FSCA Slaps N-e-FG with Major Penalties

On 4 November 2024, the Financial Sector Conduct Authority (FSCA) issued a Press Release that serves as a stern warning for all those dealing with financial service providers. Severe sanctions were announced against key figures associated with N-e-FG, highlighting significant risks when clients' funds are mishandled.

After an in-depth investigation, the FSCA has imposed R30 million administrative penalties each on Stephanus Cornelius Jansen van Rensburg and Frederick Young Du Preez, who have been debarred for 30 years each. Jeremiah Jesaja Steyn Jansen van Rensburg faces an R8 million penalty and a 20-year debarment, while Elia Christiaan Janse van Rensburg has been debarred for 10 years.

The Charges

The investigation revealed improper management of client funds, including investing without client mandates and chanelling funds into unregulated entities where some key N-e-FG persons had personal interests. These actions violated several regulations, including the Financial Sector Regulation Act and the Financial Advisory and Intermediaries Services Act.

This case highlights the importance of ensuring due diligence when dealing with financial service providers. Accountants must be cautious about working with providers who lack proper regulation or transparency.

Avoiding Unregistered Advisors

Verify the mandate and compliance status of those managing your client's funds on the FSCA website to avoid unregistered service providers.