found to act fraudulently or committed any other act that gives rise - - PowerPoint PPT Presentation

Consequences for representatives that have been found to act fraudulently or committed any other act that gives rise to debarment

The purpose of debarment

• Debarment means that you have been excluded from being

able to do something

• Representatives who no longer comply with the fit and

proper requirements, have to be excluded by their FSP from providing financial services.

• This means that the FSP is responsible for debarring the

Representative

• The purpose of debarment is to remove Representatives who

are no longer fit and proper or who have disobeyed the requirements or conditions of the FAIS Act, and ensure that they are prohibited by the FSP from providing any new financial services in the future.

The purpose of debarment

• The FSP must do this by:
• Withdrawing the authority of the representative

to act for and on behalf of the FSP, and

• By removing the name of the Representative

from the representative register.

• The FSP must also:
• Take immediate steps to ensure that the

debarment does not unfairly affect the interests

• f the clients, and
• Ensure that un-concluded business of the

representatives is properly concluded. Consequences for representatives that have been found to act fraudulently or committed any other act that gives rise to debarment

Debarment by the FSP

• Possible Reasons for debarment are:
• Non-compliance with any of the fit and proper

requirements

• Disobeying any of the provisions of the FAIS Act
• When the FSP debars a representative the FSP

must take into consideration any information provided by the Registrar, the Ombud and any

• ther person.

Consequences for representatives that have been found to act fraudulently or committed any other act that gives rise to debarment

Debarment by the FAIS Registrar

• The FAIS Registrar can also debar a person,

including a Representative

• The Registrar can debar a person from providing

financial services for a specific period of time if the person

• Does not meet the fit and proper requirement of

honesty and integrity, or

• Has disobeyed the provisions of the FAIS Act

NB!! The Registrar may publish the debarment or the lifting of the debarment Consequences for representatives that have been found to act fraudulently or committed any other act that gives rise to debarment

• When the Registrar wants to debar a Representative, the

Registrar must inform the Representative of the following.

• The grounds for the intention of the debarment and must

provide the Representative with a reasonable opportunity to make a submission in response, and

• Any terms to be attached to the intended period of

suspension such as:  Any terms relating to the prohibition of concluding any new business by the representative as from the effective date of the debarment, or  Terms relating to the protection of the interests of clients, and  Terms designed to facilitate the lifting of the debarment

Process of debarment for a representative when the Registrar initiates the debarment

• The Registrar must consider any response received

and may thereafter decide to debar the Representative and must notify the representative of the decision NB!! The FSP must within a period of 5 days after being informed by the registrar of the debarment, remove the names of that Representative from the register. Process of debarment for a representative when the Registrar initiates the debarment

• FSP’s need to debar Representatives before

terminating the service between the FSP and the Representative which allows the Representative to act

• f behalf of the FSP
• The FSP must first remove the Representatives name

from the register of Representatives.

• The FSP must also ensure that they comply with all the

applicable labour laws

• The Representative should be informed in writing of

the debarment and should be told the reasons for the debarment as well as the conditions for lifting it.

The process and time frame that an FSP has to adhere to when a Representative gets debarred

• It may be a condition of service that the

Representative and Key Individual of Representatives be debarred.

• If the Representative is listed as unfairly debarred

then they will have full legal recourse against the FSP for which the Key Individual will be held responsible.

• The FSP must then within 15 days of the removal of

the Representatives name from the register inform the registrar in writing of the removal. This should include the details of the reasons for debarment and must be in the prescribed format. The process and time frame that an FSP has to adhere to when a Representative gets debarred

• If a Representative is linked to more than one FSP

and FSP1 debars the Representative then FSP2 will be informed by the Registrar that the said Representative has been debarred by FSP1

• The Registrar may make known any debarment as

well as the reason for it on the official website or in any appropriate public media.

• The process also requires the FSP to take immediate

steps to ensure that clients of the Representative are not disadvantaged and that any unfinished business is properly concluded The process and time frame that an FSP has to adhere to when a Representative gets debarred

• If a representative is debarred he may be reappointed provided that

he complies with the requirements of reappointment as determined by the registrar.

• Before a debarred Representative can be reappointed he needs to

meet the following requirements

• 12 months must have past unless debarment was as a result of a

lack of competence

• All un-concluded business of the debarred Representative must

have been properly concluded.

• All complaints and legal proceedings submitted by clients to the

applicant or the debarred provider, or the Ombud or any court of law that arose due to the applicant direct or indirect involvement prior to the debarment date must have been properly and lawfully resolved or concluded and the applicant must have complied with any decisions, determinations or court order

• All fit and proper requirements must also have been met

Recourse for a representative after debarment