Client Compliance

Why Do We Need This Information?

A LEGAL REQUIREMENT FOR ALL PROPERTY TRANSACTIONS

 

At Coastal Relocations, we understand that providing identification documents, FICA information, a signed mandate and a Mandatory Disclosure may sometimes feel like unnecessary administration.

 

It is not optional administration.

 

As a registered property practitioner, Coastal Relocations is legally required to comply with the Property Practitioners Act 22 of 2019, the PPRA Code of Conduct and the Financial Intelligence Centre Act 38 of 2001 (FICA).

 

These laws place obligations on us as the property practitioner. We therefore cannot simply choose not to collect the required information because a client does not wish to provide it.

 

1. WHY DO WE NEED A MANDATE?

 

The PPRA Code of Conduct, clause 34.3.1.1, provides that an estate agent may not:

• offer, purport or attempt to offer any immovable property for sale or to let, unless the agent has been given a mandate by the seller or lessor, or their duly authorised agent.

 

This means that before Coastal Relocations can properly offer a property for sale or rental, we must have the appropriate authority from the owner.

 

In practical terms: No mandate = no authority to market the property.

 

This applies whether the property is being marketed through Property24, Private Property, social media, our website, WhatsApp, email, signage or any other marketing channel.

 

2. WHY DO WE NEED A MANDATORY DISCLOSURE?

 

The Property Practitioners Act 22 of 2019, section 67(1)(a) provides that a property practitioner:

• must not accept a mandate unless the seller or lessor has provided a fully completed and signed mandatory disclosure.

 

The Mandatory Disclosure is therefore not simply a form Coastal Relocations has chosen to use.

 

It is a statutory requirement.

 

Section 67(1)(b) further requires the mandatory disclosure to be provided to a prospective purchaser or lessee who intends to make an offer.

 

The completed disclosure must also form part of the eventual sale or lease agreement in accordance with section 67(2).

 

In practical terms: We require the completed and signed Mandatory Disclosure before accepting the mandate.

 

3. WHY DO WE NEED FICA INFORMATION?

 

Estate agents/property practitioners are classified as Accountable Institutions under Schedule 1, Item 3 of the Financial Intelligence Centre Act 38 of 2001.

 

The FIC Act requires accountable institutions to perform customer due diligence and comply with a range of anti-money-laundering and financial-crime obligations. These include, amongst other things:

• Identifying and verifying clients;
• Obtaining prescribed identification information;
• Verifying the identity of the client;
• Identifying beneficial owners where applicable;
• Establishing and understanding the nature and purpose of the business relationship;
• Risk-rating clients where required;
• Screening clients against applicable targeted financial sanctions lists;
• Keeping prescribed records;
• Monitoring transactions;
• Reporting suspicious and unusual transactions where required; and
• Maintaining appropriate compliance procedures and records.

 

The FIC specifically confirms that estate agents are accountable institutions and that these obligations apply to them. 

 

4. WHAT HAPPENS IF WE DO NOT COMPLY?

 

These requirements are not merely guidelines.

 

The Financial Intelligence Centre has enforcement powers and may impose administrative sanctions for non-compliance with FICA obligations. The FIC states that sanctions can be imposed where an accountable institution or person has failed to comply with the FIC Act and applicable directives.

 

Depending on the particular contravention, the consequences can be serious.

 

For example, Failure to register with the FIC Under section 61A of FICA, failure to register where required is an offence and may result in:

A fine of up to R10 million OR imprisonment for up to 5 years.

 

Failure to submit a required suspicious transaction report

The FIC confirms that failure to submit a report required under section 29 can result in:

A fine of up to R100 million OR imprisonment for up to 15 years.

 

The FIC's official reference guide also sets out substantial administrative sanctions for failures relating to customer due diligence, record keeping, reporting, risk management, training and other compliance obligations.

 

These penalties are one of the reasons Coastal Relocations must take FICA compliance seriously.

 

We cannot put our PPRA and FICA compliance at risk because a client would prefer not to provide the required information.

 

5. WHAT IF I DON'T WANT TO PROVIDE MY FICA DOCUMENTS?

 

We respect your right to ask why your information is required and how it will be handled.

 

However, where the information is required for our legal compliance, we cannot simply waive the requirement. If the required FICA verification cannot be completed, Coastal Relocations may be unable to:

• accept or proceed with a mandate;
• proceed with a property transaction;
• continue acting for the client; or
• proceed to the next stage of the transaction,

 

depending on the circumstances and the nature of the outstanding compliance requirement.

 

This is a legal compliance issue rather than a Coastal Relocations policy designed to inconvenience clients.

 

6. WE MAKE THE PROCESS AS EASY AS POSSIBLE

 

We use RubyFICA to make the FICA process quick and convenient.

 

You receive a secure link and can complete the required information and upload your documents from your phone.

 

RubyFICA assists property practitioners with collecting client information, document collection, screening and maintaining a compliance record. It does not replace Coastal Relocations' own legal responsibilities under FICA.

 

We also use Ruby Docs to simplify the completion and signing of property-related documents electronically.

 

This means that in most cases, you can complete the required documentation without printing, scanning or visiting our offices.

 

7. YOUR INFORMATION AND POPIA

 

We appreciate that FICA involves personal information.

 

Coastal Relocations is committed to handling personal information responsibly and in accordance with the Protection of Personal Information Act 4 of 2013 (POPIA).

 

Where information is collected because we are required to comply with a legal obligation, the processing is not simply based on optional consent.

 

FICA records are also subject to statutory retention requirements. RubyFICA explains that FICA records are generally required to be retained for at least five years.

 

OUR COMMITMENT TO YOU

 

Our intention is not to create unnecessary administration.

 

Our responsibility is to ensure that you, our clients, and Coastal Relocations are protected and that every transaction is conducted in accordance with South African law.

 

For this reason, we ask all clients to please complete the required:

• Mandate
• Mandatory Disclosure
• FICA verification and supporting documentation
• Other legally required compliance documentation where applicable

 

We appreciate your cooperation and assure you that our team will assist you throughout the process.

 

Compliance is not optional - it is part of our legal responsibility to you and to the regulatory authorities.