What is FICA?

The Financial Intelligence Centre Act (FICA) came into effect on 1 July 2003 and was updated in 2017 by the FICA Amendment Act.

FICA was introduced to fight financial crime, such as money laundering, tax evasion, and terrorist financing activities by making it more difficult for criminals to benefit from the proceeds of crime. The Amendment brings South Africa closer to international standards and the best practices recommended by the Financial Action Task Force (FATF).

The key obligations in terms of FICA include:

• To establish and verify the identity clients;

• To screen clients against appropriate sanctions lists;

• To keep records of business relationships and transactions;

• To undertake ongoing due diligence of relationships;

• To report receipts of cash above a prescribed amount to the Financial Intelligence Centre;

• To report suspicious transactions/activities to the Financial Intelligence Centre;

• To implement internal risk control/mitigation processes consistent with obligations under FICA;

• To document controls in a Risk Management & Compliance Plan (RMCP)

• To offer compulsory FICA training to all our employees; and

• To appoint a compliance officer.

It is a legal requirement for accountable institutions to comply with FICA in order to deter financial crimes and it is a criminal offence for them not to do so.