They are Worldwide Investments, Dynamite Investment Group and Fern Finance, which are not authorised via the Financial Advisory and Intermediary Services Act 2002 (FAIS) to provide any financial advice and intermediary services, the regulator said.
The FSCA said Worldwide uses a WhatsApp group and takes money from the members of the public and promises to trade in forex and “when it’s time to pay back they block you”.
It is neither an authorised Financial Services Provider (FSP) nor a representative of an authorised FSP and there are no records of application to become authorised as one.
Dynamite Investment Group
The South African regulator received information that there is a company called Dynamite Investment Group which operates in the Vaal area.
The firm is promising returns of 10% for a one-month investment and up to 40% for a 12-month investment.
People who have invested with Dynamite Investment Group have lost their funds without receiving any return on investment.
Based on the information received, the FSCA has reason to believe that Dynamite Investment Group is rendering financial services without authorisation.
Any entities or individuals doing so are acting in contravention of the FAIS Act, which carries a fine not exceeding ZAR10m (£523,000, $669,000, €606,000) or a period of imprisonment not exceeding 10 years.
Fern’s licence was withdrawn on 10 October 2019 for failure to comply with the provisions of the FAIS Act and for contravening section 7(1) of the Short-term Insurance Act No 53 of 1998 (STIA).
The FSCA also imposed an administrative penalty of ZAR3.5m.
Charlton Lungisani Sikuza, the key individual of Fern, is banned for a period of 10 years from providing or being involved in the provision of financial services.
The FSCA stated Sikuza “does not comply with the personal character qualities of honesty and integrity outlined in the fit and proper requirements of all authorised FSP representatives, as he allowed Fern to contravene the STIA”.
The regulator has ordered both Fern and Sikuza to immediately cease issuing guarantee policies.