FICA - Financial Intelligence Centre Act

Seizing the proceeds of crime and making money laundering a criminal offence has become an integral part of the fight against organised crime. Internationally, governments have introduced legislation to this effect. In South Africa, Money Laundering too has been criminalised in section 4 of the Prevention of Organised Crime Act, 1998.

The Financial Intelligence Centre Act sets up, among other things, a regulatory anti-money laundering regime which is intended to break the cycle used by organised criminal groups to benefit from illicit profits. By doing so the Act aims to maintain the integrity of South Africa's financial system. As well as the regulatory regime the Act also creates the Financial Intelligence Centre. (The Financial Intelligence Centre was established under the Financial Intelligence Centre Act, 2001, in February 2002). The Centre started receiving reports on suspicious and unusual transactions on 3 February 2003.

In line with this legislation all banks and other financial services providers are required to introduce more stringent processes for the opening of new accounts, taking up of loans, etc.

Effectively this means that any institution in order to comply with FICA will require consumers to provide them with additional proof of identity when opening a new bank account, etc. This law also requires that the consumer's personal information should be updated regularly. The Act thus imposes a 'know your client', and record-keeping and reporting obligations on accountable institutions.

Therefore, when in dealing with any financial services providers, consumers will have to supply documents that verify their identity. The information and documents required vary depending on whether they are acting in a personal or business capacity and the type of product they are interested in. For consumer banking these documents will usually include a green bar-coded ID book or valid passport (if foreign national), proof of residential address, bank statements, salary slips, etc

For more on the Financial Intelligence Centre Act, please click here http://www.fic.gov.za/

For more on the requirements to comply with FICA please contact your bank.