FICA (The Financial Intelligence Centre Act) No 38 of 2000.

Purpose

The aim is to identify suspicious transactions so that people who engage in money laundering activities can consequently be charged under POCA.

Suspicious transactions must be reported under FICA, that will also provide the infrastructure to curb money laundering activities.

The Act also requires “Accountable Institutions” that could serve as a pipeline for “dirty money” to comply with certain legal duties relating to combat money laundering.

Accountable Institutions

Accountable businesses themselves are not necessarily statutory bodies but include people and business that can be used for money laundering purposes.

 

The list of accountable institutions define in FICA includes the following:

• Banks
• Estate Agents
• Attorneys
• Trust companies
• Collective Investment Schemes
• Long Term Insurance companies

FICA provides for a Financial Intelligence Centre (FIC) lending its name to the Act and a money laundering Advisory Council to help combat money laundering.

The following legal obligations are imposed by FICA upon accountable institutions:

 Identify and verify clients

 Record keeping requirements

 Reporting Requirements

 Formulate and implement a set of internal rules

 Appoint a money laundering reporting officer

 Training requirements

A KEY REQUIREMENT OF MONEY LAUNDERING REGULATIONS IS THAT NOT EVEN ONE SINGLE TRANSACTION MAY BE CONCLUDED UNLESS CERTAIN ESTABLISHED STEPS HAVE BEEN TAKEN TO IDENTIFY AND VERIFY THE CLIENT OR THE INTERMEDIA

FIC (Financial Intelligence Centre)

Purpose

They provide high quality and timely financial intelligence to help South African authorities fight against crime, money laundering and terrorist financing.

Objective

• To assist in the identification of unlawful activities and therefore combating money laundering activities.
• These institutions are therefore required by the Act to report, all information in regard to money laundering activities to the FIC. It is then handed over to the appropriate authorities and as a result to further the recourse.
• To make information collected by them available to investigating authorities. The intelligence service and SARS can then facilitate the administration and enforcement of the Laws of South Africa.
• To exchange information with similar bodies in other countries because of money laundering activities and similar offences.

Money Laundering Advisory Council

Section 17 of FICA establishes the Money Laundering Advisory Council, an advisory body on fighting money laundering.

 Purpose

• The Money Laundering Advisory Council advises the Minister of Finance on policies and best practices therefore fighting money laundering. Furthermore, it also identifies the proceeds of unlawful activities.
• The Council acts as a forum and in addition to association representing categories of accountable institutions and supervisory bodies it can report to FIC to consult with each another.
• Finally, the Council should advise the FIC on the performance of its functions.