The Financial Services Conduct Authority (FSCA) or old FSB provided clarity in terms of its view on any personal assistant or administrative employee who performs any activity relating to financial services, also known as intermediary services as per the definition in the FAIS Act on behalf of a representative (Rep) or Key Individual (KI).
The section pertaining to the appointment of representatives in the new fit and proper requirements refer.
With the increased volume of administrative duties and paperwork following the ever-increasing legislative and regulatory requirements, many Reps and KI’s started relying more and more on their personal assistants and administrative staff.
The staff perform office administration (Intermediation) services on behalf of the Rep or the KI, without considering whether such administrative duties were intermediary services.
According to the FAIS acts, an intermediary service is performed by the personal assistants/administrative employees who assist clients in any of the following aspects:
- Receiving, submitting or processing claims on behalf of the client.
- Completing forms on behalf of the client.
- Adding or removing items from a short-term medical or long-term insurance policy or investment.
- Adding or removing benefits from an insurance policy, medical insurance, medical scheme or investment.
- Collecting premiums from a client in respect of a financial product.
- With any service performed by the assistant or administrative staff on the instruction of a client to buy, sell, deal, invest or disinvest in, replace or vary a financial product.
All personal assistants and or administrative staff who perform any of the above duties must be registered as a representative at the FSCA for rendering intermediary services only.
Compliance officers or the KI will need to register the staff on the FSCA’s register from 1 April 2018, provided that they have received all the required documentation in terms of FICA and FAIS.
The practical implication could be as follows:
Any person appointed as a representative (whether for advice, intermediary services or both) must meet the minimum fit and proper requirements. These are:
- Regulatory examinations
- Continuous Professional Development
- Product specific training
- Class of business training
All administrative staff or personal assistants have to be registered on the representative register. They must have a matric or an equivalent (NQF4) school leaving qualification before they may be registered on the FSCA’s register as a representative for Intermediary Services.
Once registered on the FSCA register, the following criteria will apply:
Each personal assistant or administrator must obtain/receive the following while working under the supervision of a duly qualified financial adviser within the same company:
- Product specific training for the products marketed by the financial adviser by 31 July 2018 (this training will be provided by the relevant product providers).
- 18 hours of continuous professional development between 1 June 2018 and 31 May 2019 (The FSP in partnership with an accredited and approved Training Provider, who will assist in obtaining and uploading CPD activities).
- Class of business training in the product classes marketed by the financial adviser by 31 July 2019 (this must be done by an accredited training provider such as Integrity Academy or other QCTO or Inseta accredited providers).
- The preparation for regulatory examination for representatives by 30 June 2020 (which can be done through an institution such as Integrity Academy or other QCTO or Inseta accredited providers or your compliance officers).
- A full qualification recognised by the FSCA (Minimum NQF5) by 30 June 2024, (which can be done through an approved and registered institution such as Integrity Academy or other QCTO or Inseta accredited provider).
If the personal assistant or administrative employee assists with duties relating to short-term insurance and long-term insurance, Health or Investments, the higher qualification requirement will apply.
Compiled and written by:
JH Wynand Louw CFP® FIISA
#AFSOnline #WynandLouwCFP #WynandLouwAFS
Based on an original article written by Jackie Drotsky, Licenced Compliance Officer, Momentum Consult