The Financial Action Task Force greylisted South Africa due to its failure to comply with its standards and measures.
The Financial Action Task Force concluded its on-site assessment of South Africa during the last week of July, the last step before the October 2025 Plenary can consider whether to remove South Africa from its grey list.
Countries must comply with the Financial Action Task Force (FATF) standards and measures to combat illicit financial flows, terrorist funding and potential threats to the integrity of the global financial system.
The FATF is an intergovernmental body established to protect financial systems and the broader economy from threats of money laundering and the financing of terrorism.
Greylisting subjects the financial services sector to increased scrutiny and stricter regulations to ensure that it addresses the deficiencies in its anti-money laundering and counterterrorism financing systems. It serves as an early indication that the country’s financial system is at risk of misuse for illegal purposes, Bianca Botes, director at Citadel Global, said at the time.
“The logical consequence is detrimental to South Africa’s international reputation as it is seen as a high-risk jurisdiction for financial transactions, making countries hesitant to engage in financial and law enforcement cooperation.”
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SA had to upgrade laws for Financial Action Task Force
South Africa had to upgrade its anti-money laundering and counterterrorism laws and regulations, implement improved supervision of financial institutions and enhance the country’s ability to investigate and prosecute money laundering and terrorism cases.
In addition, South Africa had to complete this by January this year, but problems with compliance on the side of some estate agents and lawyers slowed the process down. However, the FATF announced in June that the country had substantially completed all 22 action items in the action plan adopted.
The FATF decision noted that South Africa’s progress warrants an on-site assessment to verify that critical reforms, including anti-money laundering and the combating of the financing of terrorism reforms, have been implemented and that the necessary political commitment remains in place to sustain progress.
The FATF Joint Group held meetings with South African government officials and representatives of financial institutions and designated non-bank financial institutions. At the conclusion of the meetings, the FATF Africa Joint Group held a meeting with Deputy Minister of Finance David Masondo and Deputy Minister of Justice and Constitutional Development Andries Nel.
They assured the FATF of government’s commitment to continue to improve the country’s anti-money laundering and the combating of the financing of terrorism (AML/CFT) system.
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All eyes now on FATF meeting
After the onsite visit, the FATF Africa Joint Group will submit a report to the October 2025 FATF Plenary, which will consider any recommendations from the report on whether South Africa can be delisted from the FATF grey list.
According to a statement from National Treasury, Masondo and Nel assured the FATF Africa Joint Group that government will continue to actively partner with the FATF Global Network in preserving and advancing the integrity of the South African and global financial systems.