South African corruption and the FATF

This article from The Hill, highlights the importance of finances in addressing corruption. In the past, when Nelson Mandela first came into power, it was a symbol of hope and freedom South Africa but now it has become a permissive environment for an entire host of corrupt actions. This has included ”creating a permissive environment for transnational crime and other malign influences, high levels of corruption have brought about general economic malaise and youth unemployment running higher than 60 percent.” Additionally, it has a reputation for laundering moneys and moving weapons to many unsavory countries. This has meant that because of evidence of these behaviors and actions, the Financial Action Task Force (FATF), an intergovernmental watchdog for money laundering and terror finance, has placed South Africa on its’ “grey list”. This signifies increased illicit finance risk, meaning banks and businesses typically approach listed countries with more caution and often reduce investment in those jurisdictions, and this will be coming up for review at the next plenary session.

Why should we care and what should we do? We should care as South Africa has had weak prosecutions, political interference and unchecked corruption, There have been numerous reports and many people have been implicated in corruption, but prosecuting authorities and financial intelligence services lack support and political backing. Banks implicated in money laundering face minimal penalties, while courts remain are overloaded and politicized. Many people have been assassinated for exposing corruption and illicit finance and  five prosecutors have been murdered in South Africa in the last five years alone. This is a horrible situation and with these scenarios, South Africa must not be taken off the grey list, and civil society and donor countries must keep up the pressure.

Link:

https://thehill.com/opinion/international/5524689-fatf-grey-list-south-africa/