South Africa Tightens Bolts on Terrorism Financing Laws

Strengthening Anti-Money Laundering Efforts

In a move aimed at bolstering the country’s anti-money laundering and combating terrorism financing efforts, South Africa has passed the General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Act 22 of 2022. This legislation comes into effect on December 31, 2022, making significant amendments to several key laws.

Key Amendments

The amended laws include:

• Enhanced reporting requirements: Financial institutions and nonprofit organisations must report suspicious transactions related to terrorism financing.
• New definitions: Introducing new definitions of “beneficial owner” and “prominent influential person”.
• Increased collaboration: Empowering the Financial Intelligence Centre (FIC) to request information from other government agencies and provide forensic information.
• Improved due diligence: Enhancing due diligence measures for financial institutions and nonprofit organisations.
• Stricter penalties: Increasing penalties for non-compliance with anti-money laundering and combating terrorism financing regulations.

Impact on Industries

The implementation of the new laws is expected to have a significant impact on various industries, including finance, nonprofit organisations, and real estate. Organisations affected by the changes are advised to review their current compliance procedures and make necessary adjustments to meet the new reporting requirements. Failure to comply with the amended laws may result in severe penalties, including fines and reputational damage.

Commitment to Combating Terrorism Financing

The passing of this legislation demonstrates South Africa’s commitment to upholding international standards and protecting its financial system from abuse. The country will continue to work with its international partners to ensure that it is doing everything possible to prevent terrorism financing in South Africa.