FSB head speaks out on corruption

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"The FSB, as an organisation, [has] zero tolerance for corruption. We don't condone any corruption at all.

"... The FSB ... has two distinct functions... one being the mandate given by Parliament, which is the regulatory mandate. The other is the administration leg, such as HR," Tshidi said at a media briefing on Thursday, 3 July.

His comments follow the resignation of the Chief Financial Officer (CFO) of the FSB, Dawood Seedat, last month. Seedat resigned after corruption allegations were levelled against him in his personal capacity.

This prompted the FSB to launch a comprehensive investigation into the allegations against Seedat. The investigation includes a full internal audit, supported by the office of the Auditor General. If any finding is made, a full forensic investigation will be conducted.

Tshidi could not, however, confirm when the investigation will be completed. "We are hoping that it won't be long. It must take the shortest time possible. We want to see this matter behind [us]."

Before his resignation, Seedat retroactively disclosed to the FSB that he had done consulting work for Africa Cash & Carry. Employees of the FSB are required to disclose any outside business interests, which Seedat did not do before doing business with Africa Cash & Carry.

Meanwhile, Tshidi said the post for a new CFO of the FSB will be advertised shortly.

"This coming weekend, you will see the advert that will be out in the media. It's an external advert," said Tshidi.

Gihwala resignation

In the same briefing, the FSB shed light on the resignation of Dines Gihwala as curator of the financial services business, Fidentia.

The FSB received Gihwala's resignation on 26 June. Gihwala was appointed as provisional curator of Fidentia by the Western Cape High Court in February 2007. His appointment was made final in March 2007.

As a formality, his appointment must be cancelled by the same court and the FSB will in due course make an application for an appropriate order.

"The FSB does not appoint curators, the court appoints the curators. The FSB may and can put recommendations forward for the court's consideration but the court applies its mind. The court has the authority," said Deputy CEO of the Financial Advisory and Intermediary Services (FAIS), Caroline Da Silva.

The FSB will make its recommendation regarding this shortly, she said.

Former Fidentia CEO J Arthur Brown was arrested in 2007 after it was found that money went missing from funds that were administered by Fidentia. This included a fund meant to support orphans and widows of mine workers. He has subsequently been convicted.

On the same day that Gihwala tendered his resignation, the FSB became aware of a decision handed down by the High Court that contained adverse findings against him.

In November 2013, the new registrar of FAIS instructed an audit into the fees and costs of the Fidentia curatorship and the costs attached to it.

"It was an internal audit. This audit is probably three quarters complete," Da Silva said, adding that the audit will be completed by an external independent auditor.

About the FSB

The FSB is government's financial regulatory agency responsible for the non-banking financial services industry in South Africa.

It is an independent body that supervises and regulates the financial services industry in the public interest. This includes the regulation of the biggest stock exchange in Africa -- the Johannesburg Stock Exchange.