MEMORANDUM OF UNDERSTANDING

THE FINANCIAL INTELLIGENCE CENTRE

and

THE SOUTH AFRICAN RESERVE BANK

&

THE PRUDENTIAL AUTHORITY

2018

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MEMORANDUM OF UNDERSTANDING

The Financial Intelligence Centre
represented by Adv. X J Khanyile
in her capacity as the Director of the Centre

and

The South African Reserve Bank & The Prudential Authority
represented by Mr E L Kganyago
in his capacity as the Governor of the SARB & Chairperson of the Prudential Committee

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Preamble

Whereas the Constitution of the Republic of South Africa, 1996, encourages the co-operation between government departments and organs of the state based on mutual trust and good faith;

And whereas the Financial Intelligence Centre Act 38 of 2001 directs the Financial Intelligence Centre to combat money laundering and the financing of terrorist and related activities; to make information collected by it available to competent authorities to facilitate the administration and enforcement of the laws of the Republic; to make reasonable procedural arrangements and safeguards regarding the furnishing of confidential information; to make provision for the roles and responsibilities of the Financial Intelligence Centre and supervisory bodies in supervising and enforcing compliance by accountable institutions with the provisions of the Financial Intelligence Centre Act 38 of 2001; to co-ordinate with supervisory bodies in the exercising of powers and performing of functions so as ensure consistent application of the provisions of the Financial Intelligence Centre Act 38 of 2001;

And whereas the South African Reserve Bank is a mandated entity as listed in section 40(1)(aF) of the Financial Intelligence Centre Act 38 of 2001 and thus authorised to receive confidential information held by the Financial Intelligence Centre;

And whereas the South African Reserve Bank is a supervisory body responsible for supervising and enforcing compliance with the provisions of the Financial Intelligence Centre Act 38 of 2001;

And whereas the provisions of the Financial Sector Regulation Act 9 of 2017 requires the South African Reserve Bank to protect and enhance financial stability; to restore or maintain financial stability occasioned by a systemic event; monitor and review any risks to financial stability and to take steps to mitigate such risks; to provide for co-ordination, co-operation, collaboration, assistance, consultation and exchange of information between the South African Reserve Bank, the Prudential Authority and the Financial Intelligence Centre;

And whereas sections 40(3) and 45(1D) of the Financial Intelligence Centre Act 38 of 2001 and sections 27, 77 and 251(3)(e) of the Financial Sector Regulation Act 9 of 2017 require the South African Reserve Bank, the Prudential Authority and the Financial Intelligence Centre to conclude memorandums of understanding to facilitate the fulfilment of their concomitant legislative responsibilities and obligations;

Now therefore the Financial Intelligence Centre, the South African Reserve Bank and the Prudential Authority hereby enter into this Memorandum of Understanding with the purpose of regulating matters of common interest, mutual co-operation, collaboration, assistance and exchange of information, in the fulfilment of their concomitant legislative responsibilities and obligations as prescribed by law.

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1. Definitions

In this Memorandum of Understanding and in the annexures thereto, unless the context indicates or requires otherwise:

• “Accountable Institutions” means an institution as referred to in Schedule 1 to the Financial Intelligence Centre Act 38 of 2001;

• “Administrative Sanction” means an administrative sanction contemplated in section 45C of the Financial Intelligence Centre Act 38 of 2001;

• “Authorised Officer” means an official designated by the South African Reserve Bank and any department thereof, to request and/or receive confidential information from the Financial Intelligence Centre in terms of section 40 of the Financial Intelligence Centre Act 38 of 2001;

• “Banks Act” means the Banks Act 94 of 1990;

• “Centre” means the Financial Intelligence Centre established in terms of section 2 of the Financial Intelligence Centre Act 38 of 2001;

• “CEO of the PA” means the Chief Executive Officer of the Prudential Authority appointed in terms of section 36 of the Financial Sector Regulation Act 9 of 2017;

• “Competent Authorities” means all authorities listed in section 3(2)(a) of the Financial Intelligence Centre Act 38 of 2001;

• “Consultative Committee” means the Committee established under this Memorandum of Understanding to facilitate consultation on relevant strategic issues pertinent to the financial services industry;

• “Director” means the Director of the Financial Intelligence Centre;

• “FATF” means the Financial Action Task Force;

• “FIC Act” means the Financial Intelligence Centre Act 38 of 2001;

• “Financial Crime” includes an offence in terms of:
  (a) a financial sector law,
  (b) sections 2, 4, 5 and 6 of the Prevention of Organised Crime Act 121 of 1998,
  (c) the Financial Intelligence Centre Act 38 of 2001,
  or
  (d) section 4 of the Protection of Constitutional Democracy against Terrorist and Related Activities Act 33 of 2004;

• “FinStab” means the Financial Stability Department of the South African Reserve Bank;

• “Financial Sector Legislation” includes the financial sector law as defined by the Financial Sector Regulation Act 9 of 2017, the National Credit Act 34 of 2005, the National Payment System Act 78 of 1998, Currency and Exchanges Act 9 of 1933 and the Financial Intelligence Centre Act 38 of 2001;

• “Financial Sector Regulator” means:
  (a) the Prudential Authority,
  (b) the Financial Sector Conduct Authority,
  (c) the National Credit Regulator but only in respect of Parts 2, 3 and 5 of Chapter 2 and Parts 1, 2 and 3 of Chapter 5 of the Financial Sector Regulation Act 9 of 2017,
  or
  (d) the Financial Intelligence Centre but only in respect of Parts 2, 3 and 5 of Chapter 2 and Parts 1, 2 and 3 of Chapter 5 the Financial Sector Regulation Act 9 of 2017;

• “FinSurv” means the Financial Surveillance Department of the South African Reserve Bank, authorised to regulate the Exchange Control Regulations, issued in terms of section 9 of the Currency and Exchanges Act 9 of 1933;

• “FSR Act” means the Financial Sector Regulation Act 9 of 2017;

• “Governor” means the person appointed under section 4 or 6(1)(a) of the South African Reserve Act 90 of 1989, as the Governor of the South African Reserve Bank;

• “Inspection” means an inspection in terms of section 45B of the Financial Intelligence Centre Act 38 of 2001 and/or an onsite inspection in terms of the Financial Sector Regulation Act 9 of 2017;

• “Law Enforcement Authority” means the authority, service or body contemplated in section 3(2)(a) of the Financial Intelligence Centre Act 38 of 2001;

• “MRC” means the Monitoring Review Committee as established by this Memorandum of Understanding;

• “MOU” means this Memorandum of Understanding entered into in compliance with section 45(1D) of the Financial Intelligence Centre Act 38 of 2001 and sections 27 and 77 of the Financial Sector Regulation Act 9 of 2017;

• “National Credit Act” means the National Credit Act 34 of 2005;

• “NPS Act” means the National Payment System Act 78 of 1998;

• “NPSD” means National Payment System Department of the South African Reserve Bank, authorised to perform the functions in respect of the powers and duties contemplated in section 10(1)(c) of the South African Reserve Bank Act 90 of 1989 and the National Payment System Act 78 of 1998;

• “PA” means the Prudential Authority, a juristic person within the administration of the South African Reserve Bank, established in terms of section 32 of the Financial Sector Regulation Act 9 of 2017;

• “Parties” means the Financial Intelligence Centre, the South African Reserve Bank and the Prudential Authority;

• “POCA” means the Prevention of Organised Crime Act 121 of 1998;

• “POCDATARA” means the Protection of Constitutional Democracy against Terrorist and Related Activities Act 33 of 2004;

• “Prudential Committee” means the committee established in terms of section 41 of the Financial Sector Regulation Act 9 of 2017;

• “Republic” means the Republic of South Africa;

• “Reserve Bank” means the South African Reserve Bank as referred to in section 223 of the Constitution and established in terms of the South African Reserve Bank Act 90 of 1989, a mandated entity as listed in section 40(1) of the Financial Intelligence Centre Act 38 of 2001 and includes the Financial Stability Department, the National Payment System Department, the Financial Surveillance Department and any other Department thereof;

• “Requested Party” means a party to whom a request for information is made in terms of this Memorandum of Understanding;

• “Requesting Party” means a party making a request for information in terms of this Memorandum of Understanding;

• “SARB Act” means the South African Reserve Bank Act 90 of 1989;

• “Standards” means a prudential standard, a conduct standard or a joint standard;

• “Supervisory Arrangement” means the arrangement between the Financial Intelligence Centre and the Prudential Authority, the Financial Surveillance Department and the National Payment System Department, as annexed to this Memorandum of Understanding;