Adv John Simpson, FAIS Ombud
On 19 October 2022, the Financial Sector Conduct Authority (FSCA) published the declaration that Crypto Assets are financial products under the Financial Advisory and Intermediary Services Act, 2002 (Act No. 37 of 2002) (FAIS Act). As a result of the declaration, any person who, as a regular feature of business, renders financial services, i.e. advise and or intermediary services, in relation to crypto assets must either be authorised under section 8 of the FAIS Act as a Financial Services Provider (FSP) or be appointed as a representative of an authorised FSP under section 13 of the Act, and must comply with the applicable FAIS requirements.
In May 2026, the South African Reserve Bank and the FSCA issued a joint communication which clarified that any activity resembling a payment involving crypto assets, that meets the definition of intermediary services, falls under the FAIS Act. Intermediaries facilitating crypto asset transactions, such as payment-type activities and persons giving advice related to crypto assets, must be authorised by the FSCA as FSPs and be licenced under Section 7(1) of the FAIS Act.
The Office wants to emphasise how important it is for consumers to interact with entities registered with the FSCA. A licenced entity will have satisfied the FSCA of its qualifications and competency to provide financial services in respect of crypto assets, and the consumer will also have recourse to submit a complaint with the Office of the FAIS Ombud.
The Office further emphasises that consumers should empower themselves by gaining at least a basic understanding of how crypto assets function.
In the previous financial year, 42% of all complaints received in respect of crypto assets were dismissed without further investigation due to the entity complained of not being licensed by the FSCA. The majority of these entities were domiciled in jurisdictions outside of South Africa.
Since April this year, the Office received 29 complaints related to crypto assets, of which 7 (24%) could not be investigated as the provider was not licensed in South Africa. The majority of the formal cases being investigated relate to complaints about the difficulty of accessing or redeeming the product and the value ultimately received after redemption. Most of these complaints are ultimately dismissed because there is no evidence that the provider is at fault. The complaints appear to arise from a misunderstanding of how crypto assets function and their highly volatile nature. Consumers of crypto assets are strongly encouraged to first empower themselves with information about the nature and risks of transacting with crypto assets so they can make informed decisions.
Should you believe that you have been financially prejudiced because of the financial service rendered to you with respect to a regulated financial product, please lodge a written complaint directly with the service provider. If the complaint remains unresolved after six weeks, you can visit our Complaints Portal at www.faisombud.co.za and select ‘Lodge Complaint’. Alternatively, you may submit a written complaint to info@faisombud.co.za. You can also call our Client Care Centre at (012) 762 5000 or Sharecall at 086 066 3274 for assistance in submitting a complaint.
ENDS
