In terms of Regulation 24 a report made under section 29 of FIC Act must be sent to the Centre as soon as possible but not later than fifteen days, excluding Saturdays, Sundays and public holidays, after a natural person or any of his or her employees, or any of the employees or officers of a legal person or other entity, has become aware of a fact concerning a transaction on the basis of which knowledge or a suspicion concerning the transaction must be reported. In exceptional cases the Centre may approve of the report being sent after the expiry of this period.
The general rule is that a person may continue with a transaction from which a report emanates. However, section 34 of the FIC Act empowers the Centre to intervene in certain transactions after consulting with an accountable institution, reporting institution or person required to make a report. In such instances the accountable institution, reporting institution or person in question may not proceed with the carrying out of the transaction. The Centre’s intervention is valid for a maximum period of 5 days and is aimed at creating an opportunity for the Centre to make the necessary enquiries and to inform and advise an investigating authority.
Section 38 of the FIC Act provides for a broad range of measures to protect persons who participate in submitting reports to the Centre. It guarantees that “no action, whether criminal or civil, can be instituted against any natural or legal person who complies in good faith with the reporting obligations of the FIC Act”. Consequently, they cannot even be forced to give evidence concerning such a report in criminal proceedings arising from the report. However such a person may choose to do so voluntarily. If a person who participated in submitting a report to the Centre elects not to testify, no evidence regarding that person’s identity is admissible as evidence in criminal proceedings
The Centre was established by the provisions of the FIC Act with the principal objective to assist in the identification of the proceeds of unlawful activities and the combating of money laundering activities and the financing of terrorist and related activities. The FIC Act thus places various obligations on defined institutions (referred to as accountable institutions and reporting institutions) to assist in fulfilling this objective.
Section 43B of the FIC Act, requires accountable institutions and reporting institutions to be registered with the Centre. Such registration includes providing the Centre with the details of the compliance officer and the institution’s information. The initial registration period commenced on 01 December 2011 and all accountable and reporting institutions were required to be registered prior to 01 March 2011.
Persons who commence new businesses which are regarded as accountable or reporting institutions are required to register with the Centre within 90 days from the date the business commenced.
The cash threshold reporting obligation and the registration obligation should not be confused. Registering with the Centre is a legal obligation as explained above, and even though you may not receive cash you are still required to register as an accountable or reporting institution.
In terms of Section 61A of the FIC Act a failure to register is an offence and subject to a fine not exceeding R10 million or imprisonment for a period of up to 5 years.
Alternatively, the Centre may also, in terms of section 45C (1) of the FIC Act, impose an administrative sanction for a failure to comply with any provision of the FIC Act, including a failure to register.
It is a legal requirement that registration must be done electronically and only in exceptional cases will manual registrations be permitted. Exceptions will only be allowed in instances where the AI or RI does not have the technological capacity concerning e-mail and internet access. If you require a manual form contact the Centre for a copy of the form.
Accountable institutions and reporting institutions must register only once with the Centre. Each individual AI or RI within a complex structure or group needs to register with the Centre.
All entities that are included in the description of accountable institutions in Schedule 1 or reporting institutions in Schedule 3 of the FIC Act are required to register.
Although some of the long-term insurance products have been exempted from the requirements to conduct customer identification and verification and to keep record of such information, every accountable institution referred to in Schedule 1 and every reporting institution referred to in Schedule 3 must register with the Centre within the prescribed period and in the prescribed manner as stipulated in section 43B of the FIC Act.