The Financial Sector Conduct Authority (FSCA) has taken significant regulatory action against Maudi Martin Lentsoane and Lehumo Securities, previously known as Regenesis Markets, in a move aimed at safeguarding investors and restoring confidence in the financial services sector.
This enforcement follows detailed investigations prompted by numerous complaints from clients who claimed they had been unable to access their investment funds despite multiple withdrawal requests.
In a statement yesterday, the FSCA announced a joint administrative penalty of R1 million imposed on Lentsoane and his company. Furthermore, the regulator has barred Lentsoane from providing financial services for 12 years, a decision underscoring the seriousness of the violations committed.
The FSCA’s investigation unearthed a troubling pattern of behaviour that saw Lehumo Securities breach the Financial Advisory and Intermediary Services Act.
Specifically, it was determined that Lentsoane orchestrated operations that required a Category II licence, which neither he nor Lehumo Securities possessed. This infringement not only contravened the fundamental terms of their licensing but also included violations of several other regulatory provisions.
As a direct consequence of these infractions, Lentsoane has been completely barred from participating in the provision of financial services and from acting as a key person within a financial institution. This prohibition extends to any arranged outsourcing agreements, effectively closing the door on his involvement in the sector for the designated period.
The FSCA said that this investigation, initiated in June this year, reflected its commitment to uphold the integrity of the financial system.
The authority underscored that the provisional withdrawal of Lehumo Securities’ licence, which took effect in mid-2023, was necessary to prevent significant harm to clients and the public at large. The decision was made after clients reported severe delays and denials in their withdrawal attempts, suggesting a dire need for regulatory intervention.
BUSINESS REPORT