Deputy Minister of Finance, Dr David Masondo, has reiterated to his counterparts in the United States of America (USA) that government is working hard to get South Africa out of the grey list.
“[We] are working together with [the] Financial Action Task Force (FATF) and the United States as our important partner to combat illicit and terror finance, manage risks associated with that, and generate the necessary investor confidence in our country,” Masondo said.
South Africa was grey listed by the FATF in February 2023 for not complying with international standards that relate to money laundering and addressing illicit financial flows.
The FATF is the international standard-setting body that oversees global compliance with anti-money laundering rules.
The FATF grey list refers to the FATF’s practice of publicly identifying countries with strategic AML/CFT deficiencies. The FATF maintains two such lists with one being jurisdictions under “increased monitoring” that are actively working with the FATF to address strategic deficiencies in their regimes” and secondly “high-risk jurisdictions subject to a call for action” that are not actively engaging with the FATF to address these deficiencies.
The Deputy Minister and the United States Deputy Secretary of Treasury, Wally Adeyemo, as well as officials, recently held a bilateral meeting as part of measures to strengthen cooperation between the two Treasuries and associated entities.
“Investment is critical for economic growth, which is a necessary condition for addressing unemployment and poverty in our country. But if our country is infested with corruption, illicit and terror finance, we cannot attract investment. Hence, we are working hard to get out of the greylist,” said Masondo.
Deputy Secretary Adeyemo said the US shared a “deep and broad” relationship with South Africa and that South Africa can continue to take steps that will ensure that it attracts more capital from the US and other parts of the world.
The Deputy Minister said the capacity of agencies such as the South African Revenue Service (SARS) and the National Prosecuting Authority (NPA) has been improved upon in order for them to combat issues such as money laundering.
The US authorities also offered further technical assistance to assist South Africa to exit the grey listing, and rebuild the capability of institutions combatting money laundering, terror financing and wildlife trafficking.
Masondo said South Africa has made significant progress since being grey listed, including passing two Acts in Parliament aimed at addressing money laundering and terror financing.
Finance Minister Enoch Godongwana tabled in Parliament the Anti-Money Laundering and Combating Terrorism Financing Amendment Bill in August 2022. The tabling followed Cabinet’s approval of the bill at its meeting on 17 August 2022.
In a statement at the time, the National Treasury said the approval was a demonstration of government’s commitment to the fight against corruption, money laundering and terror financing.
READ | SA works on exiting FATF grey list
The country has also addressed 15 of the 20 legislative deficiencies identified by the Financial Action Task Force.
The US Deputy Secretary of the Treasury is visiting South Africa from 10th – 15th March 2024.
