Passing of amendment bills may help SA avoid being grey-listed

The passing of the General Laws (Anti Money Laundering and Combating Terrorism Financing) Amendment Bill and the Protection of Constitutional Democracy Against Terrorist and Related Activities Amendment Bill by both Houses of Parliament will definitely help the country in its efforts to avoid being grey-listed in February next year.

National Treasury has welcomed the news, saying that the bills help the country tick off a few of the boxes on the list of the 40 recommendations given by the Financial Action Task Force.

Amended bills were introduced in August and July this year

The General Laws Amendment Bill was introduced in the National Assembly by the Minister of Finance, Enoch Godongwana, on 29 August this year, while the POCDATARA Bill was introduced in the National Assembly by the Minister of Police, Bheki Cele, in July. Both Bills were passed by the National Council of Provinces on 13 December 2022, and will be sent to the President for assent.

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These latest developments will add to the October steps-forward when Parliament also approved amendments to Schedules 1, 2 and 3 to the Financial Intelligence Centre Act in addressing weaknesses in the country’s ability to combat money laundering and fight financial crime as well as addressing the legislative deficiencies.

Regulatory authorities should also undergo proper assessment

The FATF also suggested that all regulatory authorities should subject beneficial owners to fit and proper assessments. All regulatory authorities should also verify that directors, senior management and beneficial owners or their associates are not criminals.

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The FATF also recommended that all regulatory authorities should do better in prioritising and scoping on-site supervision based on money laundering or terrorist financing risks, which could be informed by offsite monitoring and findings from previous inspections.

The South African government has been doing all it can to avoid being grey-listed by the global money laundering and terrorist financing watchdog.

The FATF maintains two lists: namely, a black and a grey list. Countries are typically put on the grey list if serious deficiencies are found in their anti-money laundering and terrorism financing policies and systems. At present, there are 23 countries on the FATF’s grey list, and if South Africa is grey-listed, it will join the likes of Uganda and Yemen.