President Cyril Ramaphosa said on Monday that the country’s greylisting is an opportunity to tighten controls and improve the response to organised crime.
Last week, South Africa was put on a ‘greylist’ by the Financial Action Task Force (FATF) for falling short of certain international standards for the combating of money laundering and other serious financial crimes.
The move puts South Africa in the company of countries such as Syria, Haiti, Yemen and Mozambique.
In his weekly letter to the nation Ramaphosa wrote that the development strengthened South Africa in its ability to effectively fight such crimes.
He said the listing of South Africa as a jurisdiction under increased monitoring had caused much concern about the state of the country’s financial institutions, law enforcement agencies and investment environment.
He said, however, that while the situation was concerning it was less dire than some people suggested.
Ramaphosa noted that the strategic deficiencies identified by the FATF did not relate directly to the country’s financial sector, meaning financial stability and costs of doing business with South Africa will not be seriously impacted by the greylisting.
He highlighted that partnerships between government and the financial sector had played a valuable role in efforts to address serious economic crimes.
“The South Africa Anti-Money Laundering Integrated Task Force was set up in 2019 as a partnership between the banking sector and government regulatory authorities. Between the beginning of 2020 and the end of March 2022 successful interventions by the Task Force led to the preservation of criminal assets worth R86-million,” he said.
Ramaphosa noted that, like all countries, South Africa was dealing with globalised crime and criminal syndicates. The challenge facing authorities was to anticipate criminal innovation and to respond swiftly and effectively, he said.
He said South Africa welcomed the intensified monitoring by the FATF and had a focused action plan in place to address the remaining deficiencies identified.
He noted that South Africa’s action plan to address these deficiencies was aligned with the work government was doing to implement the recommendations of the State Capture Commission as outlined in its submission to Parliament in October last year.
He said South Africa had come a long way with developing world-class expertise, legislative reform and strengthening State institutions to combat complex financial crimes, despite deliberate attempts to erode the State’s ability to detect, investigate and prosecute such crimes during the State capture era.
Ramaphosa highlighted that government had restored credibility to key institutions such as the South African Revenue Service (Sars) and the National Prosecuting Authority (NPA) to enable them to fulfil their respective mandates.
“We have bolstered the powers of the Special Investigating Unit (SIU) by establishing a Special Tribunal to recover public funds stolen through corruption and fraud, and an Investigative Directorate in the NPA to investigate serious corruption,” he said.
Ramaphosa noted that one of the country’s most effective tools for combating money laundering and other financial crimes is the multidisciplinary Fusion Centre, established in 2020.
The Fusion Centre brings together bodies such as the NPA, SIU, Sars, the Hawks, Crime Intelligence, the State Security Agency and the Financial Intelligence Centre. Since its inception the work of the Fusion Centre has led to the preservation and recovery of about R1.75-billion in criminal assets.