FICA and The Protection of Personal Information Act (POPIA) [Part 2}

How does POPIA impact on the Processing of Personal Information as required by FICA?

As stated in Part 1: What is POPIA?  the collection and processing of personal information should always be lawful, reasonable, relevant, and moderate, for an explicitly defined purpose relating to the data collector’s specific activity or function.  In the case of Estate Agents, this purpose is defined by FICA and agents must follow the requirements of FICA when processing personal information.

Estate Agents are listed as accountable institutions for the purposes of FICA.  This compels Estate Agents to establish and verify the identity of all clients and stipulates what authority people have when acting on behalf of a client, when, for example, the client is a company.  In the case of a lease agreement, the company in whose name the lease agreement was signed in is the client and the person acting on behalf of the client is the signatory.  The signatory’s authority to act on behalf of a client is verified by a Company Resolution. 

The identity of the client is established by way of the information requested in the Mandate or Rental Application document and would apply to a landlord or tenant.  The identity of the client is verified when accurate and up-to-date copies of Payslips/Proof of Employment, IDs/Passports, Proof of Residence, Company Documents and Resolutions are received and validated against the information provided.  The same information and process would apply to a Sales transaction.

FICA thus determines the purpose and type of information to be collected from clients and the duration it is to be stored, whereas POPIA regulates processing aspects such as safeguarding the information, keeping information confidential, and not unlawfully selling/providing information to other parties. Should a rental applicant or landlord refuse to provide the requisite personal information, the accountable institution (the estate agent) may not [by law] establish a business relationship or conclude a single transaction with that client.Failure to comply would put the estate agent in contravention of the FICA stipulations.  The estate agent would also need to report this to the Financial Intelligence Centre, as FICA compels accountable institutions to report certain information to FIC.

The Act states:

If an accountable institution is unable to—

(a)          establish and verify the identity of a client or other relevant person;

(b)          obtain any additional information required (such as the nature and purpose of the business; relationship or source of funds the client intends to use to conclude the business relationship)

(c)          conduct ongoing due diligence as required by the act.

The accountable institution then:

(i)           may not establish a business relationship or conclude a single transaction with a client;

(ii)          may not conclude a transaction in the course of a business relationship, or perform any act to give effect to a single transaction; or

(iii)         must terminate, in accordance with its Risk Management and Compliance Programme, an existing business relationship with a client, as the case may be, and consider making a report under section 29 of this Act.

(iv)         must report suspicious and unusual transactions or activities to FIC

The Retention and Restriction of Records. 

POPI requires that records of personal information must not be retained any longer than is necessary for achieving the purpose for which the information was collected or subsequently processed, but FICA requires that Estate Agents must keep the records which relate to the establishment of a business relationship for at least five years from the date on which the business relationship is terminated.

The retention of records of personal information, as applies to an Estate Agent in compliance with both POPIA and FICA, is a period of five years after the client relationship has been terminated.  Section 48 of the FIC Act stipulates that any person who wilfully tampers with or destroys such a record is in contravention of the law.

As mentioned above, FICA determines the purpose and type of information to be collected from clients and the duration it is to be stored, POPIA regulates processing aspects such as safeguarding the information, keeping information confidential, and not unlawfully selling/providing information to other parties. 

The reason that Estate Agents are required to ask for and verify FICA documents is to ultimately help prevent the funding of terrorism and other crimes by taking the prescribed steps to identify and verify clients.  This impacts on POPI by imposing certain minimum requirements and setting out the type of personal information that needs to be processed.  Estate Agents are therefore required to process personal information for POPI as per the requirements of FICA - the two are thus linked.