South Africa Financial Sector Conduct Authority imposes ZAR 710,000 penalty on QuickTrade for Financial Intelligence Centre Act compliance failures

The South Africa Financial Sector Conduct Authority (FSCA) imposed an administrative penalty of ZAR 710,000 on QuickTrade (Pty) Ltd, a licensed financial services provider and accountable institution, for non-compliance with the Financial Intelligence Centre Act (FIC Act) covering anti-money laundering controls, customer due diligence and cash threshold reporting. The sanction followed an inspection conducted under section 45B of the FIC Act, and the FSCA also issued a directive requiring remediation of the identified deficiencies. The inspection found QuickTrade’s Risk Management and Compliance Programme required by sections 42(1) and 42(2) was deficient because it did not set out how the firm would meet key requirements, including assessing and managing money laundering, terrorist financing and proliferation financing risks, verifying client identities, applying additional or enhanced due diligence and scrutinising unusual transactions. Breaches were also identified under sections 21(1), 21A and 21B due to failures to conduct customer due diligence, including not establishing and verifying client identities, not obtaining source-of-funds information and not collecting information on the nature of business and ownership/control structures. In addition, QuickTrade failed to submit several cash threshold reports under section 28 for aggregated cash deposits that exceeded the then-applicable reporting threshold of ZAR 24,999.99, noting that the cash threshold reporting regime was revised from 14 November 2022 with the threshold increased to above ZAR 49,999.99 and aggregation reporting no longer required. The FSCA noted QuickTrade’s commitment to strengthen its AML/CTF/CPF framework and warned that non-compliance with the FIC Act will result in regulatory action.