By Lehlohonolo Lehana.
South Africa, Mozambique, Nigeria and Burkina Faso have been removed from a Financial Action Task Force (FATF) list of countries subject to increased monitoring for illicit money flows.
The FATF made the announcement at a plenary meeting on Friday.
South Africa and Nigeria landed on the grey list in February 2023, while Mozambique was added in October 2022 and Burkina Faso originally got designated in February 2021.
The move follows earlier reform progress highlighted at the FATF’s June plenary, and which commended the four countries for strengthening their systems to combat illicit financial flows.
FATF President Elisa de Anda Madrazo noted that “a record of four countries have been removed from the greylist, including South Africa, which has sharpened the tools to detect money laundering and terrorist financing”.
The FATF’s decision ends SA’s two year stint in the global naughty corner, better known as the greylist, for anti-money laundering and counter-terrorist financing (AML/CFT) compliance. Among the improvements cited were “a sustained increase in investigations and prosecutions of serious and complex money laundering and the full range of terrorist financing activities,” and “enhancing identification, seizure and confiscation of proceeds and instrumentalities of crime”.
The FATF assessment calendar shows South Africa could have an on-site visit in April 2027, when it will be evaluated on the group’s new methodology for the fifth round of reviews.
National Treasury thanked all relevant government departments and government agencies on the success of their individual and collective efforts. And acknowledges their commitment to ensuring that the country exits the FATF greylist.
It also acknowledges the support and guidance received from ESAAMLG, support from the private sector, including regulated institutions, as well as the technical assistance from the EU, UK, USA, Switzerland and the World Bank.
“We would also like to thank the members of the FATF Africa Joint Group, who displayed a high level of professionalism and fair-mindedness as they assessed South Africa’s progress. As well as the FATF Secretariat, for managing a complex process with a high degree of efficiency.”
“National Treasury would also like to congratulate Nigeria, Mozambique and Burkina Faso, which were also delisted from the FATF greylist this week.
Standard Bank’s head of South Africa macroeconomic research, Dr Elna Moolman, said the delisting showed “South Africa’s ability to implement change — the speed with which we’ve achieved the required changes was remarkable”.
She believes the change could open the taps for foreign capital that had been hesitant to flow into a high risk jurisdiction. “[The delisting] gives investors comfort that we are meeting the global standards in terms of combatting money laundering and the financing of terrorism,” she explained.