The Financial Services Tribunal (FST) has upheld the debarment of a representative who falsely claimed that a client signed application documentation via an in-person link.
Joash Daniels Nadasen’s association with Sanlam Life Insurance did not last long. He signed an independent contractor agreement with the FSP in February last year and resigned in July. He was contracted to market and promote Sanlam’s financial products.
One of Nadasen’s clients lodged a complaint, alleging he never saw the application documents for a product signed through Sanlam’s e-sign process. The client claimed Nadasen asked him to provide a one-time PIN to finalise the application.
This prompted a forensic investigation, which found that Nadasen had misled Sanlam by stating the documentation was signed in-person, despite evidence to the contrary. The investigation concluded that Nadasen “demonstrated dishonest behaviour when he indicated that the application documentation was signed via an in-person signing link knowing the client was not in his presence”. This conduct violated section 2 of the General Code of Conduct, which mandates honesty and integrity.
The forensic report didn’t stop there – it recommended debarment proceedings. Although two other irregularities surfaced during the probe, they could not be substantiated because the clients could not be unreached.
Nadasen resigned in July, before the investigation concluded, but Sanlam pressed forward, issuing a notice indicating possible debarment in October. This notice cited breaches of both the FAIS legislation and Sanlam’s Code of Ethics, questioning Nadasen’s fitness to serve as a financial representative. Despite Nadasen’s further representations, Sanlam issued a notice of debarment in November.
Seeking to overturn this, Nadasen filed for reconsideration with the Tribunal, arguing the decision rested on a “misunderstanding”. He said the client was his brother-in-law, alleging the complaint stemmed from personal animosity and was fabricated.
Nadasen insisted the client completed the signing process in his presence at his wife’s parents’ home. However, Sanlam countered this with an email from the client to the investigator, attaching WhatsApp messages where Nadasen wrote, “Howsit bru please give me the otp you received from Sanlam on your watsapp.”
The Tribunal said the FAIS Act provides a strict framework for maintaining integrity in the financial sector. Section 14(1)(a) empowers providers such as Sanlam to debar representatives who fail to meet the “fit and proper” requirements or materially violate the Act. These requirements, detailed in section 13(2)(a), demand competence and adherence to standards of honesty and integrity – qualities explicitly highlighted in section 6A(2)(a). The law leaves no ambiguity: a representative must embody these traits, or they cannot serve, as reinforced by section 13(1)(b)(iA). Procedurally, section 14(3)(a) ensures fairness, requiring written notice of intent, access to debarment policies, and a chance to respond before action is taken, while section 14(3)(c) mandates prompt notification of the outcome and appeal rights.
The Tribunal said Nadasen’s submission that the debarment stemmed from a “misunderstanding” was without merit. It pointed to inconsistencies, particularly between Nadasen’s narrative and the WhatsApp message to the client. This evidence undermined Nadasen’s assertion of an in-person signing, exposing a breach of integrity that contravened the FAIS legislation.
“Clearly, the applicant has not been consistent in his version of events,” the FST said.
Once Sanlam confirmed the facts, debarment wasn’t optional – it was required.
The Tribunal also confirmed that Sanlam followed the procedural steps demanded by the FAIS Act.
I believe that Sanlam has made efforts to obscure their actions. Forensic investigators often seek to implicate intermediaries, as their compensation is tied to the volume of fraudulent cases they can substantiate. When a new intermediary joins Sanlam, they are assigned a vesting or development manager responsible for overseeing compliance before cases are submitted for processing. Why was this issue identified solely by the client? It should have been addressed by the manager. Consider the numerous new business cases that fall under this manager’s supervision and oversight. Notably, clients are not required to be present to sign documents through Sanlam’s e-signature system, QuicklySign. The manager is expected to review the audit trail, which includes the client’s IP address, phone number, and email. However, this manager neglected their responsibilities, as the intermediary was under their supervision. Sanlam appears to be shielding this manager, which is detrimental to the intermediary, suggesting an internal conflict. The intermediary should seek legal recourse, presenting witnesses to demonstrate Sanlam’s negligence in supervision and to highlight the personal bias they faced. The Financial Services Tribunal seems increasingly disorganized, lacking the necessary knowledge to advocate effectively for anyone. As a result, this intermediary’s career in financial services, whether in insurance or banking, is effectively over, leading to significant reputational harm. Legal action against both the FST and Sanlam is warranted, as the situation raises serious ethical concerns. Sanlam’s actions suggest a deliberate effort to protect their own interests.
I understand the part where the intermediary is acting under supervision and that there should be direct and indirect supervision on new business applications submitted by the intermediary. However, I would like to comment on the practicality of the manager conducting an audit on all new business applications submitted by intermediaries at large. The relationship between an employer and employee in my understanding is based on trust. Intermediaries are trained to discharge their duties with care, honesty and with integrity. It might have been that at point of submission by the intermediary. The new business was sound.
Dear All,
I hope this message finds you well. I am writing in response to the ongoing case and the allegations surrounding my actions as the intermediary in question. I would like to clarify my position and provide further insight into the matter at hand.
The case concerns allegations where I, as the intermediary, used an OTP to conduct an in-person sign-in, which, it is claimed, was not the correct procedure. However, I would like to point out that the supervisor involved in this case provided me with the OTP to carry out this action on his behalf. The supervisor openly confessed to this arrangement in an email to the company, which I only became aware of when I raised the issue with the tribunal. This email was subsequently presented as evidence of my alleged misconduct.
It is important to note that this supervisor, with over two decades of experience in the industry and full qualifications, has not faced the same repercussions for this action to my knowledge, despite his direct involvement. In contrast, I, with only five years of experience and fully qualified to sell short-term products, am facing serious consequences.
I trust this clarification provides a better understanding of the context, and I look forward to further discussions