1. Understanding FICA

FICA is the commonly used name for the Financial Intelligence Centre Act, 2001 (Act 38 of 2001).

The Act establishes important measures for combating money laundering, terrorist financing, proliferation financing and other financial-crime risks.

Accountable institutions have obligations that include appropriate customer due diligence, record keeping, risk management and regulatory reporting where required.

2. Why Verification Is Required In Property

Residential property transactions can involve valuable assets, substantial payments, multiple parties, legal entities and funds moving between different parties.

Appropriate verification helps a property business understand who it is dealing with and whether additional information or investigation is required.

• Confirm the identity of relevant clients.
• Understand who is acting on behalf of another person or entity.
• Establish relevant ownership or control structures.
• Identify beneficial owners where applicable.
• Understand the nature and purpose of the relevant relationship or transaction.
• Apply appropriate additional due diligence where higher risk is identified.

3. Who May Need To Be Verified?

The parties requiring verification will depend on the property matter and the nature of the relationship.

Depending on the circumstances, this may include:

• Sellers and property owners.
• Buyers or prospective purchasers.
• Landlords.
• Tenants or rental parties where verification is applicable.
• Directors or authorised company representatives.
• Trustees or authorised trust representatives.
• Members, partners or authorised signatories.
• Natural persons identified as relevant beneficial owners.
• A person acting under an appropriate mandate, resolution, power or other authority.

4. Verification For Individuals

Verification should be appropriate to the particular client and circumstances. Examples of information that may be requested from an individual include the following.

5. Companies, Trusts & Other Entities

Where a property matter involves a company, close corporation, trust, partnership or another legal structure, Fabulous Homes may need additional information about both the entity and the people acting for or controlling it.

6. Beneficial Ownership

When a company, trust or another legal structure is involved, identifying the registered entity may not always be enough.

Depending on the circumstances, due diligence can also require information identifying the natural person or persons who ultimately own, exercise control over or benefit from the relevant entity.

Additional documents may therefore be requested to understand ownership and control structures.

7. Source Of Funds & Additional Information

Source-of-funds or source-of-wealth information is not necessarily requested in exactly the same way for every client or property matter.

Additional information may, however, be required where appropriate to the transaction, client profile or identified risk.

• Information explaining where transaction funds originate.
• Relevant banking or payment information.
• Information concerning large, unusual or complex payments.
• Clarification where funds are being provided by another person or entity.
• Additional information concerning ownership, control or authority.
• Other information reasonably required by the applicable customer-due-diligence process.

8. Risk-Based Customer Due Diligence

FICA compliance follows a risk-based approach. This means that verification is not simply a mechanical exercise where every person receives an identical document list.

A lower-risk, straightforward matter may require a different level of information from a more complex or higher-risk relationship.

Additional due diligence may be appropriate where, for example:

• ownership structures are complex;
• authority to act requires further verification;
• the transaction or payment structure is unusual;
• international parties or structures are involved;
• persons in prominent positions or other higher-risk circumstances are relevant;
• information is inconsistent or requires clarification; or
• another factor results in increased money- laundering or financial-crime risk.

9. Information May Need To Be Updated

Client due diligence is not always completed once and then forgotten permanently.

Where appropriate, information may need to be updated during a business relationship or when circumstances change.

Fabulous Homes may therefore request updated or additional information if existing information becomes outdated, the nature of the property matter changes or further verification is required.

10. Record Keeping & Personal Information

Information and records obtained for FICA and transaction-related purposes may need to be kept for periods prescribed by applicable law.

FICA records can contain personal information. The processing of that information should therefore also be considered alongside applicable privacy and information-security obligations.

Fabulous Homes aims to process personal information for legitimate property, compliance and related business purposes, subject to applicable law.

11. What If Required Information Is Not Provided?

Where Fabulous Homes is legally or operationally required to complete appropriate verification, it may be unable to establish or continue the relevant client relationship or complete certain property-related steps until the required information has been obtained.

Depending on the circumstances, this may affect a mandate, property instruction, offer, rental process, transaction step or another service for which verification is required.

The exact consequence depends on the particular relationship, transaction and applicable compliance requirement.

12. Sending Sensitive Documents Safely

Identity documents, banking information, addresses and company or trust documents can contain sensitive information.

Before sending these documents electronically, clients should confirm that the request is genuine and that they are using the correct Fabulous Homes communication channel.

• Be cautious of unexpected document requests.
• Check the sender before replying with sensitive information.
• Verify unusual instructions through a trusted contact method.
• Never rely solely on an email advising that banking details have changed.
• Contact Fabulous Homes directly if you are uncertain whether a request is genuine.

13. FICA Questions

14. Need Help With Your FICA Requirements?

If Fabulous Homes has asked you to provide verification information and you are uncertain what is required, contact the team before sending unnecessary documentation.