Subject Title - INSETA

PurposeThe FIC Act imposes certain responsibilities on FSPs that are „accountableinstitutions‟. Supervisory bodies, such as the FSB are empowered through theAct to enforce compliance with money laundering legislation. This chapter willtake you through the impact of FIC on the FSP and the reporting and recordkeepingduties required by the FIC Act. It does not include a comprehensiveanalysis of the Act.We also look briefly at other applicable anti-money laundering legislation.15.1 THE SCOPE OF THE FINANCIAL INTELLIGENCE CENTRE ACTOne of the objectives of the FICA is to introduce control measures to assistthe detection and investigation of money laundering activities. The primarypurpose of the FIC Act is to combat money laundering.Money laundering refers to any act that obscures the illicit nature or theexistence, location or application of proceeds of crime.Simply put, money laundering is the processing of proceeds of criminalactivities to disguise their origin.Money laundering happens throughout the financial services sector and it isimportant that:financial advisers and intermediaries know with whom they are doingbusinessthe paper trail of transactions through the financial system can beidentified and preserved; andpossible money laundering transactions are identified and reported.The FICA introduced the following control measures. Institutions must:be able to establish and verify the identity of their clientskeep certain recordsreport certain information; andimplement measures that will assist them in complying with the FICA,such as training of staff.246 © INSETA - Section 1 12a