The 10-year debarment imposed on the director of two FSPs that sold financial products when they were not authorised by the FSCA was excessive, the Financial Services Tribunal (FST) has found.
In December 2022, the FSCA fined Oversurance Broker Services (Pty) Ltd R150 000, and it fined Oversure Broker Services (Pty) Ltd R100 000.
According to the Authority, Oversurance sold two financial products via Oversure’s call centre between 23 April 2015 and 8 May 2017, before it was a registered FSP. Oversure collected the premiums for the two products on behalf of Oversurance before it was registered as an FSP.
The FSCA debarred Terrence Ramiah, the sole director of both Oversurance and Oversure, for 10 years. Oversurance and Oversure ceased trading in 2019 and 2020, respectively.
Ramiah applied to the FST for his debarment to be reconsidered, and Oversurance and Oversure applied for the fines to be reconsidered.
The applicants did not contest contravening the FAIS Act and the Long-term Insurance Act but the length of the debarment and the amount of the fines.
The FST consolidated the decisions in the three matters into one decision.
In his submission to the tribunal, Ramiah said:
- He was married with two minor children, took care of his mother, and was the family’s sole breadwinner;
- He has no previous convictions, pending cases or previous charges, and this was a first offence;
- He co-operated fully with the FSCA’s investigation;
- He was remorseful and would agree to undergo any required further training; and
- The contraventions occurred more than six years ago, and no one suffered any loss.
The FSCA told the tribunal that:
- Ramiah’s submissions were nothing more than “an appeal for compassion and pity”, which the FST should not consider;
- It should consider the interests of the investing public; and
- Ramiah had not placed any compelling factors before the tribunal to show that the Authority had misdirected itself in imposing the 10-year debarment.
The tribunal saw no reason to interfere with the fines.
However, the FST was not satisfied that the debarment period was appropriate, saying it seemed to be excessive compared with debarments imposed by the FSCA in other matters where the circumstances were “far more egregious”.
The tribunal ordered that the debarment be referred to FSCA so it could reconsider an appropriate period of debarment.
