Capitec and Ninety One FICA fines have been confirmed by two South African financial regulators, with penalties totalling more than R59 million imposed after separate inspections into client due diligence failures.
The Prudential Authority, a supervisory arm of the South African Reserve Bank, fined Capitec Bank R56.25 million, as reported by Moneyweb. The Financial Sector Conduct Authority separately fined Ninety One Fund Managers R3 million for breaching the same legislation.
Why the Capitec and Ninety One FICA fines were issued
The Financial Intelligence Centre Act, known as FICA, is the primary law governing how South African institutions guard against money laundering and terrorism financing.
It obliges accountable institutions to identify and verify their clients, understand the purpose of an account, and monitor activity for the life of the relationship.
The Prudential Authority found that Capitec had failed to adequately conduct customer due diligence, enhanced due diligence and ongoing due diligence on sampled client files.
The findings followed inspections of the bank’s retail banking segment in 2021 and its business banking segment in 2022.
What customer due diligence requires
Customer due diligence is the process of establishing who a client is and where their money comes from. Enhanced due diligence applies to higher-risk clients, such as those with political exposure, while ongoing due diligence requires an institution to keep testing that picture as a relationship develops.
The Ninety One penalty followed an inspection carried out by the conduct authority under section 45B of FICA, which empowers supervisory bodies to examine whether an institution is meeting its obligations.
The regulator cited failures in client due diligence and risk management.
That matter was settled rather than contested, and the settlement was confirmed by an order of the Appeal Board under section 45D(7) of FICA. Settlements of this kind conclude the administrative process without the matter proceeding to a contested hearing.
What the FICA fines signal for financial institutions
Administrative penalties under FICA are not criminal sanctions and do not amount to a finding that money laundering occurred. They address whether the controls an institution is legally required to maintain were adequate, which is why regulators publish them as compliance failures rather than charges.
Both penalties originated in regulator-led inspections rather than client complaints, meaning the assessment rested on the institutions’ own records. Scrutiny of anti-money laundering controls in South Africa’s financial sector has intensified in recent years, and inspection findings are increasingly the mechanism through which lapses surface.
The immediate question is whether either institution is required to remediate the specific failures identified, since administrative penalties under FICA sit alongside directives to correct the underlying controls.
Neither regulator has announced further supervisory action arising from the same inspection cycles.
