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Cape Town – National Treasury is is concerned about initiatives to fragment the current customs administration and collection system as proposed in the Border Management Agency Bill that currently serves before Parliament, said deputy director general Ismail Momoniat.
This, says Momoniat, poses a risk to the fiscus.
National Treasury was one of the stakeholders that briefed Parliament on the incidence of illicit financial flows from South Africa, and how to counter this.
Referring to concerns about whether mining rehabilitation funds are being spent, Momoniat said he had informed the South African Revenue Service of the matter. "If the money in those funds are indeed being spent, the responsibility then falls on the fiscus," he said.
"In addition, we need better coordination between our various (collection and law enforcement) agencies so that we know our regulators are awake and on the job," Momoniat said.
The South African Reserve Bank, which was also part of the delegation that briefed Parliament, said it regulates and monitors cross-border transactions through its Financial Services Surveillance Department and is further empowered to investigate illicit foreign currency transactions.
Speaking on behalf of the Surveillance Unit, divisional head of compliance and enforcement Thys Basson said it also has the power to institute action against alleged perpetrators. This includes the blocking of funds, asset forfeiture and the subsequent referral of perpetrators to law enforcement agencies.
Basson said there has been a dramatic increase in referrals from authorised dealers in foreign exchange transactions where illicit financial flows are suspected. This contributed to early detection and subsequent law enforcement actions.
There has been a change in the modus operandi by alleged perpetrators, which will require enforcement agencies to implement counter measures.
To date, the Surveillance Unit has prevented illicit financial flows of between R5bn and R8bn.
In the current financial year, seizures at airports have already amounted to R41m, and R86m worth of seizures were done in 2015/16.
In addition, 31 cases of suspected illicit financial flows were referred for criminal investigation in 2015/16.
