The Financial Intelligence Centre Act of 2001 and Cash Threshold Reporting

When does the reporting obligation arise for an accountable or reporting institution?

There are two types of institutions that have an obligation to report cash deposits:

  1. Accountable institutions listed in Schedule 1 of the Act such as attorneys.
  2. Reporting institutions listed in Schedule 3 of the Act.

 

Both accountable and reporting institutions have an obligation to report a transaction in which cash in excess of the prescribed amount has either been paid by the institution to the client (or his/her representative) or paid by the client (or his/her representative) to the institution.  

The Financial Intelligence Centre issued a Guidance Notice in respect of Cash Threshold Reporting to them which incorporates AMENDEMENTS TO MONEY LAUNDERING AND TERRORIST FINANCING CONTROL (GG47302) which took effect on 14 November 2022.

Key changes are:

The cash threshold amount has been increased from R24 999.99 to R49 999.99. This includes a series of cash transactions. A report must be made as soon as possible but no later than three business days instead of two business days as was previously the case. 

These provisions kicked in on 14 November 2022. Any outstanding reports that were due before the commencement date will need to be submitted based on the provisions applicable before the amendments, as the amendments do not take retrospective effect.  

The nature of the provisions appears to “relax” the current provisions. It appears that this is a measure to reduce reports – the FIC received 4.5 million reports for the 2021/22 financial year. This however does not change the duty of accountable institutions to report suspicious and unusual transactions. It’s an approach that seems to focus not just on a regulatory approach but a risk-based one.

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The Financial Intelligence Centre Act of 2001 and Cash Threshold Reporting

When does the reporting obligation arise for an accountable or reporting institution?

There are two types of institutions that have an obligation to report cash deposits:

  1. Accountable institutions listed in Schedule 1 of the Act such as attorneys.
  2. Reporting institutions listed in Schedule 3 of the Act.

 

Both accountable and reporting institutions have an obligation to report a transaction in which cash in excess of the prescribed amount has either been paid by the institution to the client (or his/her representative) or paid by the client (or his/her representative) to the institution.  

The Financial Intelligence Centre issued a Guidance Notice in respect of Cash Threshold Reporting to them which incorporates AMENDEMENTS TO MONEY LAUNDERING AND TERRORIST FINANCING CONTROL (GG47302) which took effect on 14 November 2022.

Key changes are:

The cash threshold amount has been increased from R24 999.99 to R49 999.99. This includes a series of cash transactions. A report must be made as soon as possible but no later than three business days instead of two business days as was previously the case. 

These provisions kicked in on 14 November 2022. Any outstanding reports that were due before the commencement date will need to be submitted based on the provisions applicable before the amendments, as the amendments do not take retrospective effect.  

The nature of the provisions appears to “relax” the current provisions. It appears that this is a measure to reduce reports – the FIC received 4.5 million reports for the 2021/22 financial year. This however does not change the duty of accountable institutions to report suspicious and unusual transactions. It’s an approach that seems to focus not just on a regulatory approach but a risk-based one.