The Financial Sector Conduct Authority (FSCA) has imposed an administrative penalty of R2 113 225 on Mr. Ashley Mmachewe Mphaka (Mphaka) and debarred him for a period of 20 years. The regulatory action followed an investigation by the FSCA in respect of Greyshore Investments (Pty) Ltd and Mphaka.
The FSCA has handed its investigation report over to the South African Police Services (SAPS). The FSCA will actively assist the SAPS if requested.
The findings of the FSCA investigation include that Mphaka solicited deposits from members of the public with the promise to manage their trading account/s and/or trade on their behalf. The FSCA found that Mphaka contravened section 7 of the Financial Advisory and Intermediary Services Act No. 37 of 2002 by rendering financial services without being duly authorised to do so. Mphaka further contravened section 139 of the Financial Sector Regulation Act No. 9 of 2017 by failing to cooperate with the investigators during the investigation.
Members of the public are strongly discouraged from conducting financial services business with persons who are not authorised to conduct such business.
The public is advised to contact an authorised financial services provider if in doubt, and to always check:
- that an entity or individual is authorised by the FSCA to provide financial products and services, including giving recommendations about how to invest.
- what category of advice the person is registered to provide, as there are instances where companies or people are registered to provide basic advice for a low-risk product and then offer advice on far more complex and risky products.
- that the FSP number utilised by the entity or individual offering financial services matches to the name of the FSP on the FSCA database.
What is Fraud? “Fraud” is any activity that relies on deception in order to achieve a gain. Fraud becomes a crime when it is a “knowing misrepresentation of the truth or concealment of a material fact to induce another to act to his or her detriment” (Black’s Law Dictionary). In other words, if you lie in order to deprive a person or organization of their money or property, you’re committing fraud.