Fighting Corruption In SA: FICA Says Nearly R60 Billion Flows Out Of SA illicitly


While the SA treasury battles to cough out money to finance most departments, report from Murray Michell, director of the Financial Intelligence Centre Act (FICA) has it that nearly R60 billion has been smoked out of the country in the 2015-2016 financial year.

Michell who reported the illicit exodus of money out of the country in the past years, said South African government is apparently not able to curb the problem which is now going beyond a manageable state.

The FICA director told a sitting of Parliament that about 9 million suspected transactions were reported to the centre in this financial year with about “2490 products to the value of nearly R58.94 billion” being spread throughout the financial year.

This, according to him, could represent the illicit outflow of money from the country.

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The report of the illicit exodus of cash from the country comes at the time state Defence minister, Nosiviwe Mapisa-Nqakula told the president that all efforts to protect the SA border against rising cross-border crimes have been undermined by lack of financial and man power capacity especially in the army. 

It also came at the time the South Africa Social Security Agency (SASSA) finds itself in a crisis that could affect grant payments scheduled for April 1.

Minister Nosiviwe Mapisa-Nqakula said the increased cross-border crimes that have created heightened tensions between residents and migrants from neighboring countries which cannot be easily addressed because the military is ill-equipped.

One of the issues that got the parliament worried was the fact that neither the police nor the Hawks could confirm whether they were investigating the transactions causing the illicit outflow of money and that neither the FIC nor any other government institution had referred to them.

“This is unacceptable,” an ANC MP said to the police representative present in the house as the MPs call for the police and the Hawks to appear before Parliament within two weeks to inform them whether or not they are investigating the matter or whether there was a comprehensive strategy to curb the outflow.

“Take for example the recent R24 million robbery at OR Tambo Airport. Do the authorities know why the cash was being transported? Are the police in contact with authorities such as the South African Revenue Service or the customs authorities in such investigations?” asked Deputy director-general of the National Treasury, Ismail Momoniat.

Momoniat expressed the treasury’s concern over the fragmented strategies in the fight against the illicit outflow of money. He also wondered whether the law enforcement officers had the ability to stop the outflow or to investigate it.

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City press also reported him saying that it was important that the FIC amendment bill be ratified as soon as possible.

President Jacob Zuma, prior to this time, referred the FICA bill back to Parliament amid concerns over the constitutionality of certain provisions in the bill.

The bill has subsequently been slightly amended and resubmitted to Zuma for his approval as Willie Hofmeyr, the head of the legal affairs division at the National Prosecuting Authority, told Parliament that the NPA knew, for example, of an incident where a syndicate smuggled about R2 billion out of the country in a short time.

“We have over the past two years also seized R200 million in cash – it was unheard of,” Hofmeyr said, adding that there were many weaknesses in the system that urgently needed attention.

He said it was important that all the departments that are part of the criminal justice system, should develop a combined capacity to comprehensively combat the illegal outflow of money.