FIC gets tough with car dealerships

Legalbrief Today Issue 4788

The Financial Intelligence Centre (FIC) intends to place much more stringent reporting obligations on car dealerships because they are regarded as prime targets for illicit financial activity. Business Day reports the focus on motor dealerships comes at a time when the use of one dealership in alleged corruption by Crime Intelligence officers and their use of a secret slush fund was highlighted during evidence to the Zondo Commission of Inquiry into State Capture last week. Senior Hawks detective Colonel Kobus Roelofse told the commission that R143 621.78 had been transferred from the Centurion-based Atlantis Motors dealership to a WesBank Vehicle Finance account in alleged settlement of the amount outstanding on a vehicle registered in the name of N Munusamy, assumed to be journalist Ranjeni Munusamy, in 2008. A total of 16 car dealers –including Atlantis – were fined a combined amount of about R12m by the FIC in 2018/2019 for failing to submit cash threshold reports, which refer to single transactions that exceed the threshold amount. All such transactions have to be reported to the FIC. The existing cash threshold for all transactions of R25 000 will be changed in 2019 to all transactions of R50 000. During the course of 2019/2020 motor vehicle dealerships will be reclassified as accountable institutions.

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