National Treasury has allocated additional funding of more than R265 million to the Financial Intelligence Centre (FIC) to fight organised and financial crime over the medium term.
Delivering his budget vote speech in the National Assembly on 16 May, Finance Minister Enoch Godongwana said the funding will be used to implement the Financial Action Task Force’s recommendations.
“National Treasury, as the lead in the Interdepartmental Committee on Anti-Money Laundering and the Combating of the Financing of Terrorism, continues to co-ordinate government-wide efforts to comprehensively address the remaining weaknesses in our legal system,” Godongwana said.
For example, Godongwana, the authorities have frozen the assets of individuals and entities designated by the United Nations to be linked to ISIS, the Taliban, and al Qaeda.
Systems for supervising non-financial businesses that are at risk of being used for money laundering or the financing of terrorism have been updated and strengthened.
“We have also strengthened the systems needed to identify the beneficial owners of business and trusts so that they cannot hide behind the veil of corporate secrecy when engaged in money laundering.”
Godongwana said these developments have been submitted to the FATF, “and a positive re-ratings of the country’s technical compliance with the FATF standards can be expected in the next six months”.
In April, the FIC said the R265m had helped to fund the establishment of its new state forensic capability (SFC), which will enhance the state’s ability to investigate and prosecute complex financial crimes.
The SFC will see specialised resources in forensic accounting, financial analysis and related services working together to support the work of law enforcement and other authorities in their pursuit of high-priority criminal matters.
“As a result of SA being grey-listed, and as part of the FATF action plan, the police are expected to send more requests to the FIC for financial intelligence,” the FIC said.
“The SFC unit will be able to produce forensic reports that law enforcement agencies can use in complex money-laundering cases. This unit will also be available to go to court and testify on the financial flows and the forensic products they share with law enforcement agencies, such as the police and prosecutors.”
The SFC initiative, which was established in the FIC with effect from April 1, is the culmination of work begun in October 2020 by officials from agencies in the Anti-Corruption Task Team, which is co-chaired by Hawks head Godfrey Lebeya and the national director of public prosecutions, Shamila Batohi. It includes the FIC, the Special Investigating Unit, the Investigating Directorate of the National Prosecuting Authority, the Asset Forfeiture Unit, the South African Police Service, SAPS crime intelligence, and the State Security Agency.
It is expected that the set-up phase for the SFC will take six months, with the capability being launched as fully operational by month seven.
