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The Financial Intelligence Centre (FIC), which is an entity of the Department of Finance, has identified the vehicle dealership industry to be delinquent with regard to their obligations to report transactions in cases where customers buy value-end vehicles in cash. 

The FIC Director, Adv Xolisile Khanyile, informed the members of the Standing Committee on Finance that her entity monitored the sector closely in the 208/19 financial year and imposed sanctions to the value of R12 million on non-compliant dealers. The FIC believes that buying value-end vehicles in cash comes as a result of corruption or money laundering.

The intelligence centre appeared before the committee on Wednesday to make a briefing on its financial and performance report. It has received unqualified audit opinion with findings in the 2018/19 financial year.   

Adv Khanyile said the FIC forms part of the law enforcement value-chain, in which it generates intelligence reports that are used by the police, prosecutorial authorities and other investigative authorities in the fight against corruption, money laundering and financing of terrorism.

“Most of the time the FIC produces intelligence reports based on requests from the law enforcement agencies. We produced 1 840 reports in the year under review, but we also produced 1 054 proactive intelligence reports, which were forwarded to law enforcement agencies,” said Adv Khanyile.

Mr Geodin Hill-Lewis, who is a member of the committee, welcomed the announcement by Adv Khanyile, in which she indicated that although it does not have a legislative mandate to conduct the lifestyle audits, the FIC is available to play a role in an effective system for conducting those audits.

Mr Hill-Lewis said compulsory lifestyle audits for all elected public representatives is long-overdue and cannot be over-emphasised if the country is serious about fighting corruption.

Another member of the committee, Mr Jim Skhosana, raised a concern about the fact that the FIC received unqualified audit opinions in the past three financial years without a clean audit report. He said that it is high time the intelligent centre put measures in place to achieve a clean audit.

By Justice Molafo
16 October 2019