A financial adviser has been fined R40 000 and an advice firm R20 000 by the enforcement committee of the Financial Services Board (FSB) for offering financial services without the required authorisation.
The Registrar of Financial Services Providers referred a case against Tendai Nyadombo to the enforcement committee after finding that he had contravened section 7(1) of the Financial Advisory and Intermediary Services (FAIS) Act. Between 2014 and April 2016 Nyadombo acted as a financial services provider in respect of several categories of long-term insurance and of retail pension benefits without the required licence to offer these services.
As aggravating factors, the registrar considered, among other things, that the contravention took place over two years and Nyadombo’s conduct potentially prejudiced clients. In mitigation, the registrar took into account that Nyadombo accepted responsibility for the contravention and co-operated with the registrar’s investigation and the subsequent enforcement action.
The second case was against Mzala and Company, which rendered financial services to clients in respect of long-term insurance and collective investment scheme products while unauthorised by the FSB to do so.
The parties agreed on a penalty of R20 000. The registrar took into account that Mzala and Company expressed regret for its actions, admitted the contravention and co-operated fully during the entire process.