South Africa's efforts to exit the Financial Action Task Force (FATF) grey list are being hindered by low compliance rates among key sectors, particularly legal practitioners and estate agents.

The FATF placed South Africa on the grey list in February 2023, citing inadequate measures to combat financial crimes. The FIC, which is responsible for overseeing compliance, has seen mixed levels of cooperation from various sectors. While casinos have a 100% compliance rate, legal practitioners and estate agents lag significantly, with compliance rates of 60% and 66%, respectively. Trust and company service providers fare slightly better at 74% and 76%.

The FIC has expressed frustration at the "willful non-compliance" from these sectors, despite multiple reminders and a clear deadlines. This lack of cooperation is not only a regulatory issue but also poses broader economic risks. Staying on the grey list can further harm the country's international standing, affect businesses, and impact ordinary citizens.

The agency has also highlighted the broader issue of financial crimes facilitated by inadequate reporting. Dealers in precious metals and stones, credit providers, and crypto asset service providers have also been slow to comply, even after the extension of deadlines.

In response to the ongoing challenges, the FIC has pledged to increase enforcement efforts. The South African government aims to resolve these issues by mid-2025, hopeful that improved compliance will help lift the country from the grey list, thus providing a much-needed boost to the struggling economy.

The FIC's efforts underscore the importance of thorough and timely compliance in safeguarding the nation's financial integrity. As the country navigates this complex regulatory landscape, increased vigilance and cooperation from all sectors are essential to restoring South Africa's global financial standing.

Lawyers and Estate Agents Impeding South Africa's Exit from The FATF Grey List