FSCA's Felicity Mabaso told the PIC Commission of Inquiry that the FSCA was informed that there were no mandate breaches in what is now known as the AYO transaction. Photo: Oupa Mokoena/African News Agency (ANA)

PRETORIA – The Financial Sector Conduct Authority (FSCA) never received any irregularity report with regard to the Public Investment Corporation’s (PIC’s) investment into AYO Technology Solutions.

This was revealed by the divisional executive for licensing and the business centre at the Financial Sector Conduct Authority (FSCA), Felicity Mabaso, during her submission to the PIC Commission of Inquiry, which resumed on Monday.

Mabaso told the Commission that the FSCA was informed that there were no mandate breaches in what is now known as the AYO transaction. 

She, however, said: “We will follow up from our side as we are following these proceedings, and are noting the submissions being made by the witnesses so we can make an informed decision.”

Mabaso also told the Commission that the Financial Services Board (FSB) in May 2017 received a letter from the Organisation Undoing Tax Abuse (Outa) dealing with the investment of funds by financial services providers into maladministered state-owned entities. 

“Although not a specific complaint about the PIC, the letter demanded of the FSB/Registrar to ‘as a matter of urgency, declare such investments, in Eskom by financial service providers, be they the PIC or any other provider, public or private, to be an undesirable practice in terms of section 34’ of the FAIS Act. 

“The FSB subsequently sought and obtained advice from senior counsel about the provision of section 34 of the FAIS Act within the ambit of the regulatory framework and inter alia the requirement for FSPs to comply with the provisions of the Code of Conduct,” she said during her submission.

Mabaso said the Registrar decided not to declare investments in state-owned entities an undesirable business practice. 

She also told the Commission that in August 2018 correspondence was received from Abraham du Plooy who essentially commented on the President’s decision to establish a commission of enquiry into the PIC. 

“The correspondence was not specific on any issue and a request for additional information did not elicit such information,” said Mabaso. 

The FSCA was, therefore, unable to investigate the matter.