The FAIS Act was established to regulate the conduct of financial institutions who offer credit or other financial products to clients (members of the public), in terms of supplying accurate and informative financial advice, and to repeal or amend certain laws and provide for matters incidental thereto.
The FAIS Act basically stipulates that the client needs all the necessary information to make an informed decision. It is up to the service provider (bank/financial institution) and their representatives (car dealerships and the like) to provide true and accurate information and to answer all questions in order to satisfy any queries the client has relating to a financial product or service.
The FAIS Act obligates financial institutions to do the following:
Disclose relevant material information and actual or potential own interests in dealing with clients;
Keep adequate and appropriate records;
Avoid fraudulent and misleading advertising, canvassing and marketing;
Keep clients’ funds and confidential documents safe and properly separated;
Offer suitable guarantees or professional protection or fidelity insurance cover; and
Tend to any other matter which is necessary or useful to regulate in order to achieve the objectives of this act.
This article originally appeared in Property Power 11th Edition Magazine. To order your copy at the discounted price of R120 click here