One step off the greylist, but who's watching the watchdogs?
The announcement from the FATF Plenary in Strasbourg, France, marked a significant milestone for South Africa's beleaguered financial sector.
Image: Ron AI
BY ALL accounts, South Africa has come a long way since February 2023, when it was placed on the Financial Action Task Force (FATF) greylist over concerns about weak enforcement mechanisms and a lack of political will to combat high-level corruption.
Now, nearly two years down the line, the country is on the cusp of delisting after 'substantially completed' all 22 action items set out by the global watchdog.
The announcement from the FATF Plenary in Strasbourg, France, marked a significant milestone for South Africa's beleaguered financial sector. The country now awaits an on-site verification visit — a final step before potential delisting at the next FATF Plenary in October 2025.
'This is not just about ticking boxes,' National Treasury said in a recently released statement. 'This is about rebuilding institutions hollowed out during years of state capture, and restoring credibility to our financial systems.'
Yet while the technical progress has been lauded internationally, domestic critics warn that celebration may be premature — and that complacency could unravel everything.
South Africa's greylisting in 2023 was more than a reputational blow; it was a financial reckoning. Banks faced higher correspondent banking costs, foreign investment slowed, and businesses were forced to navigate an increasingly complex and costly regulatory environment.
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Advertisement
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Next
Stay
Close ✕
The legacy of state capture — under which law enforcement agencies were deliberately weakened — made the path to compliance long and arduous. But according to the FATF's latest communiqué: 'South Africa has demonstrated a sustained increase in investigations and prosecutions of serious and complex money laundering and the full range of terror financing activities in line with its risk profile.'
That turnaround, according to officials, was only possible due to the relentless work of key institutions such as the Directorate for Priority Crime Investigation (DPCI — alias Hawks), the State Security Agency (SSA), and the National Prosecuting Authority (NPA).
'Without their commitment, we would still be floundering,' read the Treasury statement. 'These are the same institutions that were targeted during the Zuma era. To see them rise again is nothing short of remarkable.'
The FATF has confirmed that South Africa has met the technical requirements for delisting, but the final verdict rests with the FATF Africa Joint Group, which is set to conduct an on-site visit prior to the October 2025 Plenary. 'The Joint Group will verify that implementation of AML/CFT reforms has begun and is being sustained, and that the necessary political commitment remains in place to sustain implementation in the future,' stated the FATF on June 13.
National Treasury confirmed that preparations for the visit were already underway.
While Treasury paints a picture of institutional renewal, opposition parties remain deeply skeptical. The DA, now part of the Government of National Unity (GNU), has cautiously welcomed the FATF's upgrade of South Africa's progress but issued a warning against any complacency that could derail the country's full removal.
'While this is an important step, the DA cautions the NPA and our financial regulators against complacency,' DA Deputy Spokesperson on Finance Wendy Alexander said in a statement. 'Exiting the greylist remains subject to a site visit by the FATF ahead of the body's next plenary in October.'
Alexander stressed that further delays would only deepen the damage. 'The longer South Africa stays on the greylist, the harder it will be for our banks to do business both domestically and internationally,' she warned, adding that a one-off effort would not be enough. 'Exiting and staying off the greylist requires not once-off window dressing, but sustained change and implementation.'
South Africa shares the spotlight with several African nations making strides against financial crime. Mali and Tanzania have been officially delisted from the FATF greylist, while Nigeria, Mozambique, and Burkina Faso were also recognised for having substantially completed their respective action plans.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The South African
4 hours ago
- The South African
Tensions grow between SASSA and the National Treasury
SASSA and the National Treasury were at loggerheads this week in Parliament. New SASSA CEO Themba Matlou, who's barely been in the job permanently for two months, had to answer to the Parliament portfolio committee on social development. At the centre of tensions between SASSA and the National Treasury are conditions attached to the R265-billion budget allocation. On one hand, you have the High Court ruling back in January 2025 that said SASSA was being 'deliberately exclusionary.' And now you have the National Treasury wanting to see have SASSA is reviewing, suspending and cancelling grants to keep the budget in check … It's a little farfetched to expect SASSA SRD R370 applicants to have a smartphone and data for monthly verifications. Image: File Unfortunately, this puts the South African Social Security Agency in a highly compromised position. If it doesn't actively exclude grant recipients, the National Treasury will say conditions to its budget allocation are not being met. However, after the High Court ruling earlier this year, civil society is watching closely to see how the agency 'increases grant inclusivity.' As such, SASSA CEO Themba Matlou told the committee this week that its new review process for social grants will comply with the National Treasury's requirements. The first necessity is a quarterly report, due at the end of July, that proves the number of grants reviewed, suspended, cancelled and money saved by the agency. Meanwhile, it's the elderly who suffer and must travel to SASSA offices to have their identity verified. Image: File Key to the agreement between SASSA and the National Treasury is the agency must improve its income, biometric and governmental verification systems. Meanwhile, it's overtly clear that these new digital processes are impacting poor beneficiaries who don't have access to smartphones and data. Nevertheless, when the National Treasury allocated R265 billion budget to SASSA, it had the following provisos. 'SASSA must introduce bank income checks on grants. It must conduct large-scale database checks at least twice a year. It must finalise agreements with SARS and NSFAS to verify beneficiaries' income. And it must intensify biometric checks on suspicious applications,' reports GroundUp . SASSA's first report is due to the National Treasury next month. Image: File As a result, these reviews have already started being implemented. Specifically, Child Support, Old-Age, Disability and Care Dependency grants were flagged for undisclosed income and alternative forms of identification. Instead of the usual three-month review period, affected individuals had their grants withheld until they completed in-person verification at a SASSA office. However, Matlou and SASSA has come under fire over these latest verification policies. And he told Parliament he is aware of the frustration. 'Through beneficiary education, we emphasise that citizens have a responsibility to assist the government to save money. And beneficiaries need to notify SASSA when their financial circumstances have changed,' explained Matlou. Furthermore, the agency says it will start rolling out service kiosks at offices to help clients with remote biometric identity verification. 'The goal is to make biometrics compulsory for all SASSA applicants, whether you are trying to access the social assistance programme with or without identification,' concluded Matlou. Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1. Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
IOL News
13 hours ago
- IOL News
One step off the greylist, but who's watching the watchdogs?
The announcement from the FATF Plenary in Strasbourg, France, marked a significant milestone for South Africa's beleaguered financial sector. Image: Ron AI BY ALL accounts, South Africa has come a long way since February 2023, when it was placed on the Financial Action Task Force (FATF) greylist over concerns about weak enforcement mechanisms and a lack of political will to combat high-level corruption. Now, nearly two years down the line, the country is on the cusp of delisting after 'substantially completed' all 22 action items set out by the global watchdog. The announcement from the FATF Plenary in Strasbourg, France, marked a significant milestone for South Africa's beleaguered financial sector. The country now awaits an on-site verification visit — a final step before potential delisting at the next FATF Plenary in October 2025. 'This is not just about ticking boxes,' National Treasury said in a recently released statement. 'This is about rebuilding institutions hollowed out during years of state capture, and restoring credibility to our financial systems.' Yet while the technical progress has been lauded internationally, domestic critics warn that celebration may be premature — and that complacency could unravel everything. South Africa's greylisting in 2023 was more than a reputational blow; it was a financial reckoning. Banks faced higher correspondent banking costs, foreign investment slowed, and businesses were forced to navigate an increasingly complex and costly regulatory environment. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ The legacy of state capture — under which law enforcement agencies were deliberately weakened — made the path to compliance long and arduous. But according to the FATF's latest communiqué: 'South Africa has demonstrated a sustained increase in investigations and prosecutions of serious and complex money laundering and the full range of terror financing activities in line with its risk profile.' That turnaround, according to officials, was only possible due to the relentless work of key institutions such as the Directorate for Priority Crime Investigation (DPCI — alias Hawks), the State Security Agency (SSA), and the National Prosecuting Authority (NPA). 'Without their commitment, we would still be floundering,' read the Treasury statement. 'These are the same institutions that were targeted during the Zuma era. To see them rise again is nothing short of remarkable.' The FATF has confirmed that South Africa has met the technical requirements for delisting, but the final verdict rests with the FATF Africa Joint Group, which is set to conduct an on-site visit prior to the October 2025 Plenary. 'The Joint Group will verify that implementation of AML/CFT reforms has begun and is being sustained, and that the necessary political commitment remains in place to sustain implementation in the future,' stated the FATF on June 13. National Treasury confirmed that preparations for the visit were already underway. While Treasury paints a picture of institutional renewal, opposition parties remain deeply skeptical. The DA, now part of the Government of National Unity (GNU), has cautiously welcomed the FATF's upgrade of South Africa's progress but issued a warning against any complacency that could derail the country's full removal. 'While this is an important step, the DA cautions the NPA and our financial regulators against complacency,' DA Deputy Spokesperson on Finance Wendy Alexander said in a statement. 'Exiting the greylist remains subject to a site visit by the FATF ahead of the body's next plenary in October.' Alexander stressed that further delays would only deepen the damage. 'The longer South Africa stays on the greylist, the harder it will be for our banks to do business both domestically and internationally,' she warned, adding that a one-off effort would not be enough. 'Exiting and staying off the greylist requires not once-off window dressing, but sustained change and implementation.' South Africa shares the spotlight with several African nations making strides against financial crime. Mali and Tanzania have been officially delisted from the FATF greylist, while Nigeria, Mozambique, and Burkina Faso were also recognised for having substantially completed their respective action plans.
Eyewitness News
21 hours ago
- Eyewitness News
SA's greylisting a lesson for govt to operate as a whole, says Godongwana
CAPE TOWN - Finance Minister Enoch Godongwana says government has learnt valuable lessons from being greylisted by the global anti-corruption watchdog, the Financial Action Task Force. This includes increased oversight on whether money guised as political party donations is being used for terrorism activities. Addressing a symposium on political funding in Durban on Thursday, Godongwana said being greylisted had been a good challenge for government. Government's investment and trade prospects were said to have been severely dented when it was greylisted by the FATF in February 2023. Since then, the government has been under the whip to tick off 22 action items to prove it's got a grip on the prevention of money laundering and anti-terrorism financing. The country was removed from the notorious FATF list last week, after introducing new legislation and tightening its financial controls. Godongwana said it was the first time an omnibus bill was tabled, that cut across government departments. 'It was a positive development in that sense, in that it taught us how to operate and work as government, as a whole.' Godongwana says he was being alerted by the United States every six months about South African bank accounts being sanctioned on suspicion of financing terrorist activities.
