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The Financial Action Task Force has a bigger role to play in the fight to protect civil society


Sophie Smit is a legal researcher at the Helen Suzman Foundation.

As South Africa scrambles to meet Financial Action Task Force requirements to get off the greylist, the human rights consequences of legislative changes must be carefully tracked. The task force itself has a duty to ensure that civil society watchdogs are empowered to play a role in this, rather than allow governments to limit civil society rights under the guise of FATF compliance.

While the initial response to South Africa’s greylisting by the Financial Action Task Force (FATF) has been overwhelmingly negative, with concerns about the economic cost to the country, there is reason to be thankful that during the months that preceded the decision, South Africa carefully reconsidered draft legislation directed at FATF requirements which would have significantly curtailed the freedoms of civil society.

South Africa is not the first country to find itself under pressure to introduce new legislation to meet FTAF requirements. Indeed, the FATF has previously been accused of sitting idly by while countries introduce legislation condemned worldwide as beingdetrimental to civic space”,a government tool to silence peaceful critics”, or whichstifles free expression and severely restricts the work of civil society” in order to avoid greylisting status. This has brought the legitimacy of FATF’s work into question as it exclusively attends to deficiencies in anti-money laundering and counterterrorism funding (AML/CTF) legal frameworks, entirely indifferent to the squeezing of civil society and potential rights abuses.

Whether states have mandated legislative changes in compliance with FATF recommendations as a cover for the overregulation of civil society or as a genuine but heavy-handed attempt to avoid economic exclusion, the FATF should not only acknowledge its role but be compelled to speak out when human rights violations follow. This responsibility flows from the nature of the relationship which develops once the threat of being greylisted occurs. The country in question is placed under increased monitoring by the FATF which then works closely with it to rectify identified deficiencies.

Criticism against FATF recommendations and their effects are not new, with a global coordinated response from civil society resulting in the FATF announcing that implicated states should respect human rights and undertake a risk-based assessment. However, simply issuing such a statement is not sufficient and the FATF cannot claim to be an innocent bystander when states enact draconian legislation purportedly to meet FATF requirements. The FATF must take on a role in monitoring its effects on human rights and democracy.

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To leverage its influence and working relationship with greylisted countries, the task force must have civil society participate in its monitoring processes as a legitimate stakeholder in the fight against terrorism, rather than leave civil society to have its voice stifled in the aftermath of restrictive implementation.

In the past year alone, Zimbabwe, Mozambique and South Africa have engaged in legislative processes which threaten the freedoms of civil society in order to find favour with the FATF, with only South Africa ultimately back-pedalling.

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Although the actions taken by these states have gone beyond the FATF’s requirements, and despite calls from Human Rights Watch for the task force to expressly denounce Mozambique’s Draft Law on the Creation, Organisation and Operation of Nonprofit Organisations, it remains silent. This is in line with its poor track record of proactively minimising collateral damage caused in the ostensible pursuit of its aims.

The World Organisation Against Torture initiated a working group on torture and terrorism, which maintains that it is not enough for the FATF simply to state that international human rights law should be respected when states act on its recommendations. Rather, in global recommendations to the FATF, it is asked to act with due diligence and to recognise and apply the principle of “no harm” to human rights defenders and civil society. In adopting this due diligence, the FATF should look to include civil society as key role players in its fight against AML/CTF and issue impact reports on how the implementation of its recommendations affect civil society.

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Importantly, the task force must act when its authority is misappropriated and abused. This can be done by ensuring that all AML/CFT measures are subjected to stringent transparency and accountability mechanisms.

While the FATF’s work may have important aims, it must use the close working relationship required for the achievement of its mandate to observe and protect human rights standards rather than shrink the influence of domestic protectors of democracy. By protecting the space within which civil society operates, the FATF positions itself to not only align itself with domestic “watchdogs” but further ensures that its own recommendations are implemented in an internationally acceptable manner enforcing global standards for the protection of human rights. DM


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