Moonstone Monitor: Am I my Business's Keeper?

The future status of compliance monitoring will change significantly from what we currently have in place. One important area is the competence of the compliance officer.

Sole proprietors are not obliged to appoint a compliance officer (CO). All other business entities have the choice of appointing an internal or external compliance officer, subject to certain criteria.

Readers who are sole proprietors regularly ask us whether they are required to submit the annual FSB return, seeing that they are not compelled to have a compliance officer. The answer is of course that every licensed FSP has to submit this return, and failure to do so can lead to the suspension or withdrawal of its license.

Many an FSP who enroll to attend our annual workshops also enquires about outstanding returns. We do assist them at a fixed hourly rate, either telephonically or through one of our compliance officers in their area.

The deadline for the submission of these returns by sole proprietors is the end of February 2009. Those with a CO have passed their “submit-by” date and have hopefully done so successfully (electronically).

In the past, the following people were allowed to be appointed as the internal CO of an FSP: a director, member, auditor, trustee, principal officer, public officer or company secretary.

From 1 November 2008 this no longer applies. All COs have to comply with the same minimum requirements in respect of qualifications and experience.

An FSP who made use of an internal compliance officer prior to the above date, and who made use of the exemption in terms of the qualification and experience criteria that apply to external compliance officers, now have 18 months in which to qualify. Failure to do so will lead to the termination of the appointment of the CO, forcing the FSP to appoint an external CO if a suitable candidate is unavailable within the FSP.

The distinction that was drawn between an internal and external CO no longer exists - they all have to comply with the required qualifications and experience criteria.

If you have any questions regarding the above, please feel free to speak to Cobus Gresse or Michelle Rabie at 021 883 8000.