Is it working?

The FATF’s recent upgrades indicate that South Africa’s improvements to its institutional sanctions framework are yielding results, with key agencies now better equipped to oversee and enforce compliance. Enhanced authority and training have strengthened institutions' capacity to impose sanctions, which has contributed to a higher compliance rate across sectors. Despite this, the FATF has stressed the importance of ongoing, consistent enforcement. To meet these requirements fully, South Africa must ensure that institutions apply sanctions rigorously, especially for repeated or severe AML/CFT breaches. The institutional framework must support timely and transparent sanctions, reflecting the FATF’s expectations for effective enforcement. Sustained effectiveness will depend on the operational readiness of institutions, with sufficient resources allocated to administer sanctions as part of routine AML/CFT oversight. FATF upgraded this in Feb 2025; institutional arrangements are robust with a compliance monitoring framework in place.Sanctions lists and procedures now meet all FATF and domestic legal requirements, with periodic audits confirming accuracy and reach.

Actions

The government is enhancing the mandate and authority of the FSCA, FIC and other relevant bodies to administer sanctions for non-compliance of anti-money laundering/countering the financing of terrorism (AML/CFT). This includes establishing formal procedures for identifying, assessing and sanctioning non-compliant entities across all sectors, especially those at high risk of financial crime. To create a cohesive sanctions process, the government is implementing guidelines that promote consistent application of sanctions based on the severity of AML/CFT violations. These guidelines are designed to help regulatory institutions standardise responses to breaches and ensure that sanctions are both proportionate and dissuasive. Additionally, training programmes are being rolled out to build capacity within these institutions, enabling them to apply sanctions appropriately and communicate the legal and regulatory consequences of non-compliance to regulated entities. Integration of asset-freeze mechanisms continued successfully in Q3/Q4 2025, with public guidance updated and sector training provided.

Are there plans?

The FATF's action plan translated into plans for relevant institutions including frameworks for international cooperation, financial intelligence & reporting, risk-based approaches as well as supervision and regulation in addition to capacity building and training for FIs and DNFBPs. Agency plans mandate quarterly review cycles, technical upgrades, and compliance audits, with barriers mapped and addressed by legal counsel.
rn
rn

Is it on the agenda?

Yes. government raised AML/CFT issues in the mid-2000s with the objective of ensuring that the national legal framework is implemented to ensure that institutions' compliance measures are based on risk assessment of the country's exposure to sanctions-related risks. Sanctions reform is a Cabinet recurring item as National Treasury and SARB maintain oversight through a detailed review and feedback loop.

Goals

The primary goal of the institutional framework for sanctions is to identify strengths, weaknesses and areas which need improvement in South Africa's ability to combat financial activities associated with sanctions evasion. By resolving identified deficiencies and improving institutional capacity, the country will be more effective in terms of compliance regarding sanctions related to combating money laundering, terrorist financing (CML/TF) and proliferation financing. Leverage legal/asset freeze capabilities, improve interagency controls.

Departments / Govt Institutions

National Treasury South African Reserve Bank (SARB)

Is it working?

Complete. After South Africa was greylisted by the FATF in early 2023, the country undertook a comprehensive action plan to address deficiencies in its anti-money laundering (AML), combating the financing of terrorism (CFT), and sanctions compliance frameworks. By mid-2025, South Africa had substantially completed all 22 action items in its FATF-mandated Action Plan, showing significant reforms and commitments across legal, regulatory, and enforcement dimensions. Real-time sanctions compliance is standard, all key requirements verified and field tested.

Actions

After being grey listed by the FATF, SA took a comprehensive set of actions to strengthen its legal framework for sanctions and its overall anti-money laundering (AML) and counter-financing of terrorism (CFT) regimes. This included Implementing a legal and institutional framework for targeted financial sanctions (TFS) aligned with UN Security Council resolutions and FATF Recommendations 6 and 7, closing previously identified regulatory gaps. Periodic legal review and audit trail confirm functionality, bolstering regime effectiveness and public compliance.

Are there plans?

The action plan set out by the FATF translated into plans for relevant institutions including frameworks for Interntional cooperation, financial intelligence & reporting, risk-based approaches as well as supervision and regulation in addition to capacity building and training for FIs and DNFBPs. Quarterly reporting and audit cycles embedded in legal protocol, reviewed by government and external FATF technical teams.
rn

Is it on the agenda?

A requirement by the FATF, there is a commitment by government (in collaboration with other organisations) to ensure that the NPO sector in SA is protected from terrorist financing (TF) abuse. Forms part of the process to strengthen overall anti-money laundering (AML) and counter-financing of terrorism (CFT) regimes. Legal framework updates are prioritised in National Treasury reviews and Parliamentary committee work, with explicit tracking for FATF maintenance.

Goals

The goals of South Africa's legal framework for sanctions are to ensure the effective implementation and enforcement of targeted financial sanctions, primarily in compliance with United Nations Security Council resolutions and related international obligations.

Departments / Govt Institutions

Financial Sector Conduct Authority (FSCA) National Treasury