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The South African Reserve Bank (SARB) has imposed a R15.9 million fine on Old Mutual Life Assurance Company for numerous breaches of the Financial Intelligence Centre Act (FICA). Among the violations, the life insurance giant was found to have failed to conduct adequate customer due diligence, which is critical in preventing financial crimes such as money laundering and terrorism financing. The SARB’s action underscores the importance of compliance within the financial sector, and it highlights the continued efforts by regulators to ensure transparency and accountability in financial operations.

Overview of the Violations:

Old Mutual Life Assurance Company’s violations of FICA primarily stem from lapses in conducting proper customer due diligence, which is a cornerstone requirement for identifying and verifying customers’ identities. Adequate due diligence procedures are essential for financial institutions to assess risks, prevent fraudulent activities, and ensure they are not facilitating illicit financial activities.

The SA Reserve Bank noted that Old Mutual’s failure to follow these requirements posed significant risks to the company’s ability to detect and report suspicious transactions. Among the other violations, the company also failed to comply with ongoing obligations for monitoring transactions and ensuring that high-risk clients were appropriately identified and flagged for enhanced scrutiny.