Ismail Momoniat, who led South Africa’s efforts to get off the Financial Action Task Force (FATF) greylist, has hailed the exit as a positive development for the country’s economy and its aspirations of fighting corruption.
“Other countries can place more confidence in the fact that the South African authorities are acting against money laundering and terrorism financing, and that means that overseas banks will be more comfortable with trading with South African banks, and that will be good for investment and economic growth,” Momoniat told Business Times on Friday.
“It will also demonstrate to the world that we are beginning to do something about fraud and corruption. It doesn’t mean that we have solved all of our problems; far from it, if you look at the Madlanga commission.”
Momoniat’s remarks came shortly after the FATF, which leads global action to combat money laundering and terrorist and proliferation financing, announced in Paris on Friday that South Africa and three other African countries were being removed from the greylist.
South Africa was greylisted in 2023, after the FATF noted gaps and deficiencies in the country’s mechanisms to combat money laundering and terror financing, among others.
“The countries [removed from the greylist] are Burkina Faso, Mozambique, Nigeria and South Africa,” said FATF president Elisa de Anda Madrazo. “Some of the actions taken by these jurisdictions include, in the case of South Africa, sharpening tools to detect money laundering and terror financing.”
The countries [removed from the greylist] are Burkina Faso, Mozambique, Nigeria and South Africa,” said FATF president Elisa de Anda Madrazo. “Some of the actions taken by these jurisdictions include, in the case of South Africa, sharpening tools to detect money laundering and terror financing.
She said sustained efforts across authorities and networks had helped South Africa and other nations leave the greylist and enhance their detection and enforcement capabilities.
Momoniat said attention would now shift to the FATF’s mutual evaluation, which begins in the middle of next year. It is at the mutual evaluation that South Africa will have to demonstrate that the gains it has made in its interventions have been sustained.
He said it was time for all the relevant institutions in the country to contribute to maximising the opportunity that the removal from the greylist presented.
“It’s been humiliating to get on the greylist, and we are getting back to normal. Our normal is not good enough cause corruption is high. We are going to have to do much, much more to make it impossible for people to conduct corruption and ensure that there are consequences for those who do.”
The National Treasury said in a statement the country’s exit from the greylist was a demonstration of a commitment to rebuilding the rule of law, but it was only the start of a broader process to continue strengthening key institutions, enforcement and governance.
“[It is only the start of] processes, and ensures that such improvements are sustainable and that our systems become increasingly effective in combating money laundering, terrorism financing and proliferation financing. Neither government agencies nor regulated entities in the private sector can afford to become complacent and stop improving,” the Treasury said.
Leonard Roberts, CEO of advisory firm Moore Infinity, said South Africa’s removal from the greylist was welcome news and should be seen as a crucial opportunity to “lock in the compliance muscle that the country has built” to make South African businesses more attractive to investors.
“Delisting validates the hard work that government and business have put in to be globally compliant, and opens the door to greater capital flows,” he said. “Celebration is in order. But to convert the opportunity, we must use our world-class compliance as a springboard back into the global investment arena.”
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