The Prudential Authority (PA) announced on Friday that it has imposed administration sanctions on Discovery Bank Limited – including a fine of R3 million – for non-compliance with the Financial Intelligence Centre Act (FICA).
The PA detected the non-compliance when it conducted an inspection in 2021. The samples assessed covered the period from 1 July 2019 to 31 May 2021.
The administrative sanctions consist of four cautions not to repeat the conduct that led to the non-compliance and a financial penalty totalling R3m, of which R1m was conditionally suspended for 36 months from 9 July 2025.
The PA said in a statement on 7 November that the sanctions stemmed from the following non-compliance:
- Late submission of suspicious activity reports
Discovery Bank failed timeously to submit 24 suspicious and unusual transaction reports or suspicious and unusual activity reports to the Financial Intelligence Centre, as required by section 29 read with section 42 of FICA and Regulation 24(3) of the FICA Regulations.
The PA cautioned the bank not to repeat the conduct that led to the non-compliance and imposed a fine of R1m, of which R500 000 was conditionally suspended for 36 months.
- Failure to provide FICA training
The bank failed to provide training as prescribed by its Risk Management and Compliance Programme (RMCP), per section 43 of FICA. Specifically, 84 out of 155 of its new employees had not received training within 30 days of being appointed; 47 out of 109 of its employees had not received annual refresher training within a year; and two out of six of its senior management had not received training within 30 days of being appointed.
The PA cautioned the bank and imposed a fine of R1m.
- Delayed attention to monitoring alerts
Discovery Bank failed timeously to attend to 2 281 of its automated transaction monitoring system alerts within the prescribed period of 48 hours, as required by Directive 5/2019.
The bank was cautioned and fined R1m, of which R500 000 was conditionally suspended for 36 months.
- Deficiencies in the RMCP
The bank failed to comply with section 42 of FICA because it did not provide evidence that it had documented the step-by-step working method/s and/or listed the trigger events that would require it bank to review its RMCP. The RMCP also did not define a “business day” for the purposes of identifying cash transactions to be reported in terms of section 28 read with section 42 of Act.
The bank was cautioned not to repeat the conduct that led to the non-compliance.
The PA said it received Discovery Bank’s co-operation in undertaking the remedial action required to address the identified compliance deficiencies and control weaknesses.
Discovery Bank said in a statement the inspection found no evidence of the bank’s being involved in or facilitating transactions related to money laundering or other illicit financial activities.
“It is also important to note that all findings raised by the PA had already been identified and remediated prior to the commencement of the inspection.”
Since the inspection period, compliance operations have been significantly strengthened, “with substantive enhancements across systems, processes, and governance structures,” Discovery Bank said.
