Leon Greyling, Partner at ICTS Partners – making ESG practical
It is permission to stand between other people’s money and the market – and to be trusted while you do it.
It’s a license to act responsibly, or else….
The Financial Sector Conduct Authority’s 18-year debarment of Eric Wood and Niven Pillay is more than a headline about two former Regiments Capital principals. It is a reminder, written in the hardest ink the regulator owns, that an authorised financial services provider license is not a hunting permit. It is a privilege. It gives a person the legal right to stand between other people’s money and the market – and to be trusted while they do it. It does not give anyone the right to plunder for maximum fees.
That distinction is the whole point of the FAIS regime. When the Authority authorises an FSP, and when it approves a Key Individual, it is saying to the public: this person may advise you, intermediate for you, manage assets for you, because they have been found fit and proper. Honesty and integrity are not optional extras on that form. They are the condition on which the license exists. Lose them, and the license is no longer a permission slip. It becomes evidence.
The FSCA’s investigation into Wood and Pillay considered findings of the State Capture Commission: that between 2009 and 2016 their firm was used as a vehicle for improper payment arrangements and unlawful revenue-sharing around state contracts, including work linked to Transnet. The regulator’s conclusion was administrative, not a criminal verdict – but it was blunt. Their conduct adversely affected their fitness and propriety, “particularly in relation to the requirements of honesty and integrity applicable to key persons.” Eighteen years off the industry is the price of that finding. The days when a well-connected advisory firm could treat SOE mandates as a private quarry, and treat fitness-and-propriety as a paperwork exercise, are supposed to be over.
They should have been over long before this.
Every FSP owner and every Key Individual still licensed should read the order as if their own name were on it. The same applies to so-called independent directors and trustees – the appointment is a privilege that comes with responsibility, not a free lunch and pay cheque. Compliance is not a cost centre you staff after the fees have landed. It is the operating system of the privilege you hold. FICA exists so that the industry is not a laundry. FAIS exists so that advice is suitable, conflicts are managed, and clients are treated fairly. The General Code is not a suggestion. Board Notice 194’s honesty, integrity and good standing requirements do not lapse because the client is a state-owned company and the invoice is large. Joint Standard 2 of 2024 on cybersecurity and cyber resilience exists because the data and systems that hold other people’s wealth are now a battlefield; a firm that cannot protect information cannot claim to protect clients. The laws are not there to irritate producers. They are there to protect the people we serve.
A culture of “me first” cannot survive that stack of obligations. It never deserved to. The adviser who treats a licence as a ticket to extract, the KI who signs off a structure they would not explain to their own family, the owner who budgets for the fine instead of the control – all of them have mistaken a public trust for a private entitlement. State Capture made that mistake at industrial scale. Smaller firms make it in quieter rooms every week: unsuitable products, sloppy FICA, ignored Treating Customers Fairly outcomes, cyber hygiene left to the intern. It’s not too late to clean up your act.
Consequences now have a face and a date. Debarment is industry-wide. It is not a slap on one firm’s letterhead. It is a lock on the profession. Asset restraints, civil claims and, where the evidence supports it, criminal process sit behind the administrative action. The lag between Zondo and this FSCA order will frustrate many South Africans. It should not comfort anyone still licensed. Delay is not immunity.
If you hold an FSP license, you were not awarded a fortune. You were lent a role. Serve the client. Take FICA, FAIS and Joint Standard 2 seriously enough to fund them, capacitate them and lose sleep over them. Change the culture from extraction to stewardship – or the stamp will find you too. Eighteen years is a long time to discover that the license was never yours to abuse.
ENDS
