Greylisting an opportunity to fight financial crimes, Ramaphosa says

President Cyril Ramaphosa describes SA’s greylisting as “concerning, but less dire than some suggest” and argues that it is an opportunity to fight financial crimes.

International financial crime watchdog the Financial Action Task Force (FATF) on Friday added SA and Nigeria to its grey list of countries under special scrutiny to implement standards to prevent money laundering and terrorism financing.

The FATF is an international body that fights financial crimes such as money laundering and terrorism financing by setting global standards monitoring country compliance.

Ramaphosa, admitting that the country fell short of certain international standards for the combating of money laundering and other serious financial crimes, said SA had been a member of the FATF for at least 20 years, indicating its commitment to fighting these criminal activities at home and internationally.

“The listing of SA as a ‘jurisdiction under increased monitoring’ — commonly known as greylisting — has caused much concern about the state of our financial institutions, law enforcement agencies and investment environment. The situation is concerning but less dire than some people suggest,” said Ramaphosa.

The government has gone through a rigorous process of addressing the issues the FATF has raised, he said.

“The fundamentals are in place, and we know what we need to do to get off the grey list. We are determined to do this as quickly as possible. This is important not only for our international standing but also for our own ability to fight these crimes in our country.”

Ramaphosa said the strategic deficiencies identified by the task force did not relate directly to the country’s financial sector, and therefore its financial stability and costs of doing business with the country would not be “seriously impacted”.

“Partnerships between government and the financial sector have 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 R86m,” said the president.

He said SA, like other countries, was dealing with the shifting sands of globalised crime and criminal syndicates, and thus welcomed the intensified monitoring by the FATF.

“The challenge facing authorities is to anticipate criminal innovation and to respond swiftly and effectively. We have a focused action plan in place to address the remaining deficiencies identified by the FATF. Most of these relate to the implementation of our laws,” he said.

“During SA’s last regular mutual evaluation of its measures to combat money laundering and the financing of terrorism, a number of deficiencies were identified.” 

The mutual evaluation was conducted in 2019, he said, when the country was emerging from the state capture era, which had a particularly detrimental impact on institutions like the SA Revenue Service, the National Prosecuting Authority and the Hawks.

“Since the results of the mutual evaluation were published in 2021, we have made great progress in addressing the identified shortcomings. Of the 67 recommended actions emanating from the mutual evaluation, we have successfully addressed all but eight strategic deficiencies.”

.

TimesLIVE