South Africa faces a significant risk of returning to the Financial Action Task Force (FATF) grey list barely a year after it was removed, according to the latest quarterly assessment by business lobby group Business Leadership South Africa (BLSA).
The FATF grey list names countries under increased monitoring for weaknesses in fighting money laundering and terrorist financing. A return to the list would increase scrutiny of South African financial transactions, raise compliance costs for banks and businesses, and risk some international banks pulling back from correspondent banking relationships, the links local banks use to move money through foreign banks. That would make cross-border payments and trade finance slower and more expensive.
South Africa spent more than two years on the list before its removal, and business groups warned at the time that the listing had deterred foreign investment.
The BLSA Reform Tracker, presented at a briefing on Wednesday, found that the country’s anti-corruption reform score was unchanged at 51.2 in the July-September quarter, with no deliverables advancing in the anti-corruption area. That means anti-corruption reforms are, on average, stuck at the halfway mark, well below the overall reform score of 72.5.
“We are at risk of re-entering that grey list. There is significant risk,” said Stuart Theobald, executive chairman of research consultancy Krutham, which compiles and analyses the tracker.
Ismail Momoniat, the national treasury adviser who led the campaign that took South Africa off the grey list in October 2025, has also flagged the danger, with anti-corruption the weak point, the tracker said.
National treasury, which has led the anti-corruption efforts, did not immediately respond to a request for comment.
Mutual evaluation
South Africa is undergoing a new FATF mutual evaluation, with a peer review expected in the first quarter of 2027 and the assessment running until October that year. The evaluation will examine whether the country has sustained the increase in investigations and prosecutions of money-laundering networks that secured its removal.
BLSA said weaknesses in law enforcement – in investigating organised crime, prosecuting successfully and recovering criminal assets – could count against South Africa. The state-appointed Madlanga commission, led by retired Constitutional Court justice Mbuyiseli Madlanga, has added to concerns after uncovering leadership failings in the police and intelligence services during its inquiry into alleged corruption and interference in law enforcement.
“We cannot afford to become complacent, particularly when the weaknesses in our criminal justice institutions, investigations and prosecutions remain unresolved,” said BLSA CEO Busi Mavuso.
Despite the grey-list warning, the broader reform tracker recorded its highest score since monitoring began in March 2024, with the overall completion index rising to 72.5 from 71.3 in the previous quarter. — Colleen Goko, © 2026 Reuters
