The Financial Sector Conduct Authority (FSCA) warns the public to be cautious when conducting financial services and insurance business with Mr. Frank Kabelo Mashilo (Mr. Mashilo) and Mashram United Funeral Undertakers’ Compliance Organisation (MUFUCO).
The FSCA received a complaint that Mr. Mashilo and MUFUCO may be issuing insurance policies to members of the public which were possibly not underwritten by an authorised long-term insurer. The FSCA found that MUFUCO is not registered with the Companies and Intellectual Property Commission (CIPC).
Mr. Mashilo could not be contacted for comment. The FSCA further attempted to visit the premises indicated as the registered residential address of Mr. Mashilo, however, the residents had no knowledge of MUFUCO and the whereabouts of Mr. Mashilo.
Without commenting on the business of Mr. Mashilo, MUFUCO or their products and services, the FSCA points out that for a company to issue insurance policies in South Africa, it must be authorised by FSCA and the Prudential Authority (the PA).
Conducting financial services business or insurance business without a license is a criminal offence. Mr. Mashilo and MUFUCO are not authorised and does not hold any license from the FSCA and/or the PA to conduct financial services and/or insurance business.
The public is advised to be on the lookout for certain tell-tale danger signs when approached by persons offering attractive investment opportunities. These red flags include:
- Unrealistic or exaggerated returns
- Offers made on social media platforms
- Requirements to pay for services upfront
- Requirements to pay more money to have your investments returned
- Requirements to pay for training
- Claims that you must act and pay urgently i.e. creating a sense of urgency
- Vague information about the investment product.
Members of the public may use one of the following methods to confirm whether a service provider or person is authorised to act as an FSP by the FSCA, including to verify their FSP number:
- Toll-free number: 0800 110 443
- Online search for authorised financial institution by license category: https://www.fsca.co.za/Regulated%20Entities/Pages/List-Regulated-EntitiesPersons.aspx
- Online search for a financial institution that is an authorised FSP in terms of the FAIS Act: https://www.fsca.co.za/Fais/Search_FSP.htm
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.