South Africa

The Financial Action Task Force grey-listed South Africa in January 2023 and placed the country on a watchlist.

“The Financial Action Task Force, which grey-listed South Africa in January 2023, has had us on a watch list.”

Mr Adams filed an affidavit on January 6, 2025, alleging anonymous information about fraud and corruption within Crime Intelligence involving high-ranking police officials manipulating promotional and security vetting processes to benefit a civilian appointed as brigadier despite no policing or management experience.

“On or about early October 2024, I received information anonymously surrounding alleged fraud and corruption being perpetrated within Crime Intelligence ... manipulating promotional and security vetting processes to unduly benefit a civilian person ... appointed as a Brigadier in South Africa ... no policing experience and no management experience and was appointed as Head of the technical support service.”

Mr Asif Muhammad arrived in South Africa in 1998 as an undocumented immigrant from Pakistan and began a small shop where he was later extorted and demanded bribes by Mr Bellochun who also sold counterfeit cigarettes and helped obtain fraudulent South African identity documents.

“he arrived in South Africa in 1998 as an undocumented immigrant from Pakistan ... he was pulled over by Mr Bellochun for driving without a licence ... Mr Bellochun demanded a bribe ... Mr Bellochun began extorting money from Mr Asif Muhammad as well as other Pakistani shopkeepers ... Mr Bellochun participated in unlawful activities such as selling counterfeit cigarettes and ... assisted some Pakistani nationals to obtain fraudulent South African identity documents in exchange for money.”

There are existing rules in South Africa, such as the Public Administration Management Act, that restrict public servants from doing business with the state to prevent conflicts of interest.

“So I believe it is the Public Administration Management Act that introduces this restriction which effectively says that public servants of the public sector is not allowed to do business with the state.”

South Africa has been working on anti-money laundering reforms including beneficial ownership registers for companies and property to address investigatory difficulties.

“South Africa has been working on leaving the grey list in terms of the anti-money laundering requirements and the standards set by the Financial Action Task Force. ... a lot of the amendments introduced as part of those reforms were around introducing beneficial ownership registers for companies, for property and even in the case of trusts determining who is the ultimate beneficiary of an asset”

South Africa's financial disclosure form should be tailored to the country's specific context, corruption challenges, and scale, rather than directly adopting maximalist international best practices.

“In high income countries they do not have this kind of disclosure requirement and that might be the case because the level of corruption and the kinds of challenges that they deal with do not necessarily warrant that kind of level of disclosure and invasion of privacy... these issues should always be tailored to your specific context, to your specific challenges, the scale of the corruption issue that you have in a country.”

The StAR document titled 'Asset and interest disclosure: A technical guide to an effective form' provides comprehensive best practice guidance for disclosure forms including considerations like intellectual property rights, and is relevant for South Africa.

“It is the StAR document, it is titled: 'Asset and interest disclosure: A technical guide to an effective form.'... this particular form will include every type of imaginable type of asset... I think there are some universal principles that I think makes sense in every jurisdiction and I think questions around beneficial ownership, the family member question, I think are particularly important and I think are very relevant to the South African context.”

The recent StAR report assesses South Africa's financial disclosure form and e-disclosure system, identifying omissions and priorities to improve them according to international standards and good practice.

“This was an assessment conducted at the request of the Department of Public Service and Administration to both look at the form as well as the e-disclosure system and how it functions currently... to assess the current form against these international standards and good practice to determine what are some of the omissions in the South African context currently that should be considered and some of the priorities.”

Document 311 in the bundle specifically addresses South Africa's Financial Disclosure Form and E-Disclosure System of South Africa.

“311 is where you start, where the documents start addressing South Africa specifically. 311 is “Financial Disclosure Form and E-Disclosure System of South Africa”.”

The current framework addressing corruption prevention in South Africa is fragmentary and incremental approaches have reached limitations; a substantive overhaul with a dedicated corruption prevention agency is needed.

“a lot of the fragmentation and weaknesses that we see in the current framework are a result of incremental attempts to improve the system ... the system in its current form has reached the limit of incremental improvements and has reached a point where you need the more substantive overhaul of how these functions are dispersed”

Documents specific to South Africa diagnose challenges, present international examples, and recommend measures including sanctions and the creation of a dedicated corruption prevention agency with functions on financial disclosure and conflict of interest management.

“the documents that I have mentioned that are written particular to the South African context ... introduces the international examples of how such measures are implemented in other countries and will usually end with recommendations ... suggestions for what we believe a dedicated corruption prevention agency could look like and it builds on NACAC's recommendations to add on some additional functions in terms of financial disclosure , conflict of interest management , etcetera”

Public disclosure is not foreign to South Africa and is already practiced in isolated cases such as in the local government financial disclosure framework where discretion exists to make disclosures public.

“the idea of public disclosure, it is not foreign in South Africa. It is something we already do in isolated cases ... in the local government framework, there is discretion to make financial disclosures public”

A middle group within an organization may not be extremely ethical or unethical, they might turn a blind eye to misconduct to avoid involvement, and ethical behavior must be enforced through rule-based mechanisms to restore integrity in public sector organizations including SAPS.

“n e i t h e r e x t r e m e l y e t h i c a l n o r u n e t h i c a l . T h i s i s a g r o u p o f p e o p l e t h a t g o a l o n g w i t h w h a t t h e c u l t u r a l n o r m i s ... A n d s o h e m a k e s t h e a r g u m e n t t h a t t o s w i t c h t h e o r g a n i z a t i o n a l c u l t u r e , t o w i n o v e r t h i s m i d d l e ... t o r e s t o r e e t h i c s ... through rule-based following and that is the kind of approach that I think that South Africa should be focusing on , I think particularly within SAPS , but as the broader public sector as well ...”

There are multiple, differing financial disclosure frameworks across South Africa's public service, leading to inconsistent standards, inefficiencies, and dispersed investigative capacity.

“a r e m a n y d i f f e r e n t d i s c l o s u r e f r a m e w o r k s . M e m b e r s o f p a r l i a m e n t h a v e a d i s t i n c t f r a m e w o r k ... E x e c u t i v e ... J u d i c i a r y ... L o c a l G o v e r n m e n t ... I n c o n s i s t e n t s t a n d a r d s ... d i s p e r s e d a c r o s s ... i n e f f i c i e n c i e s ...”

The President Mr Ramaphosa approves the Just Energy Transition Framework, a move away from fossil fuels to sustainable energy, with a financial implication of $8.5 billion approved for this transition.

“Media announcement of the President, Mr Ramaphosa, approving the Just Energy Transition Framework, which is a move away from fossil fuels to sustainable energy sources. South Africa approves $8.5 billion plan to move away from coal.”

Tax Justice South Africa (TJSA) has independently investigated illicit tobacco trade and will soon release reports exposing large scale tax evasion and crime robbing South African citizens of billions of rands.

“Tax Justice South Africa ... has been conducting research independently into the illicit trade over recent months and will be releasing our reports soon ... a wake-up call to the authorities ... South Africa cannot afford this industrial-scale looting to continue a single day longer ... Tax Justice SA has uncovered breathtaking new details about the crime wave sweeping South Africa and robbing honest, hard-working citizens of billions of rand.”

South Africa has approximately 72 border posts creating substantial policing challenges relating to drug trafficking.

“South Africa has approximately 72 border posts, which creates a substantial policing challenge in relation to drug trafficking.”

South Africa has a very extensive coastline that facilitates transfer of drugs from larger vessels to smaller vessels that can go ashore at very small harbours or beaches making drug trafficking easier.

“We also have a very extensive coastline in the Republic that further facilitates the transfer of drugs, for example, consignments of drugs from larger vessels to smaller vessels. And these smaller vessels can then go ashore at very small harbours or even on the beach, for that matter, if that craft is small enough.”

Inside the black canvas bag is a brick wrapped in plastic with a picture on it, specifically a red bull insignia linked to a drug syndicate's specific request for products exported into South Africa.

“inside the black canvas bag is this brick that is also wrapped in plastic”

There has been no prosecution in South Africa up to date related to the seizure of 541 kilograms of cocaine on 8 May 2020.

“There was no prosecution up to date in South Africa, Commissioners.”

Cocaine and heroin enter South Africa commonly through established transnational maritime routes involving multiple countries and are produced mainly in South American countries and Afghanistan.

“Cocaine and heroin enter South Africa commonly through established transnational maritime routes involving multiple countries. Cocaine is typically transported from South America via West Africa. Heroin is commonly transported from regions such as Afghanistan through East Africa like Mozambique and into South Africa.”

Cocaine and heroin are smuggled into South Africa primarily for the local market but also repackaged for onward trafficking overseas, usually to Europe. Port authorities are vigilant about vessels from the Port of Santos due to drug trafficking prevalence. Successful entry into Europe is more likely if the consignment is rerouted through less suspicious countries before onward movement to Europe.

“Cocaine and heroin are smuggled into the country primarily for the local market but is also repackaged for onward trafficking to another country. In other words, the criminal grouping in South Africa would assist in repackaging the drugs to make it easier for onwards smuggling to another country, usually to Europe. Port authorities are particularly vigilant when vessels arrive from Port of Santos because of the prevalence of drug trafficking from that port. Successful entry into Europe is more likely if the consignment is rerouted to less suspicious countries before onwards movement to Europe.”

Synthetic drugs in South Africa are made by chemical processes rather than derived from natural plants, with chemicals sourced through lawful supply chains but diverted for unlawful purposes. Controlled substances used to manufacture synthetic drugs are also imported illegally or smuggled into South Africa. The most prevalent synthetic drugs are methamphetamine (crystal meth or tik), and methaqualone (Mandrax). Facilities producing synthetic drugs are called clandestine drug laboratories (CDLs), including super labs and kitchen labs. Kitchen labs are often located in businesses or residential areas and use readily available equipment like stoves.

“Synthetic drugs are manufactured through chemical processes rather than derived from natural plants sources. In many instances, since they are not classified as controlled substances in South Africa, the chemicals used to manufacture the drug are sourced through lawful supply chains but are then diverted or misused for unlawful purposes. Controlled substances are also imported illegally or smuggled into South Africa. The most prevalent synthetic drugs in the country are methamphetamine, known as crystal meth or tik, methaqualone, known as mandrax. Synthetic drugs are manufactured at what is referred to as clandestine drug laboratories or CDLs. There are super labs and kitchen labs. Kitchen labs are found in businesses and residential areas and the equipment used to manufacture the drugs are the readily available equipment such as stoves and other kitchen equipment or appliances.”

Methamphetamine manufacture in South Africa uses controlled substance ephedrine imported mainly as a liquid form from the ephedra tree in Afghanistan. The active ingredient for methaqualone (mandrax) is methaqualone itself. Ephedrine is imported illegally or smuggled because it is controlled and cannot be lawfully purchased without legitimate reasons such as medicine manufacturing. Smuggling occurs via misrepresentation on import documents or illegal importation.

“when it comes to methamphetamine, the controlled substance used there is ephedrine. You get plant-based ephedrine from the ephedra tree in Afghanistan and then you get the chemicals. Obviously, that is man-made or laboratory-made and that is the ephedrine as a liquid in a liquid form. And then the active ingredient of methaqualone, of mandrax, is methaqualone. ... So it means that the only way to get it into the country is by means of either misrepresentations on the import documents or smuggling activities into South Africa.”

Extractor fans and burners are industrially used components in various industries including mining; however, specific reaction vessels needed for illegal drug manufacturing are not readily available legally and need to be imported illegally or manufactured locally with misrepresentations.

“the extractor fans are industrially used in a number of industries... the reaction vessels because it needs to be a specific vessel that is scientifically developed... So that vessels need to be either manufactured in South Africa or illegally imported with misrepresentations”

Reaction vessels used in illegal synthetic drug manufacturing are exclusively for illegal purposes, and authorities including SAPS are not aware of any manufacturers of these vessels in South Africa, but they are known to be manufactured abroad.

“from my own knowledge, these reaction vessels are exclusively used for the illegal purposes... Not in South Africa, Commissioner, but abroad indeed”

Synthetic drugs are primarily manufactured for local market consumption but may also be sold to markets beyond South Africa's borders.

“Synthetic drugs are manufactured primarily for the local market but may also be sold to markets beyond the border”

Clandestine drug laboratories of various sizes and types are detected in South Africa approximately 20 times per year.

“on an annual basis, clandestine laboratories of different size and nature are detected within South Africa approximately 20 per annum”

Sergeant Nkosi states he was mentoring Mr Molefe in bike riding since at least October 2021 and that Molfe was practicing on another bike before his own arrived in South Africa, which was around 2022 to 2023.

“You were mentoring him from 2021 and he was riding from October 2021 at least ... When I started to pay for the bikes, they were not yet in South Africa, they were still in Canada ... I think it could be there by 2022 to 2023 ... before Mr Molefe's bike arrived in South Africa, he was practicing with one of Mr Msibi.”

Sergeant Nkosi admitted he sent an email about the Nangy enquiry to Mr Motsumi, a businessman concerned about safety and security in South Africa.

“One of the reasons that I am sending some of the stuff, especially on crime, to Mr Motsumi , one is because he is a businessman and being a businessman, he also has interest on the safety and security of the inheritance of South Africa .”