Section 14 of the FAIS Act (as substituted by the Financial Sector Regulation Act from 1 April 2018) requires a financial services provider to debar a representative who is no longer fit and proper or has materially contravened the Act. The FSP decides; the FSCA records the debarment and keeps the central register.
When an FSP must debar
- A current or former representative, or a Key Individual of a juristic representative, who no longer meets the fit and proper requirements (section 13(2)(a)), or who has contravened the Act in a material way (section 14(1)).
- The reasons must have arisen, and become known to the FSP, while the person was its representative.
- For a former representative, the debarment must be started within 6 months of their leaving (section 14(5)).
The process
The process must be lawful, reasonable and procedurally fair (section 14(2)). Before debarring, the FSP must:
- Give the person written notice of its intention to debar, with the grounds, the reasons and the terms, including how clients with unconcluded business will be protected.
- Give them a copy of the FSP's written debarment policy.
- Give them a reasonable opportunity to respond.
- Consider the response and decide.
- Tell them the decision in writing immediately, with their right to ask the Financial Services Tribunal for reconsideration and the formal requirements for doing so.
Where the person cannot be found, delivery to their last known email or physical address is enough.
After the decision
| Immediately | Withdraw the person's authority to act for the FSP; remove them from the representative register; protect clients' unconcluded business |
|---|---|
| Within 5 days | Notify the FSCA of the debarment (Debarment Notification Form, Part I) |
| Within 15 days | Give the FSCA the grounds and reasons (Part II) |
| Within 60 days | The debarred person may apply to the Financial Services Tribunal for reconsideration (FSR Act section 230) |
The register of debarred persons
The FSCA keeps and publishes the central register of debarred representatives (section 14(7)), searchable by name or ID number. A debarred person can be appointed again only once they meet the requirements again (section 14(9)). The FSCA has withdrawn its earlier guidelines on the debarment process and on re-appointing debarred representatives, so the Act's text is the guide.
Debarment by the FSCA
Separately, the FSCA may itself debar a person under section 153 of the Financial Sector Regulation Act for a material contravention of a financial sector law or an enforceable undertaking, or for helping another to contravene. The person gets notice and one month to respond; the debarment runs for a stated period and lapses automatically, and it is published.
Records to keep
- The written debarment policy.
- The notice of intention, the person's response, the decision and the notice of the decision, with dates.
- The register removal and the FSCA notifications (Part I and Part II), with dates against the 5- and 15-day limits.
Sources
FAISPro: fais compliance and representative register
Representatives under FAIS: fit and proper, CPD, supervision, debarment, Key Individuals, FSCA register.
FAISPro details →A summary for employers and practitioners, not legal advice. The regulator's and the legislation's own text govern.