Compliance as a strategic advantage

In a fast-evolving regulatory environment, compliance is no longer a peripheral task for financial services providers, it is central to sustainability, reputation, and growth. 

Yet most small and medium brokerages still find themselves tangled in manual processes, fragmented workflows, and rising regulatory expectations. In a recent roundtable, I sat down with Sean Barrett, CEO of FSPHub, and Jaco Moolman, of Lighthouse Risk Consulting, to unpack what it really takes to run a compliant, future-fit brokerage. 

Beyond Tick-box Thinking

Jaco opened with a perspective from his years in the industry, both within FSPs and now as an independent compliance consultant authorised by the FSCA. “For too long,” he noted, “businesses have relied on a tick-box approach instead of embedding compliance into everyday operations.”This is where he believes the next major industry correction will occur. With COFI expected to fundamentally shift how FSPs operate, brokerages can no longer keep compliance as a side activity, they need integrated, risk-based frameworks aligned to their size, structure, and business model.

For many small FSPs, the biggest barrier is understanding the regulatory universe they are required to comply with. It’s not only licence-related compliance, but also the broader obligation of being a business entity delivering financial services in South Africa. The cost of non-compliance is rising sharply, as recent FICA fines show, yet the cost of building internal compliance teams is unrealistic for most brokerages. “Compliance officers are not the doers,” Jaco explained. “We are the helpers. But the business must know what it needs to comply with, and systems must support that.”

Technology as The Missing Link

This is where integration becomes essential, and it’s precisely where FSPHub has stepped in. Sean described the evolution of their platform from workflow management to a more comprehensive compliance-enabling environment. 

Brokerages must meet high regulatory obligations, but in reality, many processes remain manual: onboarding, KYC, client communication, advice records, replacement policy disclosures, and compliance reporting. The administrative load grows, but client expectations grow faster. In a digital world, a slow turnaround time can go viral in minutes. “We’ve always built workflow capability into FSPHub,” Sean said. “But our recent focus has been on technical responses that make compliance easier, not harder.” 

One major enhancement is the integration of a screening and verification platform, automating KYC and due diligence. Historically, brokers rushed through these requirements to get a sale across the line. That era is over. Regulators expect deeper scrutiny and consistent record-keeping at every step of the client journey. 

Sean emphasised that FSPHub’s goal is to make compliance part of the workflow, not an added burden. Every client action, onboarding, renewals, amendments, claims, advice, is recorded as a task in the system. Files, documents, notes, communications, and advice records all sit within the client profile. 

And crucially, compliance officers can log in remotely to audit everything. “There’s no need for compliance officers to visit the office and shuffle through paper files,” Sean said. “The entire lifecycle of a client sits in one place.” 

Towards Automated, Embedded Compliance

Where the discussion became particularly compelling was around the future of compliance within tech systems. Jaco explained the next frontier: compliance triggers baked into workflows. For example, when a broker provides advice that may constitute a replacement policy, the system could automatically prompt questions: Is this a replacement or renewal? Were product features compared? Were premiums and fees fully disclosed? Has the client accepted the recommendation? This becomes especially relevant as insurers increasingly ask for replacement ROAs to fulfil their own FSCA reporting obligations. “Tech can make compliance unavoidable, in a good way,” Jaco said. “It guides the broker to do the right thing at the right time.” This reduces risk, improves consistency, and protects the licence, the heart of any FSP. 

The Strategic Value of Upfront Investment

The roundtable closed with a message both Sean and Jaco strongly support: Brokerages must invest upfront in compliance consultation, systems setup, and operational alignment. Once the right framework is in place and the workflow system supports it, the ongoing cost and complexity of compliance drops dramatically. 

“Being licensed is the core of your business,” I added. “You cannot afford to compromise that licence.” Jaco agreed: “Once a business understands the cost of non-compliance, the investment in proper systems and guidance becomes very small in comparison.”  

Compliance as A Growth Enabler

 

What emerged from this discussion is clear: compliance is no longer a peripheral administrative headache. It is a structural requirement for sustainable growth, empowered teams, and professional client engagement. With platforms like FSPHub integrating workflow, due diligence, screening, documentation, and remote compliance access, and with independent experts like Lighthouse Risk Consulting guiding upfront design, brokerages can transform compliance from a risk into an advantage. The industry is moving quickly. Regulators are moving faster. Brokerages that embrace integrated compliance now will be the ones that thrive in the COFI era.  

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