Sanlam firms fined over commissions

Two Sanlam subsidiaries, Sanlam Developing Markets and Channel Life, have been fined a total of R3 million for paying commissions to product sales people in excess of that allowed by regulation.

In a media statement, the Financial Services Board (FSB) says the overpayment to intermediaries took place from November 2008 until June 21 this year. It says the overpayment was due to a “system design error”.

The matter was referred to the FSB Enforcement Committee, which handed down the fine.

As mitigating circumstances, the Registrar of Long-term Insurance considered that Sanlam Developing Markets, which was fined R2 million, and Channel Life, which was fined R1 million, fully cooperated with the investigation and have put measures in place to rectify the contravention by addressing all the compliance issues relating to the matter and amending their processes where required.

The registrar also considered the contravention the result of a bona fide oversight in the design of the system, the FSB says. – Bruce Cameron