The Financial Sector Conduct Authority (FSCA) has reached an agreement with the current directors Andrew Cunningham-Moorat and Mr Brett Bukes, and the former director, Craig Massyn, of Praesidium Advisory.
An enforceable undertaking has been signed by all the parties and accepted by the FSCA.
This comes months after the FSCA provisionally suspended the financial services provider (FSP) licence of Praesidium Advisory Services due to information the regulator received about the firm, which indicated that it was misusing its FSP licence.
Enforceable undertaking
In the terms of the agreement, the firm has agreed to repatriate all Praesidium client funds held offshore to a South African bank account for distribution to its clients.
The parties also agreed to appoint a statutory manager to distribute these funds.
These steps were taken by the FSCA in an attempt to preserve any clients’ funds that may still be available.
The FSCA said that “it does not mean that clients will recover their investments in full”.
“In fact, based on the investigation to date, there is a strong indication that the majority of clients’ funds is unlikely to be recovered.”
The South African regulator is continuing with its investigation into the actions of Praesidium and its directors and will consider regulatory and enforcement action once the investigation is completed.
Licence
On 27 May 2020, the FSCA provisionally suspended the FSP licence of Praesidium Advisory Services.
The FSCA’s decision was made after it received information that the firm might be misusing its FSP licence by operating an unapproved foreign collective investment scheme and soliciting investments from members of the public.
The public’s attention was further drawn to the fact that the Praesidium Global Fund and/or the Praesidium Mauritius Managed Fund, which were being offered by Praesidium Advisory to members of the public, were not approved by the FSCA.
It also said that Praesidium Advisory was reportedly offering returns as high as 40% per annum.
The FSCA said that the entity under investigation is not linked to Praesidium Capital Management, a licenced financial service provider.
