Author Archive | Alan Holton


Professional Indemnity Insurance and exclusions

A recent decision of the High Court in Bloemfontein where an FSP was found to have been negligent in advising a client to invest in the Sharemax scheme, is a “must read” for all FSPs. Clear and explicit, the judgement sets out unequivocally just what the duties and responsibilities of a financial advisor comprise. There […]

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New steps to curb Churning

The Retail Distribution Review (RDR) of 2014 contained several comments that expressed concern about the negative effects of “churning” which it described as “inappropriate or unnecessary replacement of policies driven by intermediary incentives”. For example, Proposal NN contains the observation that “Analysis of the current distribution landscape has pointed to concerns about up-front commission on […]

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FSB Appeal Board Clarifies Factual Causation

The recent Appeal Board Determination in the matter of J&G Financial Service Assurance Brokers (Pty) Ltd and R L Prigge is an important Determination for a number of reasons. Mention has already been made in this publication of a number of the comments and criticisms made by the Chairman of the Appeal Board (Moonstone Investment […]

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Notes on the Insurance Bill

The Insurance Bill in its probable final form has now been published. The Bill deals essentially in prudential matters as these apply to insurers. However, there are a number of amendments to existing legislation proposed in the Bill that will be of interest to intermediaries. Fees other than commission S 8(5) of the STIA currently […]

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Important FICA Reminder for Motor Dealers

Motor dealers are reminded that if they receive a cash payment from a customer of more than R24 999,99 – and here cash means coins, banknotes or travellers cheques – that this must be reported to the Financial Intelligence Centre on each occasion. S 28(b) of the FIC Act, 2001 provides that a reporting institution must, […]

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Financial Soundness – at all times

At a recent meeting between senior officials of the FAIS Division of the FSB and a committee of industry members, Ms Lorraine van Deventer expressed the concern that many FSPs still do not fully appreciate the financial soundness requirements that were imposed in the Fit and Proper Requirements contained in Board Notice 106 of 2008. In […]

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Short-Term Insurance Premium Collection – Now and in Future

From enquiries we receive, there appears to be some confusion regarding the collection of short-term insurance premiums. This is understandable, given the various amendments to the STIA, the implementation of the Financial Sector Regulation Act, the recent amendments to the Regulations and comments made regarding certain proposals in the Retail Distribution Review Updates. Little has […]

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Legislative Instruments under the FSR Bill

In an informative assessment of the Financial Sector Regulation Bill, Alan Holton, an associate of Moonstone Compliance, wrote: “The Bill makes provision for the Prudential Authority and Financial Sector Conduct Authority to create ‘legislative instruments’. This term is defined and means subordinate legislation made in terms of a financial sector law, and includes regulations, prudential […]

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POPI and your FSP

Despite a lot of early fanfare, little mention was recently made of this important piece of legislation which is bound to impact on each FSP. This overview is, by its nature, very brief and covers very high level views only. More detailed information will be shared in our follow-up workshops once we have the final […]

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Business Continuity and Succession Planning – Part II

In Part I we discussed the close relationship between the two elements, stating that succession planning could be considered a subset of business continuity planning, and how the TCF requirements added a dimension not normally included in the definition of business continuity, namely ensuring that clients or customers are serviced if the business is terminated. […]

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