CONFLICT OF INTEREST

1. 1. Purpose
2.   1.1 The General Code of Conduct for Authorized Financial Service Providers and Representatives (“ the Code”) Issued under the Financial Advisory and Intermediary        Services Act, 2000 (Act No. 37 of 2002) (“FAIS”), requires financial services providers to have a Conflict of Interest Management Policy in place to ensure that        conflict of interest is managed appropriately in the business.
3. 
     1.2 The purpose of this policy is to assist ALJ Insurance Brokers and its employees to identify potential and actual conflict of interest and to manage it appropriately.


4. 2. Policy Statement
5. ALJ Insurance Brokers is committed to avoiding, and where this is not possible, mitigating any conflict of interest that may arise between ALJ, as a service provider, and its clients or service providers ( Insurers, and underwriting managers) or their representatives, when rendering financial services to policyholders.


6. 3. Who is subject to the policy?
7. ALJ Insurance Brokers employees and ALJ Insurance Brokers clients (as defined in paragraph 2 above) are bound to by this policy.


8. 4. What is a conflict of interest?
9.   4.1 “Conflict of interest” is any situation, including financial interest, ownership interest, or any relationship with a third party, in which a provider of FAIS        representative has actual or potential interest that may:


10.             4.1.1 influence the objective fulfillment of obligations to a client;
11.             4.1.2 influence the offering of unbiased and fair advice or service to a client; or
12.             4.1.3 prevent the provider or FAIS representative from acting in the best interest of a client.


13.   4.2 This may include:


14.             4.2.1 real or perceived financial gain resulting from recommendations to clients that prejudice the client;
15.             4.2.2 an outcome of service delivery or transaction that may not best serve the interest of the client;
16.             4.2.3 non-cash incentives that may be received by the business as a result of affecting any predetermined transaction and/ or product; and
17.             4.2.4 effecting a transaction and/ or product that may benefit a party other than the client.


18.   4.3 Financial interest that is allowed, is subject to prior approval and the total expenditure not exceeding R1000 per FAIS representative during any one year;        financial interest that is disallowed; and financial interest that is not subject to the Code and therefore does not require any prior approval in terms of this Policy.


19. 5. Mechanisms for identifying conflicts of interest
20.   5.1 Appropriate rules have been put in place around the receipt/ offering of financial interest;
21.   5.2 All remuneration models for representation are required to be signed off by the compliance department or manager of the affected sales area.
22.   5.3 Appropriate training has been developed to enable representatives to identify conflicts of interest situations.


23. 6. Measures for avoidance of conflict of interest
24.   6.1 All expenditure incurred that forms part of immaterial financial interest” will require the written consent of the Manager of the relevant Business Unit and must be        recorded in the relevant conflict of interest register. “Immaterial financial interest” is a financial interest with an aggregate annual value of R1000 or less given by a        third party to the same FAIS representative or FSP.
25.   6.2 Examples of expenditure that form part of “immaterial financial interest” and that will be subject to the specific approval and recording in the conflict of interest        register include items listed in the “allowed, but subject to approval” column in the register.
26.   6.3 Where a conflict of interest cannot be avoided, ALJ‟s representatives are required to make a written disclosure of such a conflict to their existing and potential        clients at the earliest reasonable opportunity, together with measures that were taken to mitigate the situation. Any such disclosures are required to be approved        by the relevant Compliance Person.
27.   6.4 In exercising his discretion, the Compliance Person must have regard to:


28.             6.4.1 the relevant conflict of interest register;
29.             6.4.2 any commission regulations or other laws which may be breached by the receipt of such gift;
30.             6.4.3 a written statement from the giver explaining the reason for and purpose of the gift, that must accompany any request for authorization.


31. 7. Conflict of interest internal controls
32.   7.1 To manage conflicts of interest, ALJ maintains a conflict of interest register and Internal Gift register.
33.   7.2 ALJ must designate an employee that maintains the register, and will from time to time, advise all staff of the name and contact details of the designated        employee.
34.   7.3 A person responsible for the maintenance of the conflict of interest register must record all disclosures made in the register without delay and, must advise the        Compliance Person immediately should the gift exceed the annual limit of R1000 per Fais representative.


35. 8. Reporting of Conflicts of interest
36.   8.1 The outcome of the conflict of interest register shall be reported to the Managing Member/ Compliance Person.
37.   8.2 The monitoring of the conflict of interest register will be done on a quarterly basis by the Managing Member and must include recommendations regarding steps        that will be taken to avoid a recurrence of such conflict of interest.


38. 9. Non-adherence to the Policy
39. Non-adherence to this Policy may result in disciplinary action being taken against the employee, non-adherence by the client may result in the termination of all business relating to that client.


40. 10. Staff training and general awareness
41.   10.1 All the company`s staff must be trained on this Policy
42.   10.2 A copy of the policy will be distributed to each staff member.