Pam Golding Properties face huge fine for 'breaking' laws

Pam Golding Properties faces a fine being accused of contravening financial regulatory laws.
Pam Golding Properties faces a fine being accused of contravening financial regulatory laws.

The country's top estate agency Pam Golding Properties could be slapped with a "huge fine" after being accused of contravening financial regulatory laws.

This as the Estate Agency Affairs Board (EAAB) has launched a probe into Pam Golding after the company allegedly facilitated the sale of properties to children of a former Mozambican President Armando Guebuza.

The board confirmed the "full-scale" probe in a media statement following allegations that the company contravened financial regulatory laws in facilitating the sale of property to politically exposed people.

"Pam Golding Properties will be the subject of a multi-pronged investigation following reports that it allegedly facilitated the sale of properties to the children of former Mozambican President Armando Guebuza without following legal requirements and thus allegedly aided money laundering.

"The two properties in Dainfern and Kyalami Estate, north of Johannesburg, are said to be worth a combined R50m.

"In a first-of-its -kind investigation, the EAAB has requested a joint probe with the Financial Intelligence Centre (FIC) into the allegations carried in a February 21, 2020 article in Mail and Guardian newspaper.

"It is alleged that former political leaders and their families were laundering money by investing large sums of illegal monies in properties in South Africa, resulting in the artificial inflation of property prices and skewed market values.

The board's chief executive Mamodupi Mohlala said the allegations are of a serious nature and that senior officials from the regulator would be leading the probe.

“Enforcement and compliance are at the core of our mandate as a regulator. We therefore have to ensure that there is full compliance no matter how big or small a licensee. We demand full compliance in the interests of consumer and public protection,” Mohlala said.

She said board will soon meet with the FIC to finalise the scope of the investigation which will look into whether Pam Golding Properties transgressed sections of the FIC Act.

These include section 21B which requires determining the identity of a client; section 27A which involves money laundering and terrorist financial control regulations; section 29 which deals with suspicious and unusual transaction; section 31 which deals with cross-border electronic transfer and section 42A which requires a company and its employees  to ensure compliance with a risk management and compliance programme.

Mohlala said the investigation would involve officials doing on-site inspections at Pam Golding Properties’ premises and requesting access to documents.

"Any adverse findings will result in the agency being hauled before an EAAB disciplinary hearing. The final findings would determine a possible sanction which could include a substantial fine.

“We will expedite the investigation and request co-operation from all parties involved. The allegations against Pam Golding’s conduct is most concerning. We are aware that the property sector, more especially the real estate sector, is a source of wealth creation.

"We, however, say create wealth legally and according to rules and policies.  We therefore intend on using legislative tools to ensure compliance by all players, including Pam Golding which is one of the biggest players in our space. No one is above the law."