Capitec was fined R28 million.
Picture: Gallo Images/Jacques Stander
The Prudential Authority (PA) has imposed administrative sanctions, including fines, on Capitec Bank, Albaraka Bank Limited, and Ninety One Assurance Limited.
PA is a regulatory body within the administration of the South African Reserve Bank (Sarb) responsible for promoting the safety and soundness of financial institutions.
The organisation is mandated to supervise and enforce compliance by accountable institutions with the provisions of the Financial Intelligence Centre Act 38 of 2001 (FIC Act), and with any order, determination or directive made in terms thereof.
Prudential Authority fines Capitec
The PA said it imposed administrative sanctions on Capitec for non-compliance with certain provisions of the FIC Act, following an inspection conducted in 2023 under section 45B of the FIC Act.
Capitec was also hit with a financial penalty totalling R28 million, of which R5.5 million is conditionally suspended for 36 months from 13 October 2025.
“Capitec failed to comply with section 21, read with sections 42(1) and 42(2)(d), of the FIC Act, in that it failed to conduct adequate customer due diligence on the sampled client files,” said the PA.
The PA imposed a caution not to repeat the conduct that led to the non-compliance and a financial penalty of R10 million, of which R3 million is conditionally suspended for 36 months.
Prudential Authority finds
The PA also found that Capitec failed to conduct adequate enhanced due diligence on the sampled client files.
For this failure, the PA imposed a caution not to repeat the conduct that led to the non-compliance and a financial penalty of R5 million, of which R1 million is conditionally suspended for 36 months.
“Capitec failed to comply with section 21C, read with sections 42(1) and 42(2)(g), of the FIC Act, in that it failed to conduct adequate ongoing due diligence on the sampled client files,” said the PA.
“The PA imposed a caution not to repeat the conduct that led to the non-compliance and a financial penalty of R5 million, of which R1 million is conditionally suspended for a period of 36 months.”
Failure to provide training
The PA found that Capitec failed to provide ongoing training to the sampled employees. As a result, the bank was hit with a financial penalty of R3 million.
Capitec also failed to obtain management approval for its business bank anti-money laundering name screening and payment screening investigation manuals before implementation thereof.
The lender also failed to evidence that it had documented and approved end-to-end processes pertaining to terrorist property reporting (TPR) prior to receiving an inspection notification letter from the PA.
“The PA imposed a caution not to repeat the conduct that led to the non-compliance and a financial penalty of R5 million, of which R500 000 is conditionally suspended for a period of 36 months.”
Prudential Authority comes for Albaraka Bank
The PA imposed administrative sanctions on Albaraka Bank Limited (Albaraka) for non-compliance with certain provisions of the FIC Act, following an inspection conducted in 2021 under section 45B of the FIC Act.
“The administrative sanctions imposed on Albaraka consist of three cautions not to repeat the conduct that led to the non-compliance, and a financial penalty totalling R1.6 million, of which R440 000 is conditionally suspended for a period of 36 months from 10 June 2024,” said the PA.
Non-compliance by Albaraka Bank includes failure to timeously report 232 Cash Threshold Reports and/or Aggregated Cash Threshold Reports.
Albaraka Bank fails to report suspicious transactions
According to the PA, Albaraka Bank also failed to timeously report 144 Suspicious Transaction Reports and/or Suspicious Activity Reports.
The bank also failed to document the rationale regarding risk factors being assessed and the assigned risk weightings; document trigger events that may warrant a review or a change in a customer’s risk rating; and document industries, activities and business relationships that it prohibits in its Risk Management and Compliance Programme (RMCP).
“Albaraka Bank failed to provide evidence that it had taken into consideration the local geographical locations it operates in and where its customers are based in its money laundering/terrorist financing risk assessment,” said the PA.
Ninety One fined R6 million
The PA imposed administrative sanctions on Ninety One Assurance Limited (Ninety One) for non-compliance with certain provisions of the FIC Act.
Sanctions include two cautions not to repeat the conduct that led to the non-compliance, two reprimands, and a financial penalty totalling R6 million, of which R2.5 million is conditionally suspended for 36 months from 19 June 2025.
Ninety One is a registered long-term insurance company that underwrites specific investment products and pooled funds offered by the global asset manager.
Failure to monitor risk
The PA found that the insurance company failed to adequately develop, document, maintain and/or implement an RMCP that would enable it to effectively identify, assess, monitor, mitigate and/or manage its risk associated with sanctions screening, prominent influential person screening, its business and its clients.
It was also found that Ninety One failed to provide evidence of adequately documented and implemented policies, procedures and controls to provide for the manner in which and the processes by which, where applicable, it will comply with such obligations.
“Ninety One has cooperated with the PA and has indicated that it has undertaken the remedial action required to address the identified compliance deficiencies and control weaknesses.”
