Defend Truth


Whitewashing greylisting simply won’t cut it, no matter how you slice and dice


Paul Hoffman SC is a director of Accountability Now.

The circumstance that got South Africa greylisted is the failure of the criminal justice administration to deal proactively with the malfeasance involved in the State Capture project of the ANC, both under Zuma and since, as evidenced by ‘covidpreneurism’.

Recent news reports and “sponsored content” in Daily Maverick point to concerted efforts on the part of the minister of finance, Brand SA and even Investec Bank to whitewash away the effects of greylisting of South Africa by the Financial Action Task Force (FATF).

More realistically, the IMF predicts that a minuscule 0.1% increase in GDP can be anticipated in SA in the year ahead. This is disastrous for the poor, will exacerbate unemployment and criminal activity on the part of those desperate to keep body and soul together in the tough climate engendered, at least in part, by greylisting.

Brand SA tries to portray greylisting as a sort of club for countries concerned with “actively reviewing and remedying identified financial sector management gaps”. Brand SA would have us wear greylisting as a badge of honour, totally different from blacklisting which is the fate of “countries deemed non-compliant and are to be treated with suspicion by investors, as their systems have been shown to be open for abuse by launderers of funds for crimes such as terrorism, human trafficking, etc.”

That “etc” covers a multitude of forms of malfeasance, many of which have been identified, but not yet addressed, as a consequence of the work done by the State Capture Commission of Inquiry.

Correctly so, Brand SA identifies the greylisting as “an opportunity for SA to strengthen the fight against financial crimes”. There is a crying need for reform aimed at creating a single independent institution capable of expertly investigating and prosecuting serious corruption in all its forms. We have no such institution nor is there any officially sanctioned current prospect of one being established.

For an anti-corruption body to be regarded as independent it ought to be free of executive influence, interference and impedance.

What do we have?

  • A National Prosecuting Authority that is under the “final responsibility” of the minister of justice with its accounting officer firmly in the department of justice: namely its director general;
  • The Hawks or Directorate of Priority Crime Investigation, a unit in SAPS that answers to the commissioner of police who accounts to the minister of police, the highly questionable Bheki Cele. The Hawks do good work, but not on serious corruption due to these reporting lines;
  • The Special Investigations Unit (SIU), a body which is not part of the criminal justice administration, which can only act if the president issues a proclamation for it to do so in respect of any defined issue and then only in the sphere of civil law; and
  • The Investigating Directorate (ID) of the NPA, created by presidential proclamation without regard to the legislature’s decision to deprive the NPA of all investigative capacity, it is a temporary body to deal with State Capture’s fallout.

What do we have in prospect, now that we have been greylisted?

Structurally speaking, nothing more than the upgrading of the ID into a “permanent” body within the NPA, with all its warts and disabilities. And more money for the criminal justice administration, some of it from the private sector.

That’s it.

No draft legislation has been published at this stage. The drafters are probably scratching their heads, seeking a means of circumventing the division of work in the scheme of the existing legislation and to find a way to prevent a future feral executive from simply closing down the “permanent” ID in the same way as the Zuma administration wasted no time in closing down the Scorpions.

As Gwede Mantashe explained at the time, the closure was because the Scorpions were going after ANC politicians and allegedly “abusing their power” by investigating Zuma himself. The Zuma case lingers on like a bad smell. Far from being an abuse of power, it was an early warning of his proclivity for State Capture.

Of course, more money will be thrown at the existing dysfunctional entities in a vain attempt to address their shortcomings, which have everything to do with their architecture and operational capacity and little to do with their admittedly inadequate funding.

Which self-respecting corruption busters, those with the necessary experience and expertise, will want to work for the gutted and hollowed-out existing institutions, infested as they are with saboteurs planted to keep the impunity of the corrupt in place? The “permanent” ID will have the same disabilities as the NPA and as the Scorpions before them, as pointed out above.

The Hawks have never investigated a “big fish” to the point of a successful prosecution and are never likely to do so. While they are seized with investigation of serious corruption, the prosecutors will not get trial-ready dockets from the Hawks. A successful investigation precedes a successful prosecution like night follows day.

The president, who, in the last five years has morphed from Rama-promises to counter corruption, to Rama-dithering (he found the idea of a Chapter Nine Anti-Corruption body “refreshing” in 2019 and by 2021 he flirted fleetingly with the idea of a new body that reports to Parliament, but these are no longer on the Cabinet’s drawing board) and finally to Rama-phala-paralysis, an incurable condition related to the presence of a great deal of unbanked foreign currency that had no legal business being stitched into and kept in the couches at his farm, Phala Phala, for more than the 30 days the Reserve Bank allows.

The minister of finance, quite rightly, remains in his lane and addresses long-standing problems with the likes of the Habib Bank. While encouraging, this activity does not put enough lipstick on the pig.

It is beyond doubt, despite the manifest skirting of the issue, that the circumstance that got SA greylisted is the failure of the existing criminal justice administration to deal proactively with the malfeasance involved in the State Capture project of the ANC, both under Zuma and since, as evidenced by “covidpreneurism”.

Zweli Mkhize continues to lead a charmed life, untouched by anyone in the criminal justice administration, despite being squarely fingered by the SIU for his involvement in covidpreneurism.

The minister of justice, whose job it is to address getting out of greylisting proactively, does not understand the law applicable. He thinks, and publicly says, that the minority judgment in Glenister II is a reflection of the applicable law. He ignores the law as spelt out loudly and clearly in the joint majority judgment of Deputy Chief Justice Dikgang Moseneke and Justice Edwin Cameron.

Their judgment created a proper FATF-friendly framework for dealing with the corrupt. The main features of the single unit needed are now called the STIRS criteria (Specialised, Trained, Independent, Resourced and Secure in tenure of office.) The cabinet-adopted National Anti-Corruption Strategy affords these criteria a mere footnote, but no matter, it has not been implemented by the Ramaphosa administration as it is based on flawed Zuma-era reasoning.

Useless “fusion centres”, the Anti-Corruption Task Team and similar initiatives have served to dilute rather than strengthen efforts aimed at issuing orange overalls for the seriously corrupt.

The STIRS criteria are binding on government and are ignored at government’s peril.

Investec’s CEO, Richard Wainwright, correctly warns that we need to get off the grey list as soon as possible if we are to avoid its full long-term impact. The harsh truth is that we got onto the greylist because of the lack of capacity of our criminal justice administration to enforce anti-corruption laws properly against those who are politically well-connected and seriously corrupt.

Tinkering with the ID and throwing money at the all-but useless Hawks will not address serious corruption and will not persuade the FATF to remove SA from the greylist.

Instead of government paying lip service to the need for an independent anti-corruption entity that is STIRS compliant, the task at hand is actually to establish one. The necessary draft legislation and draft constitutional amendment have been made available, in 2021, to government by Accountability Now.

So far the executive has turned a blind eye to it. If the blindness continues so will the greylisting, to the detriment of peace, progress and prosperity in SA. DM


Comments - Please in order to comment.

Please peer review 3 community comments before your comment can be posted