Money laundering trends in South Africa
| Pages | 27-41 |
| DOI | https://doi.org/10.1108/13685200310809383 |
| Date | 01 January 2003 |
| Published date | 01 January 2003 |
| Author | Louis de Koker |
| Subject Matter | Accounting & finance |
Money Laundering Trends in South Africa
Louis de Koker
INTRODUCTION
Although money laundering has been a statutory
oence for close on ten years in South Africa,
1
not
much is known about the phenomenon of laundering
in the country. In particular, little is known about the
methods that South African criminals employ to
launder their ill-gotten gains.
This Centre for the Study of Economic Crime
(CenSEC) of RAU University undertook a limited
study to identify major laundering trends in South
Africa. It was the ®rst study of its kind to be under-
taken in South Africa. As a result, it posed a
number of challenges. Classic empirical research in
this ®eld is dicult, if not impossible, because the
activity is inherently secretive in nature. The suspi-
cious transactions reports that have been ®led with
the South African Police Service since 1997
2
are still
too few and too unrepresentative to use as a basis
for such a study. As a result, it was decided to consult
experts in law enforcement and in business on the
knowledge and impressions gained from criminal
and compliance investigations and to base the study
on their perceptions and impressions. To ensure
that the views re¯ected in this study are representative
of trends in South Africa in general, the experts were
invited to a workshop where their views could be
aired and debated and where consensus could be
reached.
The workshop took place at the RAU University
on 5th December, 2001. It was hosted and facilitated
by CenSEC and was supported by the National
Treasury, the Money Laundering Forum of South
Africa, the Compliance Institute of South Africa
and Monash University (South Africa). The work-
shop was primarily funded by the British High
Commission in South Africa. It was attended by a
group of persons who represented 440 years of
experience in combating ®nancial crime in South
Africa. In essence,
3
the report was based on the con-
sensus reached during that workshop. The report
itself was released in March 2002 and it is available
on the website of the CenSEC.
4
This article presents
the ®ndings of the study.
THE LAW
Introduction
The term `money laundering' in South African
criminal law currently
5
refers to a number of dier-
ent oences that can be committed in terms of the
Prevention of Organised Crime Act 121 of 1998
(POCA).
6
The concept also overlaps with certain
common law oences (for instance fraud, forgery
and uttering) and statutory oences (for instance
corruption). Internationally, there is a fair measure
of similarity and conformity amongst the dierent
national laws that give rise to money laundering
oences. This conformity can be ascribed to the in¯u-
ence of international instruments that create duties
regarding the criminalisation of money laundering,
7
the 40 Recommendations of the Financial Action
Task Force and the in¯uence of the Task Force, the
Commonwealth and other international role players
in this ®eld. However, the South African laundering
oences are wider in ambit than similar oences that
are generally encountered internationally. It is there-
fore important to provide an overview of the rele-
vant criminal provisions in South African law
before the trends can be discussed.
The relevant laws
Although intentional launderers have been prose-
cuted successfully in terms of South African
common law as accessories after the fact,
8
South
Africa supplemented its law in this regard with
statutory provisions in the Drugs and Drug Track-
ing Act 140 of 1992. This Act criminalised, inter alia,
the laundering of the proceeds of speci®c drug-
related oences and required the reporting of suspi-
cious transactions involving the proceeds of drug-
related oences. The Proceeds of Crime Act 76 of
1996 broadened the scope of the statutory laundering
provisions to all types of oences. In 1999, the
Proceeds of Crime Act as well as the laundering
provisions of the Drugs and Drug Tracking Act
were repealed when POCA came into eect.
POCA:
Page 27
Journal of Money Laundering Control Ð Vol. 6 No. 1
Journalof Money Laundering Control
Vol.6, No. 1, 2002, pp. 27± 41
#HenryStewart Publications
ISSN1368-5201
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