OMBUD COUNCIL ANNUAL REPORT 2024/25

PART B: PERFORMANCE INFORMATION

2.4.3 FINANCIAL ADVISORY AND INTERMEDIARY SERVICES (FAIS) OMBUD

2.4.4 JSE OMBUD

In relation to the JSE Ombud, complaints regarding trading on the JSE markets that involve authorised users (brokers) are initially handled and resolved by the JSE Market Regulation Division and only referred to the Ombud where this process fails. In 2024, the JSE Ombud handled one matter that required resolution however no particular complaint trends have been identified. The outcome of the matter was a decision in favour of the complainant by the JSE Ombud and an award for the full amount of the loss incurred was made.

The FAIS Ombud has noted a large increase in enquiries, which it ascribes to an increase in awareness of the scheme among financial consumers. The increase has led to a corresponding increase in referrals to the NFO. A trend observed by the FAIS Ombud is that the number of complaints against the ten largest financial services providers (FSPs) has reduced significantly due to early resolution of the complaints between the complainant and the FSPs. A substantial number of complaints are being resolved at the premature stage with respondents opting to settle justified complaints speedily. The FAIS Ombud’s largest complaint categories remain long term insurance and, in particular, funeral policies. As pointed out above, with regard to the NFO Life Insurance Division, the Ombud Council intends to participate in the Inter-regulatory Funeral Insurance Project being led by the FSCA and the Prudential Authority. The FAIS Ombud has received several complaints where representatives of FSP firms have conducted a Ponzi type scheme together with legitimate investments. Typically, the representative did legitimate business with clients through the licensed FSP and then also enticed them to invest with the representative directly, promising unrealistic returns on their investment. The representatives in these cases were debarred by either the FSP or FSCA, as the case may be, once the fraud was discovered, as required by the FAIS Act. As these Ponzi type schemes essentially constitute a form of fraud and do not involve a licensed financial product, and there is no basis for a finding against the FSP firm itself (as it has complied with its FAIS Act obligations), they do not fall within the FAIS Ombud’s jurisdiction. These matters are referred to the FSCA for enforcement action. .

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OMBUD COUNCIL ANNUAL REPORT 2024/25