Red flags around greylisting

SA has been in the naughty corner of the world's money laundering and terrorist funding watchdog for going on three years. In a rare bit of good news for our struggling economy, all the signals are that at its plenary next week, the Financial Action Task Force (FATF) will remove us from its greylisting.

- William Saunderson-Meyer

That is unless US President Donald Trump throws a spanner in the works. Or Israel.

Greylisting flags that a country's legislative architecture has failed at containing corruption, money laundering and cross-border financial flows to criminals, terrorist organisations and rogue states.

The lifting of the FATF sanction is eager ly anticipated by the ANC-led government of national unity (GNU) and the financial sector. Treasury officials, politicians and analysts have read the smoke signals. In June, FATF conducted an in-country visit and found that, on paper, South Africa had substantially completed all 22 action items flagged by FATF.

It should be straightforward, with the champagne already on ice, were it not for two snags. First, ticking the boxes on technical compliance isn't the same as proving effectiveness. Second, the FATF plenary decides by consensus, not by a majority of its 38 members. If any member - think the US or Israel - baulks at the recommendation, SA remains in the cold.