South Africa's Financial Conduct Authority is increasing its staff and carrying out investigations as part of a crackdown on money laundering and terrorist financing following criticism from international watchdogs, the regulator's chair says. I made it.
The Financial Sector Conduct Authority (FSCA), which is funded through industry tax, has also tripled its 2023-24 budget to 2022-23 to fund business expansion, Unati Kamrana said in an interview. He said that the amount has been increased.
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The initiative comes after the Global Financial Action Task Force (FATF) last year placed South Africa on its “grey list” of countries subject to special monitoring over the implementation of standards to prevent money laundering and the financing of terrorism. The aim is to correct the deficiencies pointed out.
South Africa is working to exit the gray list in 2025.
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Mr Kamrana said the FSCA's supervisory capacity had more than doubled in the past two financial years and “we expect it to double again next year”.
“We were seven people and will probably be around 36 by 2025,” he added.
Kamrana said authorities have increased their supervisory activity by 300% this year and are aiming to impose higher fines for violations of money laundering and terrorist financing rules.
Read: Ashburton launches improvement program as FSCA imposes R16 million fine
“We're getting pretty good cooperation from financial institutions,” he said. “I think the financial industry is well aware of the need to address issues around gray listings, and we look forward to building on the progress we have made so far and making further progress this year.”
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The FSCA is also working on regulating cryptocurrencies after they come under its purview in 2022.
Kamrana said the authority has received around 340 applications for virtual currency licenses across different types of business models, including exchanges, and is evaluating them.
“We expect to be able to obtain around 60 of these licenses by the end of March, after which we will be able to move forward with the remaining cases,” he said.
On Thursday, National Treasury announced that it had confirmed that five of the 22 actions identified by the FATF have been addressed or are close to being addressed.
“While South Africa is on track to address all outstanding action items, addressing all 17 remaining action items by February 2025 remains a challenge,” Treasury said.
