December 9, 2021

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Financial body under pressure to root out maladministration in wake of damning report

2 min read
Financial body under pressure to root out maladministration in wake of damning report

Financial body under pressure to root out maladministration in wake of damning report

Pressure is mounting on the Financial Sector Conduct Authority (FSCA) to release a report into allegations of irregularities from the Private Security Sector Provident Fund (PSSPF).

The report contains details of how the life savings of security guards were looted and spent on overseas trips, hotels, donations and cars.

In response to media reports, the FSCA said that while it could not release its investigation reports to the public, in line with the Financial Sector Regulation Act, the matter was receiving due attention.

The Association of Private Security Owners of South Africa (Tapsosa) said the feedback from the conducting authority was unacceptable, given the magnitude of the allegations and their implications.

The association, which represents black employers whose workers are potentially affected by the claims, said that had the FSCA intervened earlier, it could have intercepted the looting.

“We have, for years, been calling on the FSCA to investigate the activities of the PSSPF. This includes engaging Parliament, calling on the portfolio committee on police responsible for the security industry, to ensure that the activities of the PSSPF are attended to,” said Tapsosa president Jones Maphalaphathwa.

The FSCA reportedly conducted a supervisory on-site inspection of the PSSPF in 2017.

Following its findings from the inspection, the sector conduct authority filed an application for the appointment of curators to take control of the business.

While details of the forensic report remain classified, the appointment of administrators in 2018 suggests that the provident fund scheme may have been mismanaged at the very least.

Tapsosa said the continued secrecy surrounding the findings would hamper accountability.

“The FSCA should release the forensic report that would reveal the deeper intricacies of the shenanigans on the irregularities that led to the abuse of the workers’ savings.

“Without transparency, those responsible for the crimes will evade accountability,” said Maphalaphathwa.

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