SOUTH AFRICA
After the Bell: The link between greylisting and getting our money back from the Guptas
Ajay and Atul Gupta. (Photos: Gallo Images / Martin Rhodes / Robert Tshabalala)
By Tim Cohen
29 Feb 2024
DAILY MAVERICK
The question is how South Africa can demonstrate to the Financial Action Task Force that it is serious about bringing the corrupt to book when the chief players in State Capture have got off scot-free
Do you remember the Guptas? Ajay, Atul and Rajesh (or Tony as he was known) – do any of us still remember them?
The trio waltzed in from India, bought themselves a few politicians and then whisked their (our) money out to Dubai.
It’s all fading dimly into history now. Can you believe that it’s been eight years since they high-tailed it out of SA, leaving behind a trail of broken dreams, broken politicians, and broken promises? I mean it’s like a bad country-and-western song.
There are so many things about the Gupta story that are almost unbelievable, you have to pinch yourself to remember what transpired. Just a quick refresher: the Zondo commission found that of the R57-billion in public funds “tainted” by State Capture, R15.5-billion of them “belongs” to the Guptas.
It is incredible that they did it – the sheer audacity! It is also incredible that they managed to fleece South Africans of that much money. But the most incredible thing of all is that it’s increasingly clear they got away with it.
It reminds me of that old saying, if you owe the bank a million rand; you have a problem. But if you owe the bank a billion rand; they have a problem. At a certain scale, the shoe slips off your foot and onto the foot of your interlocutor.
I don’t want to say I knew they would get away with it, but I did have my suspicions. The problem now is that if they are caught (and extradited), then the ANC would have to face years of reporting on a trial. Suddenly, it becomes important not only for the Guptas to get away with it, but also for the governing party.
Of course, there are consequences. Internationally, governments have just had it with this stuff and have been applying the screws to countries where it’s possible to “capture” billions of dollars, move that quantity of money around the world with gusto, and, you know, get away with it. So SA is now involved in this embarrassing process of trying to get off the Financial Action Task Force (FATF) greylist. How is it going?
Well, Treasury put out a report just this morning and, reading between the lines, it’s not going that well.
At the start of the process, 22 action items linked to the strategic deficiencies were identified in the Anti-Money Laundering and the Combating of the Financing of Terrorism regime, Treasury says. Should SA be assessed to have largely addressed all 22 action items by February 2025, the FATF will schedule an onsite visit in April/May 2025 to confirm that assessment and make a recommendation to the June 2025 FATF plenary.
In other words, it’s going to be at least a year and a bit before (if) SA gets off the list. Treasury noted that at the FATF meeting that has just taken place, the organisation confirmed that five of the 22 action items have now been addressed or largely addressed. TBH, that’s not a huge amount of progress since SA was greylisted a year ago. But the good news is that the FATF has agreed that 14 of the 17 outstanding action items have now been partly addressed.
That means three action items still have not been addressed at all yet. What are those items? Well, as you can imagine, they are the important ones. The report doesn’t mention which three in particular, but it’s pretty easy to draw your own conclusions because the deadline for the four items is set for January 2025, so presumably they are the toughies.
One of the four is this “South Africa should demonstrate a sustained increase in investigations and prosecutions of serious and complex money laundering, in particular involving professional money laundering networks/enablers and third-party ML in line with its risk profile”. Two of the others are along the same lines. One other says, “South Africa should demonstrate a sustained increase in the effective identification, investigation and prosecution of the full range of TF [terrorism financing] activities, consistent with its TF risk profile.”
The problem here is that this is not about promising to do something, but actually doing something. And as we know, SA is excellent in the promising department, but not so good in the actually doing department. And it’s not Treasury alone that can do this, but Treasury in concert with the cops and the justice department.
You get a sense that Treasury recognises this problem because it noted this morning that while SA is on track, “it remains a tough challenge to address all 17 of the remaining action items by February 2025”. In other words, it’s probably not going to happen.
But listen, there is good news, too: the FATF has just taken the United Arab Emirates off the greylist. Is it possible we could just ask them to track down our money? Asking for a friend. DM
The question is how South Africa can demonstrate to the Financial Action Task Force that it is serious about bringing the corrupt to book when the chief players in State Capture have got off scot-free
Do you remember the Guptas? Ajay, Atul and Rajesh (or Tony as he was known) – do any of us still remember them?
The trio waltzed in from India, bought themselves a few politicians and then whisked their (our) money out to Dubai.
It’s all fading dimly into history now. Can you believe that it’s been eight years since they high-tailed it out of SA, leaving behind a trail of broken dreams, broken politicians, and broken promises? I mean it’s like a bad country-and-western song.
There are so many things about the Gupta story that are almost unbelievable, you have to pinch yourself to remember what transpired. Just a quick refresher: the Zondo commission found that of the R57-billion in public funds “tainted” by State Capture, R15.5-billion of them “belongs” to the Guptas.
It is incredible that they did it – the sheer audacity! It is also incredible that they managed to fleece South Africans of that much money. But the most incredible thing of all is that it’s increasingly clear they got away with it.
It reminds me of that old saying, if you owe the bank a million rand; you have a problem. But if you owe the bank a billion rand; they have a problem. At a certain scale, the shoe slips off your foot and onto the foot of your interlocutor.
I don’t want to say I knew they would get away with it, but I did have my suspicions. The problem now is that if they are caught (and extradited), then the ANC would have to face years of reporting on a trial. Suddenly, it becomes important not only for the Guptas to get away with it, but also for the governing party.
Of course, there are consequences. Internationally, governments have just had it with this stuff and have been applying the screws to countries where it’s possible to “capture” billions of dollars, move that quantity of money around the world with gusto, and, you know, get away with it. So SA is now involved in this embarrassing process of trying to get off the Financial Action Task Force (FATF) greylist. How is it going?
Well, Treasury put out a report just this morning and, reading between the lines, it’s not going that well.
At the start of the process, 22 action items linked to the strategic deficiencies were identified in the Anti-Money Laundering and the Combating of the Financing of Terrorism regime, Treasury says. Should SA be assessed to have largely addressed all 22 action items by February 2025, the FATF will schedule an onsite visit in April/May 2025 to confirm that assessment and make a recommendation to the June 2025 FATF plenary.
In other words, it’s going to be at least a year and a bit before (if) SA gets off the list. Treasury noted that at the FATF meeting that has just taken place, the organisation confirmed that five of the 22 action items have now been addressed or largely addressed. TBH, that’s not a huge amount of progress since SA was greylisted a year ago. But the good news is that the FATF has agreed that 14 of the 17 outstanding action items have now been partly addressed.
That means three action items still have not been addressed at all yet. What are those items? Well, as you can imagine, they are the important ones. The report doesn’t mention which three in particular, but it’s pretty easy to draw your own conclusions because the deadline for the four items is set for January 2025, so presumably they are the toughies.
One of the four is this “South Africa should demonstrate a sustained increase in investigations and prosecutions of serious and complex money laundering, in particular involving professional money laundering networks/enablers and third-party ML in line with its risk profile”. Two of the others are along the same lines. One other says, “South Africa should demonstrate a sustained increase in the effective identification, investigation and prosecution of the full range of TF [terrorism financing] activities, consistent with its TF risk profile.”
The problem here is that this is not about promising to do something, but actually doing something. And as we know, SA is excellent in the promising department, but not so good in the actually doing department. And it’s not Treasury alone that can do this, but Treasury in concert with the cops and the justice department.
You get a sense that Treasury recognises this problem because it noted this morning that while SA is on track, “it remains a tough challenge to address all 17 of the remaining action items by February 2025”. In other words, it’s probably not going to happen.
But listen, there is good news, too: the FATF has just taken the United Arab Emirates off the greylist. Is it possible we could just ask them to track down our money? Asking for a friend. DM
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