Capitec, Ninety-One Assurance fined R34m over Fica lapses

The Prudential Authority (PA) has imposed combined administrative penalties of R34 million on Capitec Bank and Ninety-One Assurance for failing to comply with the Financial Intelligence Centre Act (Fica).

Capitec received the larger penalty of R28 million, of which R5.5 million was conditionally suspended for 36 months, Anelitha Fandese reports for EWN.

Ninety-One Assurance was fined R6 million, with R2.5 million of the penalty similarly suspended over the same period.

The sanctions follow inspections conducted in 2023 by the PA, which operates within the administration of the South African Reserve Bank.

Both Capitec and Ninety-One Assurance co-operated with the regulator and said they had taken remedial steps to address the compliance shortcomings identified.

In Capitec’s case, the PA found that the bank had failed to adequately conduct customer due diligence, enhanced due diligence and ongoing due diligence on a sample of client files. It also found that the bank had not provided adequate ongoing training to some employees.

The regulator identified further weaknesses in Capitec’s risk-management and compliance programme, including processes for reporting suspected terrorist property and administering financial sanctions. It also found shortcomings in the bank’s screening for sanctions risks and politically influential persons.

Ninety-One Assurance’s R6 million penalty was imposed for similar non-compliance with Fica, although the specific findings against the insurer were not detailed.

Established in April 2018 under South Africa’s “Twin Peaks” model of financial regulation, the PA is mandated to promote the safety and soundness of financial institutions and ensure that they remain able to meet their obligations to customers.