Page 76 - IRMSA Risk Report 2023
P. 76
TOP 5 CHALLENGES TOP 5 RISK TREATMENT OPTIONS AND OPPORTUNITIES
TARGETS ▶
TO ACHIEVING ▶
Illicit trade is thriving because of its links to organised crime, which has become more
sophisticated over the years, making it even more difficult for the already stretched law
enforcement agencies to bring perpetrators to justice.
Already stretched law
enforcement agencies unable Intensified collaborative efforts and the use of a multi-stakeholder approach between
the relevant government departments, agencies, law enforcement, business and
to respond to infringements communities would improve the situation.
and the enforcement of rules 01. In addition, the capacity of the state to lead these efforts should receive priority through
against illicit trade.
the appointment of skilled personnel and the appropriation of budgets that enable
the implementation of effective measures to prevent, detect and effectively prosecute
these crimes.
The successful prosecution of offenders is often a challenge due to, amongst other
Lack of investment in digital reasons, the courts or legal system processing large volumes of cases. There is often
infrastructure required to a backlog that dates back years, impacting the ability to timeously process cases and
support digital services 02.
and lower costs of access secure deterrent sentences. The government needs to prioritise clearing the court-
(communications networks, system backlog, to ensure that offending parties are timeously brought to book.
Further, the rehabilitation and reintegration of past offenders to prevent a return to
data centres, security centres).
illegal activities is necessary.
Illicit activities tend to be penetrative and impact the fibre of society. It is a concern that
A lack of public education and there are no formal measures in place to educate civil society on the impact of the illicit
awareness as to the negative
impact of illicit activities 03. economy, both through formal and informal education systems. Civic organisations
impacting the moral fibre of and professional bodies should assist with providing material and platforms to create
awareness and provide an introduction of material on the dangers of the illicit economy
society.
through the formal education system.
Corruption combined with weak capacity and vested interest neutralises the political
will to decisively address this risk. Instead, corruption has undermined the state’s
Continued endemic corruption
undermining the activities of 04. capacity and provided criminal elements with power and influence over the very
the institutions which are trying institutions meant to combat it. Decisive action should be taken in implementing and
following through the recommendations of the State Capture Report to investigate
to curb illicit trade.
and prosecute perpetrators of systemic corruption. This should serve as a deterrent to
would-be perpetrators.
At the end of 2022, the Financial Action Task Force (FATF) placed South Africa on
the so-called grey list. This was a necessary step for the country to tighten up the
financial system to protect against money laundering and the financing of terrorism and
weapons of mass destruction in line with FATF’s standards. At the end of November
05. 2022, Schedule 1 of the Financial Intelligence Centre Act (FICA, 2001) was amended to
Inadequate transaction add several new categories of accountable institutions for compliance with FICA with
monitoring in the financial significant penalties, including imprisonment for a period not exceeding 15 years or a
sector. fine not exceeding R100-million.
The Financial Intelligence Centre will be monitoring the new accountable institutions,
to ensure compliance, get South Africa off the grey list as soon as possible and reduce
illicit financial transactions.
76 IRMSA RISK REPORT 2023/24
