We welcome the fact that the Minister of Finance, Malusi Gigaba, has signed and gazetted the Financial Intelligence Centre Amendment Act (No. 1 of 2017), which is one of the most important “legislative weapons” in the fight against corruption in South Africa.
However, the battle over the implementation of this legislation is far from over because the implementation of the provision ensuring that “Domestic Prominent Influential Persons”, doing business with the state above a certain threshold amount, will be subjected to enhanced scrutiny by financial institutions, is now going to be delayed until after 02 October 2017.
There is a risk that the process of determining the threshold amount, taken together with the process of generating the required database, may cause an undue delay or even an indefinite delay, in implementing the Financial Intelligence Amendment Act (No. 1 of 2017).
Moreover, an “inter-departmental forum”, which is not provided for in the legislation, and for which there is no authority in law, will be established to replace the “Counter-Money Laundering Advisory Council”.
There are no particulars provided about the establishment of the “inter-departmental forum”, but there is a real risk that it may be dominated by the “security cluster”, and amount to a “power grab” by the “security cluster”, who are desperate to get control of the Financial Intelligence Centre.
The formation of the “inter-departmental forum”, taken together with the delay in implementing the provisions relating to “Domestic Prominent Influential Persons” doing business with the state could have the effect of “defanging” the Financial Intelligence Centre Amendment Act (No. 1 of 2017).
That is why we will write to the Chairperson of the Standing Committee on Finance, Yunus Carrim, requesting that he schedule a hearing on the progress of implementing the Financial Intelligence Centre Act (No. 1 of 2017).