1. Do you know your clients? (Guide on working with FICA) 2. IEA Western Cape Diary 3. EAAB exam booking reminder



IEA News – 1 May 2004 Do you know your clients? The financial intelligence system was introduced into South Africa in 2003, and every estate agent and agency is required by law to implement it. Yet, to judge from enquiries which we receive, a lot of them are still in the dark about what they have to do - and about the tremendous penalties for non-compliance. To shine some light into the darkness, here are the basics. Every estate agency firm (and its principals) must: · know what the Financial Intelligence Centre Act and the Money Laundering Control Regulations require them to do, · devise procedures for implementing the Act and the Regulations, · produce a manual setting out those procedures, · train all its agents and staff in how to comply with those procedures, and · appoint a compliance officer to monitor the agents and staff and make sure that they comply. The Estate Agency Affairs Board has published an excellent handbook which can be obtained from the Board's website www.eaab.org.za We recommend that every estate agency obtain a copy. Principals who don't want to devise their own procedures and forms and writing their own manual can simply "adopt" the EAAB handbook as it stands. Probably the most important requirement is "know your client". In practice, this means that the estate agent must establish exactly who his client is, verify that client's identity, and keep a record of that client's identity for at least five years. Who is the client? As far as the estate agency industry is concerned, the client is the person (or organisation) which pays the estate agency for its services. In most cases, therefore, the client will be the seller or the landlord. What are the actual steps involved in verifying someone's identity? The simplest method that we know is the following: whenever an estate agent lists a property for sale or to let, he should: · take a photocopy of the client's identity book, which will show the client's full names, ID number, date of birth and citizenship, and · verify that the client actually lives where he says he does (in many cases, the client's home address is the property which the estate agent is listing, so the estate agent can verify the address by the evidence of his own eyes), and · take the photocopied ID book back to the office and put it into the filing system. That's it. At some point in the future, it may also become necessary to ask a client for a copy of a SARS document showing his income tax reference number, but that is not required right now. The estate agent must verify the identity of every individual who is his actual client, or who represents his client. If the client is working through a company or a CC or a trust, then the estate agent must verify its registration details and other particulars as well. While "know your client" is a very important requirement, there is, of course, far more to the Financial Intelligence Centre Act than this. We have been running workshops for IEA members, and will be running more in the future. Estate agents (and especially principals) who have not yet attended one should do so at the first opportunity. Useful FICA sources You can obtain the EAAB's Best Practice Guidelines handbook (free of charge) through the EAAB website: www.eaab.org.za. The Financial Intelligence Centre also has a website with useful information, including downloadable copies of the Financial Intelligence Centre Act and the Money Laundering Control Regulations: www.fic.gov.za. Alternatively, you can buy the Financial Intelligence Centre Act and the Money Laundering Control Regulations from the Government Printer (tel 021 465 7531). IEA WESTERN CAPE DIARY Forthcoming courses and events: Advanced Commercial & Industrial Course* 4 - 5 May Property Development Course 8, 15, 22 and 29 May EAAB Exam Course* 10 - 14 May (English, daytime) 18 May - 14 June (English, evenings) 24 - 28 May (Afrikaans, daytime) Principals' and Managers' Breakfast (Guest speaker: labour consultant Michael Bagraim on labour/contract issues) 12 May Basic Training Workshop 19 May * accredited by the Services SETA ______________________ Enquiries and bookings: phone 021 531 3180 DON'T FORGET TO BOOK FOR THE BOARD EXAM! If you want to write the Estate Agency Affairs Board exam on 17 June, you need to enrol with the EAAB by not later than 14 May. Enrolment is your responsibility: the IEA cannot do it for you - we just provide the training course. Phone the EAAB at 011 880 9994, or go to their website: www.eaab.org.za