“Busy, busy, busy” – that’s the regulators as we close out the year. We are already drawing up the “To do” list for 2026!
FINANCIAL INTELLIGENCE CENTRE (FIC)
South Africa removed from FATF grey list: A milestone in financial crime reform
The FIC has announced South Africa’s removal from the Financial Action Task Force (FATF) grey list, marking a significant achievement in the country’s efforts to combat financial crime. This decision follows 32 months of intensive reform since South Africa was placed under increased monitoring in February 2023.
The exit reflects a coordinated national response to address deficiencies identified in the 2019 mutual evaluation.
Notably, the FIC reported:
- 5 million in suspected criminal proceeds frozen.
- 9 million recovered using financial intelligence.
FIC Acting Director Pieter Smit emphasised that while exiting the grey list is a major milestone, it is “only half the battle won”. South Africa is now preparing for its fifth round of mutual evaluations, scheduled for 2026–2027.
Annual Report 2024/25
The FIC reports that it met or exceeded most of its performance targets for the year ended 31 March 2025, despite capacity and funding challenges. The FIC played a central role in South Africa’s progress towards meeting the FATF requirements, addressing 20 of 22 action items by year-end and all items substantially completed by June 2025, paving the way for possible removal from the FATF grey list.
Operationally, the FIC produced more than 4,100 financial intelligence reports and 51 reports on illicit financial flows, contributing to the recovery of approximately R144 million in criminal proceeds. It also led multi-agency initiatives, including the Reformed Fusion Centre and Asset Recovery Hub, which together facilitated the recovery of more than R140 million.
The Centre expanded its supervisory scope to include designated non-financial businesses, credit providers and CASPs, overseeing compliance from more than 55,000 registered institutions that submitted 13.5 million regulatory reports. Notably, Directive 9 introduced requirements for crypto asset transfers aligned with global standards.
Internally, the FIC increased its workforce to 275 employees, enhanced technology capacity with artificial intelligence tools, and maintained an unqualified audit outcome. Employment equity targets were exceeded, with nearly 85% of staff from designated race groups and 62% female.
The FIC aims to strengthen its supervisory role, continue modernising its technology, and support South Africa’s preparation for the next FATF mutual evaluation in 2026–2027.
THE FINANCIAL SECTOR CONDUCT AUTHORITY (FSCA)
FSCA draft for OMNI-Risk Return reporting
The FSCA is implementing a new supervisory data collection approach through the OMNI-Risk Return, which forms a key part of its Integrated Regulatory Solution (IRS). This system aims to harmonise and automate the supervisory risk model across all financial institutions to provide a consolidated, consistent risk profile per institution, replacing the previous fragmented sectoral risk assessments.
The FSCA has shared a draft Excel template titled “Annexure A Draft OMNI-Risk Return template.xlsx” as part of its ongoing efforts to enhance regulatory oversight and risk management in the financial services industry. This comprehensive tool is designed to standardise reporting for financial institutions, focusing on conduct risk, AML/CFT compliance, and operational integrity.
Tailored for entities supervised by the FSCA under frameworks like the FSR Act and FIC Act, the template emphasises accurate, timely disclosures.
Key features and sections
The OMNI-Risk Return covers 12 broad risk sections covering the following areas:
- Group structure, ownership, and inter-group transactions.
- Geographical presence, including jurisdictions and business premises.
- Governance metrics, like board diversity, remuneration, and non-compliance incidents.
- Customer base details, including entity types, politically exposed persons, and high-risk jurisdictions.
- Asset handling, collections, allocations, and unclaimed assets.
- Transaction volumes by distribution channels and intermediary composition.
- Product terminations, withdrawals, and trade cancellations.
- Advertising channels, expenditures, and customer communications.
- Complaints management, resolution times, and Ombud outcomes.
- IT governance, data accuracy, system downtime, and breaches.
- Outsourcing, vacancies, and training expenditures.
- Financial data, including revenue, expenditure, and funding structures.
Implications for the industry
The draft aims to streamline risk assessments, enabling the FSCA to identify vulnerabilities. Metrics such as unclaimed assets by duration, system incidents, and Ombud rulings with provisions for high-risk scenarios (e.g. grey/black-listed countries) may be required. Submissions will require precise inputs, with some sections optional for non-applicable entities such as non-Accountable Institutions.
The FSCA is conducting stakeholder consultation until 30 November 2025, including webinars and workshops, encouraging feedback to ensure feasibility and readiness among financial institutions. Should you not want to attend but still submit feedback, you can do so here and not through the usual email systems.
Integrated report 2024/25
The FSCA released its 2024/25 Integrated Report, marking the close of its 2020–2025 strategic cycle. The FSCA delivered strong regulatory and operational outcomes, achieving 89% of its performance targets.
Key highlights
- Regulatory strengthening: More than 80% of the rolling three-year Regulation Plan was implemented, with new conduct standards and guidance enhancing market integrity. Preparations for the Conduct of Financial Institutions Bill advanced significantly.
- Digital transformation: The FSCA launched Phase 1 of its IRS, introduced Identity and Access Management, automated 50% of client-facing processes, and rolled out four business intelligence dashboards.
- Supervisory and enforcement role: The FSCA strengthened its risk-based supervision, especially in AML/CFT compliance as part of South Africa’s FATF greylisting exit efforts. Enforcement actions and penalties underscored its commitment to consumer protection.
Challenges
High volumes of retirement fund applications, unclaimed benefits, and transformation scorecard impasses remain ongoing concerns.
Looking ahead
The FSCA will advance its sustainability strategy, embed environmental, social, and governance practices, expand digital capabilities, and continue strengthening financial literacy and inclusion to ensure a resilient, fair, and innovative financial sector.
FSCA releases proposed amendments to financial sector levies
The FSCA has published its 2025/26 levy proposals.
Most base and variable levy components reflect a uniform 4% increase across entities, aligning with inflation and operational cost adjustments.
Entity-specific adjustments:
- The base levy for banks has increased to R57,876 with a variable rate of 0.001909% of total liabilities.
- Life and non-life insurers have separate levies based on gross written premiums and technical provisions.
- Levy calculations for pension funds now factor in member counts and fund types, with differentiated treatment for preservation and annuity funds.
- As previously for financial services providers, variable components are tied to the number of representatives and assets under management, with special provisions for multi-category authorisations.
- New classifications have been introduced for external entities such as foreign benchmark administrators, external trade repositories, and external credit rating agencies.
- Clearing houses licensed as central counterparties will only pay the central counterparty levy, avoiding duplication.
FSCA information request for Crypto Asset Service Providers (CASPs)
The FSCA has released a Request for Information (RFI) aimed at all CASPs operating in South Africa.
The RFI seeks to collect data on the scope, nature, and risks of crypto-related financial services. Information gathered will inform the FSCA’s regulatory approach and enhance understanding of the crypto ecosystem’s dynamics, risk exposures, and consumer interactions.
The questionnaire covers:
- Business activities: Advisory, discretionary, exchange, custodial, payment, tokenisation, and index-based services.
- Licensing and operations: Domestic and cross-border activities, market size, and revenue segmentation.
- Risk management: Frameworks for market, cyber, liquidity, and conduct risks, plus insurance arrangements.
- AML/CFT compliance: Registration with the FIC, travel rule implementation, and blockchain analytics usage.
- Stablecoins: Services offered, reserve verification, key risks, and potential for rand-backed stablecoins.
- Consumer protection: Suitability assessments, complaint management, and marketing disclosure practices.
- Outsourcing and governance: Oversight of third-party service providers and technology functions.
This RFI follows the FSCA’s ongoing rollout of the crypto asset licensing regime under FAIS and its alignment with FATF recommendations. It signals heightened regulatory attention to conduct risk, financial crime compliance, and consumer protection within the crypto sector.
CASPs must complete the questionnaire via the online form provided (not the PDF itself) and submit responses directly to the FSCA fintech division at fintech@fsca.co.za.
Sanlam Collective Investments fined R10.6 million for FIC Act breaches
An administrative penalty of R10.6 million was imposed on Sanlam Collective Investments (RF) (Pty) Ltd (SCI) for non-compliance with key provisions of the Financial Intelligence Centre Act (FIC Act).
The FSCA found SCI’s Risk Management and Compliance Programme to be ineffective and technically deficient – particularly in relation to client risk rating, enhanced due diligence on partnerships, transaction monitoring, and reporting of suspicious activities. SCI also failed to adequately identify and verify certain clients and beneficial owners and did not conduct required ongoing or enhanced due diligence.
The FSCA highlighted that SCI’s previous compliance breaches and enforceable undertakings influenced the severity of the sanction. However, in recognition of remedial steps taken, R3.6 million of the fine has been suspended for two years, conditional on full remediation and sustained compliance.
The regulator emphasised the seriousness of the contraventions given SCI’s market position and reiterated that robust anti-money laundering and counter-terrorism controls are critical to maintaining financial system integrity. The FSCA cautioned all accountable institutions to regularly review and strengthen their AML/CFT frameworks to avoid similar sanctions.
FSCA warnings
Here is the usual list of warnings about entities scamming investors and trading illegally:
Michael Jacobs and AMFX Solutions are soliciting funds from the public for investment purposes, promising unrealistic returns, and neither entity is registered as a financial services provider.
Lucas Sekhorane Maake, who also operates as Skuriey.rsa on Telegram, is offering forex signals and account management services to the public. However, he is not authorised to provide financial services.
Dazzle Brilliance Diamond (Pty) Ltd is soliciting funds from the public for investment purposes, promising unrealistic returns, but is not authorised to provide financial services.
A Telegram group is falsely claiming to be associated with Six Swiss Exchange and Wings Financial Services CC to solicit investments from the public.
PRUDENTIAL AUTHORITY (PA)
Updated guidance on climate-related disclosures for banks
The PA released Guidance Note 3 of 2025, setting out updated expectations for how banks should disclose climate-related financial risks and opportunities. The Guidance Note brings local disclosure practices into alignment with the Basel Committee on Banking Supervision framework and the IFRS Climate Disclosure Standards, replacing Guidance Note 3 of 2024.
The objectives are to promote transparency and comparability in how banks assess and report climate risks, as well as to encourage banks to integrate climate risk identification, management, and disclosure into existing governance and risk frameworks.
The Guidance Note requires boards to disclose oversight structures, competencies, and processes for managing climate risks, and to explain how climate risks affect their business model, financial performance, and future plans.
Institutions must describe how they identify, assess, and monitor climate-related physical, transition, and concentration risks, which include disclosures on financed emissions, sectoral exposures, geographical vulnerability, and energy efficiency in real-estate portfolios.
The guidance emphasises South Africa’s exposure to risks such as droughts, floods, and wildfires, as well as the transition risks due to dependence on fossil fuels. It calls on banks to build the capacity to address these vulnerabilities.
Climate-related disclosures are voluntary for now, but are expected to become compulsory over time.
External assurance is not yet required, though banks should apply the same internal controls as those used for financial reporting.
Banks are encouraged to adopt South Africa’s Green Finance Taxonomy when establishing sustainability-linked targets.
Banks must share the Guidance Note and the Annexure with their auditors, and the chief executive must return a signed acknowledgement of receipt to the PA.
NATIONAL TREASURY (NT)
Annual Report 2024/25
The National Treasury Annual Report for 2024/25 presents a comprehensive overview of the department’s performance and achievements, aligned with its mandate to promote sound fiscal, economic, and financial management in South Africa.
Key highlights include:
- Structural reorganisation of the Treasury with 10 branches to improve efficiency, including new offices of the General Counsel and Economic Policy and International Cooperation.
- Tax policy reforms delivered through the 2024 Budget, generating R15 billion in additional revenue and implementing the two-pot retirement system and the Global Minimum Tax Act.
- Sound fiscal management with government debt at R5.6 trillion and a primary budget surplus achieved amid challenging economic conditions.
- Improved management of state-owned entities with oversight of guarantees and financial stability measures.
- Enhanced public financial management via capacity-building programmes, improved supply chain management reforms, and the rollout of an organisational performance monitoring system.
- Support and oversight of provincial and local government finances, including conditional grant management, financial management reforms, and capacity-building in municipalities.
- Advancements in public procurement through the new Public Procurement Act and strategic procurement framework, fostering transparency and efficiency.
- Active international engagement, including South Africa’s G20 presidency with a focus on emerging markets and development challenges, participation in African and global financial institutions, and climate finance negotiations.
- Robust pension management with all benefits paid within liability targets and a reduction in fraudulent claims.
- Financial statements show a substantial revenue base with controlled expenditures, with underspending attributed to timing or project delays being managed prudently.
Updated guidance on climate-related disclosures for insurers
It’s not quite a carbon (ahem! Ed.) copy of that issued to banks, but an updated Guidance Note (also 3 of 2025) on climate-related disclosures was issued to insurers.
The notice replaces the 2024 version and is aligned with international standards, including the International Association of Insurance Supervisors application paper and IFRS Climate Disclosure Standards.
The objectives are to promote market discipline through consistent, comparable climate disclosures, and to encourage insurers to integrate climate risk into governance, strategy, and risk management.
Insurers must detail the board and management roles in climate oversight, as well as the integration of climate risks into strategic decisions.
Insurers are expected to disclose the impacts of climate risks on business models and financial planning, scenario analyses, resilience strategies, as well as the integration of climate risks into enterprise risk management.
External assurance is not yet mandatory, but internal controls are required. Disclosures will become compulsory over time.
COUNCIL FOR MEDICAL SCHEMES (CMS)
Annual Report 2024/25
The CMS released its 2024/25 Annual Report. The CMS achieved an overall organisational performance score of 96.43%, underscoring its effectiveness in delivering on its regulatory and public protection mandate.
Key industry statistics
- Beneficiaries: 9.13 million
- Registered schemes: 71 (16 open, 55 restricted)
- Administrators: 33 | Managed Care Organisations: 43
- Accredited brokers: 7,773 | Brokerages: 2,223
- Solvency ratio: 43.45% (well above the 25% minimum requirement)
Financial overview
The CMS operated on a R259 million budget, largely funded through principal member levies (78%). It maintained financial stability and secured another unqualified audit opinion, affirming sound governance and compliance.
Strategic priorities and developments
- National Health Insurance (NHI): CMS continues to position itself as a key regulatory partner in the evolving NHI environment.
- Prescribed Minimum Benefits (PMB) Review: Ongoing work with the Department of Health aims to introduce a modernised, prevention-focused Primary Healthcare (PHC) package.
- Fraud, Waste, and Abuse (FWA): Renewal of the FWA Charter and Codes of Good Practice remains central to promoting integrity and fairness in healthcare funding.
- Demarcation and Low-Cost Benefit Options (LCBO): A two-year extension of the Exemption Framework (to March 2027) was granted while the LCBO policy undergoes public consultation.
- Digital transformation: Efforts to improve real-time data collection and reporting are underway to enhance regulatory oversight and evidence-based policymaking.
- Value-based healthcare: The CMS is encouraging the industry’s shift from fee-for-service to outcome-based care to improve affordability and quality.
A-PROOFED
Dear gentle reader,
As the moon rises and the shadows lengthen this All Hallows’ Eve, one might imagine the only fright lies in pumpkins and cobwebs. Yet, permit me to whisper a caution of a different sort. The true horrors often lurk not in haunted houses, but in your very documents.
Picture, if you will, a seemingly innocuous insurance policy. One word astray, a sentence tumbling into ambiguity, a number misplaced like a ghost in the margins. What begins as a humble communication may soon become confusion, complaints, and mild scandal. Indeed, such errors can haunt your reputation far more persistently than any spectral apparition.
And then, dear gentle reader, there are the little horrors that hide in plain sight, the ones that make you shiver when you spot them too late. Perhaps it is a number that doesn’t quite add up, quietly mocking your careful calculations. Or a pronoun that wanders without a referent, leaving the poor reader asking, “Who, pray tell, is this?” A word appears twice in a sentence as if it has taken a ghostly twin for a walk, while somewhere else a heading promises one thing and the text quietly delivers another. These are the phantoms that haunt a document, unassuming, yet capable of creating confusion, complaint, or an embarrassing pause when someone reads it aloud in a meeting.
Many a busy professional fancies that proofreading is a frivolous indulgence. “Who has time for such trifles?” they muse. But let me assure you, dear reader, the perils of neglect are manifold. Ambiguous instructions, muddled client letters, or misplaced punctuation may summon the spirits of endless clarification emails. One does not wish to be pursued by such spectres at 17:30 on a Friday afternoon, when one’s attention ought to be upon more agreeable matters.
It is here that I offer my services, not as a mere mortal proofreader, but as a vigilant guardian against textual terrors. I examine every line, every comma, every choice of word, ensuring the message you intend is precisely what your client shall receive. In doing so, I spare your team the travail of deciphering missteps conjured by haste or inattention.
Consider the benefits, gentle reader. Clear, accurate, and polished documents foster trust, diminish complaints, and reflect the utmost propriety upon your establishment. In contrast, errors, however minute, may give rise to disquiet, much like a sudden draft rattling the windows on a chilly October night.
Employing a discerning eye ensures that your communication remains unblemished by frightful misunderstandings. Policies, letters, brochures, or regulatory filings shall all proceed in elegance and clarity.
So as you light your candles and nibble your sugar-laden confections this evening, consider whether your documents are free from spectral mischief. Should you wish for peace of mind and a firm hand to banish these lurking terrors, I stand ready to assist.
Dear gentle reader, if you wish to banish those little gremlins hiding in your documents, summon me, and together we’ll exorcise every error and make sure your communication is spellbindingly clear.
Kim Hatchuel
083 657 3377 | kim@a-proofed.co.za
www.a-proofed.co.za
