Question NW3547 to the Minister of Finance
11 December 2023 - NW3547
Manyi, Mr M to ask the Minister of Finance
(1) Noting that the Financial Action Task Force (FATF) listed money laundering as one of the reasons to greylist the Republic, what (a) is the total monetary value of illicit financial flows (i) to and (ii) from the Republic and (b) total amount of the illicit financial transactions were conducted (i) in cash and (ii) electronically; (2) what are the (a) specific areas that need improvement to combat money laundering as identified by the FATF and (b) details of the progress that National Treasury has made in fixing the specified areas in relation to the target
Reply:
1. Please note that responses on the greylisting of the country by the Financial Action Task Force has been provided including a response relating to illicit financial flows. Please refer to PQ943, PQ3967, PQ2641, PQ2642 and PQ4712.
In PQ4712, the following was indicated, the United Nations Economic Commission for Africa and the United Nations Conference on Trade and Development UNCTAD were running a 12-country pilot on the building of in-country capacity on the measurement of Illicit Financial Flows, with the pilot later being expanded to 22 countries, of which South Africa was one of the pilot member countries. The pilot has only produced unofficial estimates.
2. The areas that were identified by the FATF when it greylisted South Africa are listed in National Treasury’s media statement (https://www.treasury.gov.za/comm_media/press/2023/2023022401%20Media%20statement%20-%20Response%20to%20FATF.pdf which was published by
National Treasury on 24 February 2023. Furthermore, as indicated in the Medium-Term Budget Policy Statement on 1 November 2023, since the greylisting of the country by the FATF in February 2023, a large number of government departments and agencies – including SAPS, the Hawks, NPA, SIU, SSA, SARB, FSCA, and SARS – have been working hard to address the deficiencies. The FATF noted during its plenary meeting on 27 October 2023 that the work is showing positive results, with South Africa having addressed 15 of the 20 technical deficiencies in our legal framework and making good progress on 17 of the 22 effectiveness action items, including 2 that are now deemed to be largely addressed.