Latest news with #FinancialAdvisoryandIntermediaryServicesAct
The Citizen
6 days ago
- Politics
- The Citizen
Leaked Bushiri case affidavit puts witness at risk, warns NPA
Shepherd Bushiri and his wife, Mary, are facing extradition to South Africa to stand trial on multiple serious charges, including fraud and rape Self-proclaimed prophet Shepherd Bushiri and his wife, Mary, in the Pretoria Magistrate's Court during their bail application on 4 November 2020. Picture: Jacques Nelles The National Prosecuting Authority (NPA) has expressed serious concern over the leak of a confidential affidavit belonging to a key state witness in the fraud and money laundering case involving self-proclaimed prophet Shepherd Bushiri and his co-accused. The NPA said the affidavit forms part of the documents in the case docket that was disclosed to the defence for the accused to prepare for their trial. Witness endangering NPA regional spokesperson Lumka Mahanjana slammed the leaking of the document which contains the witness's full personal details and even her photograph published by a media outlet 'It is very concerning as this leaked affidavit has the potential to compromise the state's case. It also endangers the life of the state witness because her full details, including a photo of her, were published in the media,' she said. Mahanjana said the case was set down for trial to commence on 14 October 2024, almost a year ago. 'However, the case has been met with numerous interlocutory applications by some of the accused attempting to delay the trial. None of these interlocutory applications were successful. Despite all these applications, the state has always maintained its readiness to start with the trial,' Mahanjana said. ALSO READ: Bushiris file application to set aside ruling ordering extradition to SA Media houses She urged media houses to exercise restraint and act in the public interest without compromising legal processes or endangering individuals involved in the case. 'We therefore urge the media to be responsible when exercising their mandate to produce news to keep the public informed to do so without jeopardising the rights of the witnesses who will be called to testify.' Mahanjana did not disclose whether an investigation into the source of the leak is underway. Bushiri's Bushiri and his co-accused face at least six charges, including rape, violating bail conditions and contraventions of the Financial Advisory and Intermediary Services Act, Banking Act, Civil Aviation Act and Immigration Act. Bushiri and his wife, Mary Bushiri, fled to Malawi in November 2020, after being granted bail of R200 000 each under strict conditions by the Pretoria Central Magistrate's Court. The case is set down for trial on 4 August 2025. ALSO READ: Bushiri celebrates reduced charges, but can they be reinstated? Malawi's attorney general explains
IOL News
10-07-2025
- Business
- IOL News
South Africa's crypto market faces regulatory reckoning amid tax demands
The Financial Sector Conduct Authority introduced licensing requirements for crypto asset service providers under the Financial Advisory and Intermediary Services Act, aiming to strengthen consumer protection by classifying crypto assets as financial products. Image: Independent Newspapers/File AS South Africa's cryptocurrency sector hurtles through a turbulent regulatory and tax landscape, evolving rules and heightened scrutiny are forcing investors and service providers to scramble for clarity. As regulatory authorities tighten their grip, questions loom large: How do capital gains taxes apply to crypto disposals? What exactly are the obligations for those simply holding digital assets? While cryptocurrencies may not be legal tender, the SA Revenue Service (Sars) has made one thing clear — it is treating them as taxable intangible assets, triggering capital gains tax upon sale or disposal. The Financial Sector Conduct Authority (FSCA) introduced licensing requirements for crypto asset service providers under the Financial Advisory and Intermediary Services (Fais) Act, aiming to strengthen consumer protection by classifying crypto assets as financial products. Meanwhile, the Gauteng High Court's recent ruling on cryptocurrencies and exchange control regulations sparked significant debate, with the SA Reserve Bank (Sarb) appealing the decision and maintaining its stance that crypto is not legal tender. As the Sarb continues to shape its regulatory approach, crypto investors and service providers face ongoing challenges in adapting to this evolving landscape. Adding another regulatory layer is the Financial Intelligence Centre (FIC), which enforces anti-money laundering and counter-terrorism financing compliance, mandating registration and reporting duties for crypto providers. This dynamic regulatory environment seeks to balance innovation with investor safety and financial stability. To get more insight on this, the Sunday Independent spoke to Sebaga Matabane, the chief executive of a leading Crypto Firm as well as a derivatives and fintech expert. Matabane is also a recognised key opinion leader in Africa's fintech and digital assets space and an FSCA-approved key individual. She brings together deep regulatory insight, strategic foresight, and operational leadership. Sebaga Matabane is a derivatives and fintech expert and a recognised key opinion leader in Africa's fintech and digital assets space. Image: Supplied Sunday Independent (SI): How does the capital gains tax framework apply to cryptocurrency disposals for individual investors in South Africa? Sebaga Matabane (SM): When an individual in South Africa sells or otherwise disposes of cryptocurrency — whether by trading, converting to fiat, or using it for purchases — it triggers a capital gains tax (CGT) event. The first R40 000 of gains annually is excluded, after which 40% of the net capital gain is included in the individual's taxable income. For those in the top tax bracket, this translates to a maximum effective CGT rate of 18%. Timing and accurate record-keeping are key, especially as Sars sharpens its focus on digital asset transactions. SI: What are the tax implications for South African crypto investors who only hold their assets without disposing of them? SM: If you're merely holding crypto without selling, converting, or using it, there's no immediate tax liability — but that doesn't mean it flies under the radar. Sars requires all crypto holdings to be declared in your tax return, even if no taxable event has occurred. Think of it as financial transparency now, to avoid compliance issues later. SI: What licensing requirements does the FSCA impose on crypto asset service providers under the Financial Advisory and Intermediary Services (FAIS) Act? SM: The FSCA now defines crypto assets as financial products, which means any business offering crypto-related services — such as exchanges, trading platforms, or wallet providers — must be licensed as a Financial Services Provider (FSP) under the FAIS Act. This includes appointing approved key individuals, meeting fit and proper requirements, having compliant governance structures, and aligning with ongoing conduct obligations. The intention is to create market integrity, promote professionalism, and ensure consumer protection. SI: How does the FSCA's classification of crypto assets as financial products impact consumer protection in the crypto market? SM: This classification is a game changer. It brings crypto under the same protective framework as other financial instruments, enabling the FSCA to monitor and act against misconduct, misrepresentation, and unfair business practices. Consumers can now benefit from advice from licensed providers, recourse mechanisms, and better disclosure standards. It sets the stage for a more trustworthy and accountable market. SI: How is the SARB approaching the regulation of cryptocurrencies, given that they are not recognised as legal tender? SM: While the SARB maintains that crypto assets do not qualify as legal tender, it acknowledges their growing influence. Its approach is cautious but strategic: it collaborates with other regulators through the Intergovernmental Fintech Working Group (IFWG), explores use cases via sandbox environments, and keeps a close eye on systemic risk, monetary sovereignty, and exchange control circumvention. The Reserve Bank's messaging is clear: crypto is not a threat to ignore, but neither is it a form of money just yet. SI: What is the significance of the Gauteng High Court ruling regarding cryptocurrencies and exchange control regulations, and how might SARB's appeal affect this? SM: The Gauteng High Court's decision that cryptocurrencies are not subject to exchange control regulations has major implications — it effectively opens the door for freer movement of crypto across borders, which could impact capital flows, financial surveillance, and offshore structuring. However, the Sarb is appealing the ruling, signalling its intent to retain oversight. If the appeal succeeds, crypto flows may be subjected to stricter monitoring and reporting, reshaping how exchanges and OTC desks operate. It's a legal pivot point to watch. SI: What challenges do crypto investors and service providers face in navigating the evolving regulatory and tax landscape in South Africa? SM: The biggest challenge is regulatory ambiguity coupled with rapid change. Investors are grappling with complex tax reporting, unclear treatment of cross-border transactions, and a lack of practical guidance. Meanwhile, service providers must juggle licensing deadlines, AML/CFT compliance, FIC registration, and a mounting expectation of institutional-grade conduct — all while trying to remain agile and innovative. Ultimately, navigating this space requires a blend of legal foresight, tax expertise, and operational discipline. It is clear that the country's cryptocurrency sector stands at a critical crossroads, caught between the forces of innovation and regulation. Yet within this turbulence lies opportunity. The regulatory reckoning now underway could very well lay the foundation for a more secure, transparent, and mature crypto market. But success will depend on the ability of players to adapt swiftly, comply fully, and anticipate the next wave of regulatory evolution. In this high-stakes game of compliance and innovation, one thing is certain: the rules are being written — and those who understand them, shape them, or break them will define the future of crypto in South Africa, and Africa as a whole. Get the real story on the go: Follow the Sunday Independent on WhatsApp.
IOL News
27-06-2025
- Business
- IOL News
FSCA provisionally withdraws licence of Nessfin Investments
The Financial Sector Conduct Authority (FSCA) has provisionally withdrawn the licence of Nessfin Investments Ltd. Image: File The Financial Sector Conduct Authority (FSCA) has provisionally withdrawn the licence of Nessfin Investments Ltd and Finance Group (Pty). The company is no longer authorised to conduct financial services. This comes following concerns about its involvement with an unauthorised financial services provider operating in the crypto asset sector. Nessfin was authorised to offer a limited range of financial services related to crypto assets. However, in August 2024, the FSCA discovered that Nessfin was in possession and control of funds collected by My Wealth Legatus (Pty) Ltd (Legatus), a company not authorised by the FSCA and under investigation for conducting unregistered financial services. The FSCA has previously warned the public about My Wealth Legatus, suspecting the company of offering unregistered financial services and operating as a bank without the necessary authorisation. "Based on the evidence collected by the FSCA thus far, it appears that Nessfin conducted financial services business beyond what it is permitted by its current authorisation," FSCA said. "Also, in terms of governing law (being the Financial Advisory and Intermediary Services Act), an FSP is prohibited from conducting financial services related business with any person that is not correctly authorised by the FSCA. Based on the nature of its relationship with Legatus, the FSCA is of the view that Nessfin also contravened the FAIS Act in this way" The financial watchdog also confirmed that the investigations into Nessfin are ongoing. "The investigation into Nessfin is ongoing, but at this stage, the FSCA has material concerns about Nessfin's business. Thus, the FSCA decided to provisionally withdraw the FSP licence of Nessfin as it is satisfied on reasonable grounds that substantial prejudice to clients and/or the general public may occur if the licence is not provisionally withdrawn," IOL Business Get your news on the go, click here to join the IOL News WhatsApp channel
The Citizen
22-06-2025
- Business
- The Citizen
Buy now, panic later? Why payment system might be too good to be true
Is 'buy now, pay later' empowering consumers, or quietly indebting them? 'Buy now, pay later' payment options have strutted onto South Africa's financial runway with the swagger of innovation, offering interest-free instalments, bypassing traditional credit checks and boasting sleek user interfaces that make old-school lay-bys look prehistoric. For consumers, it feels like a dream: swipe today, split it tomorrow. For platforms, it is fintech gold. But beneath the surface of this frictionless façade lies a regulatory grey zone thick with risk, ambiguity and potential litigation, Lerato Lamola and Anél De Meyer, partners at Webber Wentzel, warn. 'Buy now, pay later' services allow consumers to buy things immediately and pay for them in instalments over a set period, usually without interest if payments are made on time. However, as usage of the 'buy now, pay later' option increases, concerns around consumer debt, regulatory arbitrage and financial exclusion also grow. Lamola and De Meyer say the central question in South Africa is whether 'buy now, pay later' products fall within the jurisdiction of the National Credit Act or the Financial Advisory and Intermediary Services Act (FAIS Act). ALSO READ: Credit and the law: Here are the rights you must know about How credit is regulated in SA The National Credit Regulator (NCR) is responsible for enforcing compliance with the National Credit Act, while the Financial Sector Conduct Authority (FSCA) is responsible for compliance with the FAIS Act. The consumer credit environment in South Africa is governed by the National Credit Act, which regulates all credit providers and mandates affordability assessments along with other consumer protection mechanisms. 'Buy now, pay later' providers often argue that they are not credit providers, as their terms and conditions do not constitute a credit agreement, Lamola and De Meyer say. 'They say this is because they charge no interest and operate within a very short payment cycle of four to six weeks. As a result, many 'buy now, pay later' firms claim exemption from the obligations they would have under the National Credit Act.' ALSO READ: Buy now, pay later a convenient way to buy if you qualify Buy now, pay later falls into regulatory void According to the Intergovernmental Fintech Working Group (IFWG), 'buy now, pay later' options currently fall into a regulatory void. The NCR has taken limited action against providers, while the FSCA must still issue clear guidance. Therefore, Lamola and De Meyer say, consumers face reduced transparency, while there are no guaranteed recourse mechanisms and inconsistent contract terms. The legal classification of 'buy now, pay later' determines the scope of regulatory obligations, Lamola and De Meyer say. 'If buy now, pay later is credit, the National Credit Act mandates affordability checks, registration with the NCR and extensive disclosures. 'However, most buy now, pay later operators avoid these obligations by structuring their offerings as payment solutions or deferred billing.' They point out that the FAIS Act regulates financial advice and intermediary services. 'Buy now, pay later providers rarely claim to offer financial advice and as such, FAIS oversight is generally not invoked. This ambiguity causes a jurisdictional conflict between the NCR and FSCA, with little resolution.' ALSO READ: Buy now, pay later good news for small businesses Do consumers know enough about it? In addition, they say, South Africans are often unaware of potential late fees, the implications of missed payments, or the lack of legal recourse, especially when providers collapse or change terms unilaterally. Lamola and De Meyer point out that while legal classification remains unresolved, enforcement action against 'buy now, pay later' providers in South Africa has been minimal. 'In practice, the NCR's enforcement has focused largely on traditional credit providers, while the FSCA's mandate remains unclear in the absence of explicit statutory triggers.' They warn that this lack of supervisory clarity raises risks of selective compliance, where only larger players seek legal advice or act pre-emptively, while smaller or offshore providers bypass South African oversight altogether. 'In addition, without designated supervisory frameworks, enforcement becomes reactive, often occurring only after consumers are harmed.' ALSO READ: Beware: debt is often no more than a click away COFI Bill could address 'buy now, pay later' regulatory gaps However, they say the Conduct of Financial Institutions Bill (COFI Bill) is envisaged to address these regulatory gaps. 'A modern regulatory regime must therefore address not only classification and jurisdiction, but also enforcement mechanisms, investigative powers and coordinated oversight, possibly through inter-agency memoranda of understanding or joint supervisory task teams. 'Without this, regulatory gaps become systemic vulnerabilities.' Lamola and De Meyer say South Africa's current dual-regulator model is ill-equipped for the digital fragmentation of modern finance. 'The lack of a clear buy now, pay later regulatory framework stands in contrast with jurisdictions where regulators have already expanded definitions of credit to include buy now, pay later explicitly. 'We hope that the COFI Bill will reconcile its institutional gaps and avoid regulatory arbitrage by expanding statutory definitions and enforcing consistency.' They say it is unclear whether a platform offering 'buy now, pay later' options at checkout could be deemed to be providing or facilitating credit under the National Credit Act. 'Retailers and marketplaces must consider whether they are indirectly exposing themselves to liability or reputational risk, especially if their partners engage in misleading conduct, impose unlawful fees, or collapse without notice.' ALSO READ: How to build a strong credit score to unlock financial freedom Verification and affordability assessments important De Meyer and Lamola say one major challenge for effective 'buy now, pay later' regulation in South Africa lies in consumer verification and affordability assessments. 'Without a robust credit history or consistent income documentation, many consumers who use these services remain invisible to traditional risk models. 'This opens the door to over-indebtedness, particularly among the underbanked. Future Buy Now Pay Later regulation must therefore account for the reality of fragmented digital footprints and low formal credit participation. 'Buy now, pay later redefined consumer finance by promising simplicity and speed, but the country risks repeating mistakes seen in unregulated microcredit booms if it fails to address its regulatory gaps. 'Global trends show that regulation can evolve in tandem with technology. By embracing reform and cross-sector collaboration, South Africa can lead in creating a safe, competitive digital finance ecosystem.' NOW READ: Why you should use credit responsibly
The Citizen
05-06-2025
- Politics
- The Citizen
Bushiris file application to set aside ruling ordering extradition to SA
The couple fled to Malawi in November 2020. Self-proclaimed prophet Shepherd Bushiri and his wife Mary in the Pretoria Magistrate's Court during their bail application on 4 November 2020. Picture: Jacques Nelles Self-proclaimed prophet Shepherd Bushiri and his wife, Mary Bushiri, have filed a review application to set aside the judgment ordering their extradition to South Africa. The Bushiris filed their application before the High Court of Malawi in Lilongwe on Wednesday. They claim they weren't given a chance to be heard, violating natural justice principles. Hearing In papers before the high court in Malawi, the controversial couple claim they weren't given a chance to be heard, violating natural justice principles They argued the chief magistrate erred in law by breaching the fundamental principles of natural justice. 'The applicants humbly but firmly pray for the quashing of the findings that the requesting State made out a case for extradition… setting aside of the order of committal.' In March, Malawi's Chief Resident Magistrate's Court ordered that the Bushiris be extradited following a request by South Africa. ALSO READ: Bushiri celebrates reduced charges, but can they be reinstated? Malawi's attorney general explains Charges They face at least six charges including rape, violating bail conditions, contraventions of the Financial Advisory and Intermediary Services Act, Banking Act, Civil Aviation Act and Immigration Act. The couple fled to Malawi in November 2020, after being granted bail of R200 000 each under strict conditions in the Pretoria Central Magistrate's Court. ALSO READ: Cops detained Bushiri's lawyers for corruption, intimidation say Hawks 'Safety and security' At the time, Bushiri cited 'safety and security issues' for their actions. 'There have been clear and evident attempts to have myself, my wife and my family killed. Despite our several attempts to report to authorities, there has never been state protection,' he said. 'We have come to a painful conclusion that what my wife and I have faced in the Republic of South Africa since 2015 is purely persecution, not prosecution. 'What is shocking is that it was me who, in 2018, opened cases of extortion and intimidation against the officers who are, today, investigating, arresting and prosecuting me and my wife of these several allegations. Obviously, there can never be independence and impartiality. It's purely acts of open vengeance,' Bushiri said. The Malawian couple run a church known as Enlightened Christian Gathering with branches in various African countries. ALSO READ: Malawi court grants South Africa's request to extradite Shepherd Bushiri and wife
