PassPath
Free mock exam

Can a Key Individual also be the compliance officer? What the FSCA looks at

By The PassPath Team · Last updated

Part of: The RE1 Exam: complete 2026 guide

There is no FSCA rule that a Key Individual must not be the compliance officer: nothing in the FAIS Act, the compliance officer criteria or the FAIS Regulations bans one person holding both roles (FAIS Act s17; Board Notice 127 of 2010). But the FSCA must approve the compliance officer, and it must be satisfied that the person can provide independent, objective oversight. That is hard to show when the same person runs the business being monitored, so confirm with the FSCA before you plan around it.

The approval test is in BN 127 of 2010, paragraph 4(3): the person must be able to act independently and objectively and avoid conflicts of interest. Whether it will be approved in your case is not settled by any published rule we could find.

When does an FSP need a compliance officer at all?

An FSP must appoint a compliance officer if it has more than one Key Individual, or one or more representatives (FAIS Act s17(1)(a)). An FSP with a single Key Individual and no representatives does not need one, but must still have compliance procedures and submit compliance reports itself (s17(3) to (5)).

Every FSP must have a compliance function within its risk management framework, and the compliance officer reports to the FSP in writing (FAIS Regulations 2003, regulation 5).

What must a compliance officer meet?

The compliance officer must be fit and proper and approved by the FSCA against its criteria (s17(1)(b) and s17(2)(a)). The current criteria are in Board Notice 127 of 2010, as amended in December 2022:

  • Phase I approval: a recognised compliance qualification, the regulatory exams (the RE1 for Category I and IV FSPs, the RE1 and RE3 for Category II and IIA, and the RE1 and RE4 for Category III, paragraph 1, definition of regulatory examination), 3 years of compliance or risk management experience (1 year in the relevant category), honesty and integrity, and solvency (paragraph 3(1)).
  • Phase II approval: independence and objectivity, avoiding conflicts of interest, and direct access to senior management (paragraph 4).
  • Minimum visits for an internal compliance officer: at least once a year for Category I and IV FSPs, and at least once a quarter for Category II, IIA and III (paragraph 4(4)(b)).

For what the role involves day to day with representatives, see our guide for FSP compliance officers.

How do Key Individual responsibilities clash with independent oversight?

A Key Individual manages or oversees the financial services the FSP renders (FAIS Act s1, definition of key individual). The full list of duties is in Key Individual responsibilities.

The compliance officer checks whether those same services comply. Doing both means checking your own work, which goes straight to the independence and conflict tests in paragraph 4(3) (BN 127 of 2010).

One more point to check: an internal compliance officer is defined as a natural person in the permanent employ of the FSP (BN 127 of 2010, paragraph 1). Whether a sole proprietor, or an owner who is not an employee, fits that definition is unclear. We found no rule or FSCA guidance that settles it, so confirm with the FSCA before relying on it.

None of this makes it impossible. But the published rules do not say when the FSCA will accept it, so treat it as a question for the FSCA rather than a yes.

What about a one-person FSP?

If the owner is the only Key Individual and there are no representatives, s17(1)(a) does not require a compliance officer at all. The FSP still needs compliance procedures and must submit its compliance reports (FAIS Act s17).

Where the owner is both the Key Individual and a representative, the position is less clear. A 2010 slide presentation hosted by Moonstone says no compliance officer is needed in that case, but it is a secondary source and its author is not shown, while the wording of s17(1)(a) counts "one or more representatives" (Moonstone-hosted 2010 paper). We could not find a current rule that settles it either way, so confirm with the FSCA before deciding.

What should you be ready to explain to the FSCA?

Paragraph 4 requires the FSCA to be satisfied on independence, conflicts of interest, access to senior management and how often the compliance work is done (BN 127 of 2010, paragraph 4). If you apply for one person to hold both roles, deal with each of those in the application, including how the Key Individual's own decisions will be checked.

What are the practical options?

  • Use an external compliance practice. This is common for small FSPs and avoids the self-review problem. An external officer must also meet paragraph 4 and must visit more often: quarterly for Category I and IV, monthly for Category II, IIA and III (paragraph 4(4)(a)).
  • Appoint an internal compliance officer who is not a Key Individual, where you have someone who meets the criteria.
  • Ask the FSCA before applying for a Key Individual to be approved as compliance officer, and record the answer.

Compliance monitoring is not the only oversight an FSP needs. For how representatives working under supervision are overseen, see supervision of representatives under FAIS.

Whichever option you choose, the RE1 is part of it. Key Individuals must pass it before approval (Board Notice 194 of 2017, s26(6)), and it is also in the compliance officer criteria. The other Key Individual requirements the FSCA applies are set out in Key Individual requirements.

Frequently asked questions

No. No rule forbids it, but under paragraph 4(3) of Board Notice 127 of 2010 the FSCA must be satisfied that the compliance officer can act independently and objectively, which is hard to show when you are checking your own work. Confirm with the FSCA first.

Under the FAIS Act definition, a Key Individual manages or oversees the financial services the FSP renders. Our article on Key Individual responsibilities has the full list.

No. Under section 17(1)(a) of the FAIS Act, one is required when the FSP has more than one Key Individual or one or more representatives.

Yes, under the current criteria in Board Notice 127 of 2010, plus the RE3 for Category II and IIA FSPs and the RE4 for Category III.

Under paragraph 4(4)(b) of Board Notice 127 of 2010, an internal compliance officer must visit at least once a year for Category I and IV FSPs, and at least once a quarter for Category II, IIA and III.

Sources

PassPath is an independent study platform. The RE1 and RE5 are written through Moonstone; PassPath is not affiliated with Moonstone or the FSCA.

The exam itself, with sources

These facts are about the exam, not about any study provider. Each one links to a public source you can check.

PassPath is an independent exam-prep tool. The RE exams are administered through Moonstone under the FSCA; always confirm official details (fees, dates, venues) with Moonstone.