Reserve Bank fines Capitec and Deutsche Bank SA combined R25 million

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The Reserve Bank fined Capitec and the local branch of Deutsche Bank a combined total of R25 million last year for shortcomings in the systems they have in place to combat money laundering‚ the Bank said.

The Bank also announced that deputy governor Kuben Naidoo would take over as registrar of banks from Renee de Wet‚ who will retire as registrar at the end of this year. Naidoo‚ who will serve in both the deputy governor and registrar roles‚ helping to facilitate the transition to the new Twin Peaks regulatory system.

The bank supervision department is responsible for ensuring that banks have systems and measures in place to comply with the provisions of the Financial Intelligence Centre Act on money laundering and terror financing.

The Bank emphasised the decision to impose administrative sanctions on Deutsche and Capitec “was not based on any evidence that Deutsche Bank or Capitec facilitated transactions relating to money laundering and/or financing of terrorism activities.”

However‚ Capitec was fined R5 million for failing to report cash transactions above R24‚999 to the Financial Intelligence Centre in line with the legislation and it was directed to take remedial action.

Deutsche Bank’s “know your customer” measures were inadequate and it was fined R10 million for this and was directed to address deficiencies in its controls and systems related to detecting property related to terrorism.

The Bank Supervision Department report‚ which covers the year to December‚ reports that the total assets of SA’s banking system grew by 15.7% during the year and banks remained solidly capitalised‚ with capital adequacy ratios of 14.2% at end December‚ just slightly down from 14.8% in December 2014. This reflected a slight increase in risk weighted assets across the sector.

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