. 1 – Details of Suspensions , withdrawals or lapses in Annexure 13. 2. 2. - ORG and BR numbers required 13. 2. 3 – Corporate Client Info Copyright 2008
Section 4 Attachments and Signature All attachments to be referenced to the relevant question number Both Compliance Officer and a key individual to sign off the report before submission is made to the regulator Copyright 2008
Compliance Report 2008 NO CO To be completed by all individuals who do not need to appoint a compliance officer in terms of Section 17(1) of FAIS Slimmed down version. Less annexures No sampling Signed off by KI of FSP Copyright 2008
Report Structure SECTION 1. To be completed by all FSP’s SECTION 2. Forex FSP’s Only SECTION 3 Health Services Benefits SECTION 4 Annexure(s) and sign off Copyright 2008
1. License Conditions Updating Information Financial Product Controls 1. 4 Other Regulators –New Annexure 1. 5. 4 Related Party Information 2. Key Individuals Circumstances and Conditions 2. 2 Column 4 Fit and Proper 3. License Display Original or Certified copy 4. Staff Compliment Annexure Required 5. Insurance Cover Copyright 2008
Section Overview 6 Compliance function 7 Record keeping 8. 1 General Provisions 8. 2 Disclosure 8. 3 Direct Marketing 8. 4 Advice 8. 5 Product custody 8. 6 Risk Management 8. 7 Advertising 8. 8 Complaints 8. 9 Termination of Agreement or Business 8. 10 Waiver of rights 9. 0 Exemptions 10 Money Laundering 11 Financial soundness Copyright 2008
15 min Break Copyright 2008
Welcome back to the second session Copyright 2008
Discretionary FSP’s Section 1 - same as Category 1 FSP’s. Except 9. 3 Additional Exemption BN 15 of 2008 (Supervision) 9. 3. 1 CO to report on usage by FSP Section 2 12. 1 Obligations /Prohibitions 12. 2 Mandates 12. 3. Reporting 12. 3. 2 Section 6 Compliance Copyright 2008
Discretionary FSP’s 12. 4 Administration 12. 4. 2 Details of Computer packages iro admin 12. 4. 3 Outsource arrangements iro admin 12. 5 Assets under Management 12. 5. 2 Audit Status of accounts Nominee Companies Questions Consolidated General Functions Wrap Fund Details Hedge Fund Details 12. 7. 5 Names of product supplier used by HF FSP Copyright 2008
FSB Presentation Ronel Reyneke Specialist Analyst FAIS SUPERVISION Copyright 2008
Closing thoughts Take it seriously Honesty is the best policy. Compliance Officer / Key Individual should not compromise report content. Get it in on time. Copyright 2008
Knowledge Service (Logon for 14 Day Free Trial) Financial Services Compliance Portal Key Regulatory Information at your fingertips Targeted to the Compliance Community Internal CO’s Compliance Practices Copyright 2008
Thank you We hope to see you again soon Copyright 2008
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