FIC guidance note 4B covers section 29 regulatory reports in greater detail, including providing indicators of suspicious and unusual transactions and/or activities. An FSP may continue with the transaction if they have submitted an STR, unless the FIC directs the FSP to stop the transaction. No legal action, whether criminal or civil, can be instituted against any natural or legal person who complies in good faith with the reporting obligations of the FIC Act.

A person involved in the making of a section 29 report may not inform anyone, including the client or any other person associated with a reported transaction, of the contents of an STR or even that such a report has been made.

As part of an FSP’s ongoing due diligence obligations, it must monitor client transactions and understand the client’s source of funds. This will help determine whether transactions are consistent with the FSP’s knowledge of the client and their risk profile. The FSP must understand the background and purpose of all complex and unusually large transactions. This will enable the FSP to identify suspicious and unusual transactions.

FSPs may use an automated transaction monitoring system (ATMS) to monitor client transactions. This must be done in line with Directive 5 and public compliance communication 45 (PCC 45) issued by the FIC.

Section 28* of the FIC Act sets out the obligation to submit to the FIC reports on cash transactions exceeding R24 999.99. Where an FSP receives or makes a cash payment and/or a series of cash payments exceeding R24 999.99, the institution must report the transaction(s) to the FIC. Cash includes coin, paper money and travellers’ cheques. The FIC guidance note 5B provides guidance on CTRs.

*Note that there are proposed changes to this reporting obligation that are pending commencement.

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