The African National Congress said it was concerned that South Africa had been greylisted by the Financial Action Task Force (FATF) on Friday. It also urged the government to implement strategies to curb the flow of illegal money into the country.
FATF is the global money laundering and terrorist financing watchdog.
SA is added to the gray list
The decision means South Africa will face increased monitoring by the FATF. This also means that international banks will now place the country in a higher risk category.
Also read: South Africa graylisted by global watchdog FATF
Countries are added to the gray list when they are deemed insufficient to combat illicit financial flows, including money laundering and terrorist financing.
“The decision is based on FATF’s assessment that South Africa has eight areas of strategic deficiencies related to the effective implementation of anti-money laundering and countering the financing of terrorism laws that still require attention,” the party said.
It said South Africa has until November 2025 to address the shortfall.
The ANC blames state capture
The ANC blamed state capture for undermining the country’s law enforcement institutions and the South African Revenue Service (Sars).
“We commend the efforts of the ANC government to restore the capacity of the crime prevention and security group. The fruits of our success in this work are clearly shown by the number of arrests, money that can be recovered and the number of cases in our courts,” he said.
The ANC said when the specter of greylisting first appeared in South Africa, the country had 130 actions to take. He said there were only eight left to complete.
“The ANC supports prompt action to address the issues identified by the FATF, which is consistent with the recommendations of the Judicial Commission of Inquiry into Allegations of State Capture – whose implementation the ANC fully supports.”
Also read: Costs for banks and BUMN may increase if SA is greylisted
‘damn indictment’
The Democratic Alliance (DA) did not share the ANC’s optimism.
He said the decision to create a gray list in South Africa was a “shocking indictment” of the country’s criminal justice system and its inability to fight financial crime.
“This situation arises mainly because of the inadequacy of the legal framework and the failure of the authorities to prosecute those responsible for these crimes,” said the DA.
Opposition parties say greylisting is unacceptable.
“The gray list puts our country at significant risk, as the rest of the world now sees South African companies and individuals as high-risk partners in global transactions.”
Freedom Front Plus (FF+) also said the government had not done enough to prevent graylisting.
He said the ANC was repeatedly warned to act, but waited until the last minute.
“Improvements are mainly needed in two areas to avoid gray list status. The first is to make relevant legislative amendments and the second is to show that financial offenses are effectively fought,” said FF+ MP Wouter Wessels.
“The ANC has failed on both fronts,” he said.