The Financial Sector Conduct Authority (FSCA) has fined Brite Advisors South Africa ZAR 10m (£506,100, $639,600, €596,000) and DeVere Group chief executive Nigel Green (pictured) ZAR 2.5m.
It follows an investigation which found that Brite Advisors – formerly known as DeVere Investment South Africa and DeVere SA Acuma – “contravened various financial sector laws” between February 2010 and August 2015.
Given that the businesses were sold in November 2019, Brite refers to the former DeVere entities.
The FSCA said, having considered representations from Brite, it “decided to impose an administrative penalty of ZAR 10m” and has withdrawn Brite’s financial services provider (FSP) licence.
The watchdog added that its investigation “also revealed that Mr Green was a director of [the company] from 2008 until 2015 and in his capacity as a director, he caused and/or permitted the contraventions”.
The FSCA said it found “Green contravened/failed to comply with various financial sector laws which impacts on his fitness and propriety”.
Having considered representations from Green, it decided to impose an administrative penalty of ZAR 2.5m and “debar [him] for a period of five years”.
A spokesperson from DeVere told International Adviser: “We are shocked and disappointed by the South African regulator’s decision. It appears that, unfortunately, the regulator has chosen to ignore obvious, unambiguous and crucial facts relevant to this case.
“We will be appealing this decision and are confident that the Financial Services Tribunal will recognise the abundance of evidence in support of Mr Green’s position.”
Andre Vorster, chief executive of Brite Advisors South Africa, told International Adviser: “The order was issued by the FSCA, in respect of FSP 23719, previously held by DeVere Acuma and now held by Brite Advisors South Africa (Pty) Ltd. The order is based on the findings of the investigations of the authority, regarding alleged contraventions by DeVere Acuma, through their business conduct during the period of 2010 to 2016.”
He added: “The executive team of Brite Advisors, assisted by its legal team, are dealing with the matter in an appropriate manner. We request clients not to be alarmed as this will not have any impact on their investments with the relevant product providers. We believe the matter will be concluded soon.”
Vorster added that advisers and clients will be “kept informed as we progress to the final solution” with a formal update due to be published soon.
“Further to that, Brite Advisors South Africa is dealing with the matter appropriately to ensure no material interruption of the South African business.
“The immediate step would be to make contact with both the Regulator and the Financial Services Tribunal as allowed for in terms of the relevant legislation, more specifically in terms of section 230 of the Financial Sector Regulation Act 9 of 2017, in order to agree on the best way to conclude the matter.”
