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FICA

What is it and how does it affect you?

The Financial Intelligence Centre (FICA) was formulated to combat money laundering activities. This council imposes specific duties to institutions which could be used for money laundering purposes. South Africa has joined international efforts to prevent money laundering by stipulating laws to help financial institutions comply with the country's international obligations to fight organized crime and terrorism. FICA sets standards and provides clear stipulations to banks and other institutions, as well as to professionals such as estate agents, brokers, attorneys and insurance companies. Customer identification plays a crucial element in the control and prevention of money laundering. As of the 1st July 2003, banks are required to obtain certain information and supporting documentation from new customers before accounts can be opened. In addition to this FICA also requires banks to inspect their existing customers with regards to residential status and identification.

In accordance with FICA stipulations (UH) must implement reasonable measures for us to know who our customers are and to prevent criminals from using false or stolen identities to gain access to our services. (UH) also aids the bond and transfer attorneys to obtain the necessary documentation from the client to ensure that they are FICA compliant before registering the bonds and transferring the land. UH endeavor to submit all required FICA documentation prior to approval, to determine our clients authenticity and to speed up the overall process.

Prior to any interviews we require a copy of either of these to determine authenticity:

Identity Document issued by the Republic of South Africa
Valid Passport (if foreign national)

In addition to an Identity Document, you will also need to provide us with proof of your residential address. You can provide any of the following documents, clearly indicating your name and residential address (not postal address

A utility bill, such as water, electricity or rates (not less than 3 months old)
A bank statement or financial statement from a financial institution
A copy of a signed lease agreement (not less than 1 year old)
A municipal rates and taxes invoice (not less than 3 months old)
A mortgage statement from a financial institution (not less than 6 months old)
A telephone account i.e. land-line or cell phone account (not less than 3 months old)
An official tax return/tax assessment (not less than 1 year old)
Official correspondence from the South African Revenue Services ("SARS") (not less than 3 months old)
A recent life insurance policy issued by an insurance company
Correspondence from a body corporate or share-block association (not less than 3 months old)
A valid television license document
A recent short –term insurance policy document or a short-term insurance renewal letter (not less than 1 year old)
A retail account statement/invoice (not less than 3 months old)
Where the person lives in any type of residence (e.g. Hostel/barracks) a letter from the administration department of such residence on an official letterhead is required.

How the NHBRC helps you:

The NHBRC:

Closely monitors the quality standards of the home building industry.
Provides financial assistance to those consumers who have property registered with the NHBRC, in terms of major structural defects which may occur should a builder fail to adhere to the stipulated building requirements.
Grows and sustains the warranty monetary reserve in order to remain financially secure and aid the consumers.
Educate housing consumers and home builders regarding their rights and obligations.
Provide excellent customer care.
Probuild is a long standing registered member of the NHBRC, who assists in upholding high standards and level of service expertise. Over the past 15 years Probuild has successfully registered over 6000 houses with the NHBRC, ensuring that clients can enjoy peace of mind.

Propbuild, together with OnTrack Project Management team of experts ensure that all contractors, workers and staff adhere and abide by the stipulations required by the NHBRC.

The National Credit Act

The National Credit Act (NCA) sets a framework for every type of credit transaction. The NCA came into effect on June 1, 2007 and its implementation radically changes the way in which consumers borrow and financial institutions lend.

The Act is aimed at protecting consumers from irresponsible debt levels by educating and assisting consumers in making informed choices and promotes a fair, competitive and sustainable credit market.

The Act introduces new rights for consumers, allowing consumers to make informed decisions before buying goods and services on credit. It also places a greater responsibility on credit providers to refuse to give you credit if you cannot afford it and for the first time in South African history, it will regulate the way credit bureaus do business.

A national database of credit agreements is being set up and will be maintained by the National Credit Regulator (NCR) who will receive information about credit agreements from the credit providers and credit bureaus.

The idea behind the National Credit Register is that all outstanding loans and other credit obligations will be listed on this register. Prospective credit providers will be able to check this database to assess whether you can afford to take on more debt before giving you a loan or extending credit to you.

How the NCA Affects you when applying for mortgage:

Banks previously used a borrower's gross income (applicant and co-applicant) to determine whether they can afford the monthly repayments. Now that the act has been implemented, the banks will have to check all forms of credit that the client has available to them. The responsibility falls on the applicants to give a truthful and accurate account of their current financial profile with specific regards to income, expenditure, assets and liabilities.

The lending stipulations of banks have changed and they have become more stringent with their qualifying criteria. Therefore the way in which banks manage risk has also changed. One bank might accept an application previously declined by another. In this instance the bank may use a price mechanism to adjust for the level of risk i.e. less discount on the prime lending rate to the applicant.

The NCA stipulates that as a consumer you have the right to:

Apply for credit.
Be protected against discrimination in the granting of credit.
Be informed of the reason why your application for credit was refused, upon request.
Receive a credit agreement in plain and understandable language.
Receive a copy of your credit contract and a replacement copy when you request one. For more information click here www.ncr.org.za

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