Page 107 - KZN Top Business Portfolio 2024/5 - ebook

NAVIGATING TRUST CLOSURES AMID SOUTH Africa’s broader efforts to restore trust in its financial
AFRICA’S GREY-LISTING CHALLENGES systems. With its expert guidance, LEMS assists clients
in fulfilling their regulatory obligations, contributing
As South Africa grapples with the aftermath of its to a more transparent and compliant financial future
grey-listing by the Financial Action Task Force (FATF), for the country.
the urgency around compliance has intensified, In the face of tightening regulations, LEMS serves as a
particularly in the realm of trust management. trusted partner, providing a streamlined approach to
Heightened regulatory enforcement looms, the often cumbersome process of closing redundant
compelling trustees and financial professionals to or non-operational trusts. Their services help mitigate
meet stringent requirements or face substantial risks, reduce administrative burdens, and ensure that
penalties. Recent Department of Justice & all legal requirements are met swiftly and securely.
Constitutional Development (DOJ & CD) circulars Co-owned by Brian Payne, a seasoned tax consultant
highlight sanctions for non-compliance, putting with a wealth of experience in complex tax matters,
trustees—regardless of trust activity—at significant and Alan Hockey, a Lean Six Sigma Black Belt and data
risk. analyst, LEMS combines deep regulatory knowledge
Many trustees, who may have previously neglected with data-driven methodologies to deliver efficient
their legal obligations to administer or close trusts, and reliable trust closure services. Their tailored
are now finding themselves legally mandated to take solutions cater specifically to financial advisors and
action. professionals managing multiple entities, setting
them apart in a crowded market.
The country’s grey-listing has highlighted challenges
related to illicit financial flows and regulatory LEMS’s distinctive approach includes a unique two-
oversight, prompting a critical need for improved step payment system and personalised client portals
trust governance. Trusts that are poorly managed or that ensure transparency and efficiency. Clients pay
inactive have emerged as liabilities, exposing trustees 50% upfront and settle the remaining balance before
to significant compliance risks. In this evolving receiving their Trust Closure Certificate, providing a
landscape, the expertise of trust management seamless and stress-free experience.
services like Legal Entity Management Systems (LEMS) As South Africa strives to meet the compliance
has become indispensable. demands imposed by the FATF and work towards
LEMS plays a pivotal role in helping financial being removed from the grey list, LEMS’s specialised
professionals and trustees navigate the complexities services stand out as a critical resource, easing the
of trust closures, aiding them in avoiding penalties, pathway to regulatory adherence while bolstering
meeting compliance deadlines, and supporting South confidence in the nation’s financial landscape.

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