SA faces tougher FATF review as Madlanga allegations mount

National Treasury technical advisor Ismail Momoniat says while the upcoming FATF evaluation poses a challenge, it’s also an opportunity for SA to fix its systems and ensure the country does better against financial crime. Picture: Gallo Images/ Foto24/Denvor de Wee Damning allegations surfacing at the Madlanga Commission of Inquiry could cast a shadow over South Africa’s next anti-money laundering assessment by the Financial Action Task Force (FATF). National Treasury technical advisor and former acting director-general Ismail Momoniat warned members of parliament’s Standing Committee on Finance on Tuesday that the country’s ability to investigate organised crime, successfully prosecute and recover criminal assets could come under the spotlight if weaknesses in law enforcement persist.

High-ranking officials appearing before the Madlanga Commission in recent months have testified about sophisticated organised crime networks that allegedly infiltrated law enforcement, intelligence structures and metro police to obstruct justice and facilitate drug syndicates. “Clearly, I think the events at the Madlanga Commission and the ability of the country to deal with organised crime – particularly if many of our top police are implicated in their links to organised crime – impacts on South Africa,” Momoniat said. South Africa exited the FATF grey list in October 2025, but the next assessment has already begun.

Chris Axelson, deputy director-general of tax and financial sector policy at National Treasury, told MPs that the country’s 18-month mutual evaluation process is underway and will be broader and tougher than the previous review. Great emphasis will be on proving that anti-money laundering measures work in practice rather than simply complying with international standards. The effectiveness component of the evaluation is assessed through 11 so-called “Immediate Outcomes”, which measure whether authorities are achieving tangible results with financial intelligence, investigations, prosecutions, convictions and the recovery of criminal assets.

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Momoniat said some of the toughest measures South Africa will face in the upcoming FATF mutual evaluation relate directly to the country’s ability to investigate and prosecute financial crime. “They are Immediate Outcome 7, which is about investigations, prosecutions and convictions with regard to money laundering, and there’s one for terror financing as well.

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