The legal implications of South Africa’s grey-listing for money laundering : analysis and recommendations

Abstract

This article analyses the legal implications of South Africa’s grey-listing by the Financial Action Task Force (FATF) for money laundering in a concise manner. It examines the deficiencies in South Africa’s anti-money laundering and counter-terrorism financing (AML/CFT) regime, which led to its grey-listing, and the measures the country has taken to address them. The article evaluates the effectiveness of South Africa’s AML/CFT framework in combating money laundering, highlighting areas for improvement. It also considers the impact of South Africa’s grey-listing on the country’s financial system, including increased scrutiny from international regulators and potential reputational damage. The article recommends specific legal reforms and policy measures South Africa can adopt to strengthen its AML/CFT regime and enhance its compliance with international standards. These Recommendations cover regulatory oversight, law enforcement cooperation, risk assessment, customer due diligence, and sanctions enforcement. The article provides a practical and policy-oriented guide for policymakers and other South African stakeholders to better understand the legal and regulatory challenges of combating money laundering in a grey-listed jurisdiction and identify strategies for improving the country’s AML/CFT framework.