Estate Agency board probing Pam Golding Properties for alleged financial contraventions
Johannesburg – The Estate Agency Affairs Board of South Africa (EAAB) is launching a full-scale investigation into allegations that one of South Africa’s top estate agencies contravened financial regulatory laws when facilitating the sale of property to "politically exposed people", the board said on Sunday.
"Pam Golding Properties will be the subject of a multi-pronged investigation following reports that it allegedly facilitated the sale of properties to the children of former Mozambican president Armando Guebuza without following legal requirements and thus allegedly aided money laundering," the EAAB said in a statement.
The two properties involved, in Dainfern and Kyalami Estate north of Johannesburg, were believed to be worth a combined R50 million.
In a first-of-its kind investigation, the EAAB had requested a joint probe with the Financial Intelligence Centre (FIC) into the allegations carried in a February 21, 2020 article in the Mail & Guardian newspaper.
"It is alleged that former political leaders and their families were laundering money by investing large sums of illegal monies in properties in South Africa, resulting in the artificial inflation of property prices and skewed market values," the statement said.
EAAB CEO Mamodupi Mohlala said the allegations were of a serious nature and that senior officials from the regulator would lead the probe.
“Enforcement and compliance are at the core of our mandate as a regulator. We therefore have to ensure that there is full compliance, no matter how big or small a licensee.
"We demand full compliance in the interests of consumer and public protection,” Mohlala said.
The EAAB, as the supervisory board of the property industry, would meet the FIC in the coming days to finalise the scope of the investigation which would look into whether Pam Golding Properties transgressed sections of the FIC Act. These included:
* Section 21B which required determining the identity of a client;
* Section 27A - money laundering and terrorist financial control regulations;
* Section 28 – cash threshold;
* Section 29 – suspicious and unusual transaction;
* Section 31 – cross-border electronic transfer; and
* Section 42A, which required a company and its employees to ensure compliance with a risk management and compliance programme (RMCP).
Mohlala said the investigation would involve officials doing on-site inspections at Pam Golding Properties’ premises and requesting access to documents.
Any adverse findings would result in the agency being hauled before an EAAB disciplinary hearing. The final findings would determine a possible sanction, which could include a substantial fine.
“We will expedite the investigation and request co-operation from all parties involved. The allegations against Pam Golding’s conduct is most concerning.
"We are aware that the property sector, more especially the real estate sector, is a source of wealth creation. We, however, say create wealth legally and according to rules and policies.
"We therefore intend on using legislative tools to ensure compliance by all players, including Pam Golding, which is one of the biggest players in our space. No one is above the law," Mohlala said.