FATF GREYLISTING: TREASURY REPORTS ON PROGRESS, OUTLINES WAY FORWARD

FATF GREYLISTING: TREASURY REPORTS ON PROGRESS, OUTLINES WAY FORWARD

• 02 July 2024
• National Treasury
• SA Legal Academy

Please note: On 25 October 2024, National Treasury isssued a media statement announcing that only six of the 22 action items to be addressed by February 2025 are now outstanding. According to the statement, ‘three of these relate to demonstrating a sustained increase in the investigation and prosecution of complex money laundering, terror financing and unlicensed cross-border money or value transfer services. The remaining three relate to the timely access of beneficial ownership information in respect of companies and trusts, and the imposition of remedial action and dissuasive sanctions by designated ... supervisors’.

In the hope of enabling South Africa to ‘exit greylisting by June 2025’, Finance Minister Enoch Godongwana ‘has been leading a process within government’ to address outstanding issues identified in an action plan  jointly agreed in 2023 with the international Financial Action Task Force (FATF). This is according to a National Treasury media statement on the outcome of a June 2024 FATF plenary in Singapore.

South Africa was greylisted in February 2023 because of ‘eight strategic deficiencies’ in its anti-money laundering and combating terrorism financing regime. The action plan focuses on 22 items requiring attention.

Having ‘largely addressed’ three more of these items, South Africa now has 14 to tackle before the end of January 2025 – in anticipation of a FATF plenary the following month. Should the plenary be satisfied that all 22 action items have been fully or largely addressed, a FATF ‘joint group’ will conduct a site visit to confirm that this is so and recommend South Africa’s removal from the grey list.

Progress thus far has focused on:

• legal provisions criminalising terrorist financing and ‘underpinning South Africa’s targeted financial sanctions regime’
• increasing the use of financial intelligence to support money laundering investigations
• ‘the introduction of risk-based tools to identify higher-risk designated non-financial businesses and professions’
• ‘updating … the terror financing national risk assessment’ system, and
• ‘increasing the resources and capacity of relevant authorities’.

The statement describes as ‘a tough challenge’ the process of addressing all 14 outstanding action items concerned by the end of January 2025. Should things not go according to plan, the four-monthly cycle of reporting to the FATF will continue until all 22 deficiencies have been rectified.

• media report

Published by SA Legal Academy Policy Watch

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