PIC Board welcomes FSCA probe

The Board of the Public Investment Corporation (PIC) has welcomed the Financial Sector Conduct Authority’s (FSCA) investigation following a whistleblower report alleging unethical practices within the organisation.

In a statement issued on Wednesday, the Board said it

had provided the Authority with the requested information and documentation relating to the whistleblower report and the associated governance processes.

The FSCA has expressed concern about recent developments at the PIC, particularly those relating to governance, leadership stability, transparency and the potential impact on the integrity of, and confidence in, one of South Africa’s key financial institutions.

Consequently, the Authority has decided to investigate these developments at the PIC in terms of section 135 of the Financial Sector Regulation Act.

“The PIC occupies a unique and critically important position within South Africa’s financial system. As the country’s largest asset manager and custodian of substantial public sector savings, it bears heightened responsibilities to maintain the highest standards of governance, integrity, accountability and conduct. 

“Events over recent months raise serious questions as to whether these standards are being consistently upheld,” the FSCA said.

The Board has placed Chief Executive, Patrick Dlamini, on precautionary suspension following allegations of impropriety contained in a whistleblower report submitted last month.

“The Board believes that strong regulatory oversight is a hallmark of a healthy democracy and resilient financial system. Institutions such as the FSCA and the PIC have a shared responsibility to safeguard the retirement savings of millions of South Africans through sound governance, accountability and transparency.”

The Board also resolved that Government Employees Pension Fund (GEPF) Acting Chief Investment Officer August Van Heerden will cease serving in the position.

It has appointed Leon Smit, the current Head of Fixed Income in Listed Investments at the PIC, as Acting Chief Investment Officer to ensure stability and the optimum management of PIC investment decisions.

While challenges remain, the Board said the PIC has made significant progress in strengthening the corporation’s governance framework and oversight processes.

“The Board remains fully committed to cooperating with all regulators and ensuring that governance matters are addressed through independent, credible and transparent processes.

“The Board appreciates the FSCA's continued vigilance and looks forward to working constructively with the Authority in the interests of maintaining confidence in South Africa's financial sector and protecting the interests of pensioners.” - SAnews.gov.za