In this case, an appeal was made to the Financial Intelligence Centre Appeal Board regarding the imposition of financial penalties issued against the company in terms of the Financial Intelligence Centre (FIC) Act. The Appellant is an authorised dealer with limited authority (ADLA) in foreign exchange. The Respondent is the Financial Surveillance Department of the South Africa Reserve Bank, a supervisory body responsible for monitoring whether ADLAs comply with the Act, its Regulations and the Exchange Control Regulations.
An inspection at the Appellant’s head office revealed irregularities and contraventions. The findings made were as follows:
- Failure to appoint a compliance officer in terms of Section 43(b) of FICA;
- Its Internal Rules failed to comply with the prescribed requirements;
- Failure to identify and verify clients in terms of Section 21 of the Act;
- Failure to provide proper training to its employees, in terms of Section 43(a) to enable them to comply with the provisions of the Act;
The Appellant was directed to rectify these contraventions in terms of these findings. At further off-site inspections conducted, the Appellant was requested to adhere to the non-compliant areas identified and to respond to the findings made.
The following penalties were imposed against the foreign exchange dealer:
- A financial penalty of R80 000 for failing to comply with Section 21 of the Act.
- A financial penalty of R50 000 for failing to comply with Section 43(a) of the Act.
- A financial penalty of R50 000 for failing to comply with Section 43(b) of the Act.
- A directive issued in terms of Section 45C(3)(c) of the Act, directing the Appellant to present a remedial action plan.
- The appellant’s licence was suspended and later permanently withdrawn.
The Appellant’s appeal was not against the merits of the findings, but whether a fair process was followed by the Respondent. The Appellant’s appeal was dismissed as he failed to indicate that the Head of Department only rubberstamped the final report of the panel and this was found to be without substance.