It is worth establishing, before your next client onboarding, whether the FIC Act classifies your firm as a Trust and Company Service Provider (TCSP) rather than an accounting practice. Many accountants assume the classification does not apply to them. Two misconceptions are common and both are inaccurate: that every accountant is automatically an accountable institution, and that accounting work falls entirely outside FICA. The correct position sits between the two and it is determined by the services your firm provides, not by your professional accreditation.

Definition of item 2, a TCSP as defined in Schedule 1 of the FIC Act: 

(a) A person who carries on the business of preparing for or carrying out, transactions for a client, where- 

(i) the client is assisted in the planning or execution of-

(aa) the organisation of contributions necessary for the creation, operation or management of a company, or of an external company or of a foreign company, as defined in the Companies Act, 2008 (Act 71 of 2008);

(bb) the creation, operation or management of a company, or of an external company or of a foreign company, as defined in the Companies Act, 2008; or

(cc) the operation or management of a close corporation, as defined in the Close Corporations Act, 1984 (Act 69 of 1984.)

(b) A person who carries on the business of-

(i) acting for a client as a nominee as defined in the Companies Act, 2008 (Act 71 of 2008); or

(ii) arranging for another person to act for a client such as a nominee. 

(c) A person who carries on the business of creating a trust arrangement for a client. Public compliance communication 6A guidance on the definition regarding a trust and company service provider as Item 2 in Schedule 1 of the Financial Intelligence Centre Act.

(d) A person who carries on the business of preparing for or carrying out transactions (including as a trustee) related to the investment, safe keeping, control or administering of trust property within the meaning of the Trust Property Control Act, 1998 (Act 57 of 1988).

The activities that make a firm a TCSP

If your firm limits itself to core accounting work, preparing financial statements, bookkeeping and filing tax returns, it is generally not a TCSP, and the FIC’s own guidance (PCC 6A) confirms this. The line is crossed when any one of four categories of activity, set out in Item 2(a)–(d), becomes a regular feature of your business. A firm may fall within a single category or several at once; you only need to perform one of them as a business to be classified as a TCSP. Items 2(a)–(d):

1. Company services: Assisting clients with the creation, operation or management of a company, external company or foreign company (Companies Act, 2008), or the operation or management of a close corporation (Close Corporations Act, 1984), including organising the contributions needed to establish such an entity.
2. Nominee services: Acting as a nominee for a client, broadly, holding shares or an interest in securities on another person’s behalf, as defined in the Companies Act, 2008, or arranging for another person to do so.
3. Trust creation: Creating a trust arrangement for a client.
4. Trust administration: Preparing for or carrying out transactions related to the investment, safe-keeping, control or administration of trust property (including acting as a professional trustee) under the Trust Property Control Act, 1988.

It is equally important to understand what does not bring a firm within the definition. Routine accounting functions, bookkeeping, preparing financial statements, filing tax returns and acting as a liquidator, fall outside it.

What being a TCSP requires

Crossing the line changes your compliance obligations substantially. A firm classified as a TCSP must put the following in place:

1. Registration under Item 2: Register with the FIC as a company service provider, a trust service provider, or both. A firm already registered under another Schedule 1 item, for example, a law firm under Item 1 must register again under Item 2. This is known as dual registration.
2. Risk and Compliance Return (RCR): Under Directives 6 and 11, TCSPs must report their understanding of money laundering, terrorist financing and proliferation financing risk. This is a separate obligation from registration.
3. A tailored RMCP: Your Risk Management and Compliance Programme must address the specific risks associated with creating and administering company and trust structures.
4. Beneficial ownership due diligence: Because corporate structures are frequently used to conceal ownership, customer due diligence must identify and verify the Ultimate Beneficial Owners (UBOs) of the entities involved.
5. Ongoing sanctions screening: Screen clients, beneficial owners and related parties against the Targeted Financial Sanctions (TFS) lists at onboarding, during significant transactions and whenever the lists are updated.

Alongside these, the standard FICA obligations apply, keeping the required records, training staff on their anti-money laundering responsibilities and reporting suspicious and certain cash transactions to the FIC.

An important practical point: becoming a TCSP does not require applying FICA to your entire client base. The obligations apply only to the clients you serve in your TCSP capacity. Clients for whom you provide standard accounting services are not affected simply because another part of the firm offers trust or company services.

How to assess your status

Your status is determined by the services you actually deliver, if you fall within the definition (even for just a few clients) registration and a compliant RMCP are required. Because the FIC now supervises these sectors directly, a firm that should be registered but is not, or that operates without an adequate RMCP, is exposed to administrative sanctions, including financial penalties as well as reputational damage.

Ongoing screening is one of the more demanding obligations to maintain over time. ClientScanner supports this aspect of FICA compliance through sanctions screening, ID validation and ongoing monitoring, helping firms keep client checks current without significant manual effort.