President finally buckles on Fica bill

Zuma’s promulgation of act seen as a boost for Ramaphosa

PRESIDENT Jacob Zuma buckled under pressure when he finally signed into law the contentious “terrorism bill” – and some of his supporters who said the law would hurt ANC donors are irked by the move.

In what could be interpreted as a major boost for Deputy President Cyril Ramaphosa’s campaign to become president, Zuma yesterday relented under mounting pressure and promulgated the Financial Intelligence Centre Amendment Act. The law was aimed at combating money laundering and the financing of terrorism.

Zuma had raised concerns about certain parts of the bill and send it back to Parliament. The influential Black Business Council (BBC), whose members include some businessmen close to Zuma, had initially rejected the bill.

The Progressive Professionals Forum and Black First Land First – whose leaders are known supporters of Zuma’s friends, the Guptas – are not happy with the president.

Last month, Ramaphosa distanced the ruling ANC from remarks by (PPF) president Mzwanele Manyi that if promulgated, the legislation would “bankrupt” the ANC.

Manyi had also threatened that they would take Zuma to court if he approved the legislation.

But the Council for the Advancement of the South African Constitution (Casac) wrote to Zuma requesting he sign the bill into law in September last year. In November, it was sent back to Parliament after the president raised concern about a clause on warrantless searches.

Following amendments, it was then passed by the National Assembly on February 28, paving the way for Zuma to sign it into law.

Yesterday, Casac executive secretary Lawson Naidoo said the council wrote to the president on April 19, urging him to promulgate the bill or refer it to the Constitutional Court if he was unhappy about it. They gave him until Friday.

“If we had not passed the bill now, the Financial Action Task Force (FATF) would have issued a public statement censuring South Africa, and the impact would have been on the banks. The global banks would have said, ‘we are not going to do business with you because we don’t know how robust your systems are’,” said Naidoo.

The BBC, which was initially against the legislation, saying it placed too much power on banks and raised the constitutionality of the warrantless searches, welcomed the law after amendments.

BBC chairperson Sello Rasethaba urged the Treasury and law enforcement agencies to apply the law without fear or favour.

“South Africans must be assured that this law is not used to further the political goals of certain individuals and that the law is not used to exclude others from the financial system.

“The Fica law must not be used to discriminate instead of ensuring that FATF recommendations are implemented in a transparent and democratic manner,” said Rasethaba. He said he was notified during the week of the president’s intentions to sign the bill.

“The president was under pressure from Casac, as they had written to him that he should sign it into law within 10 days or else they will take him to the Concourt,” he said.

Rasethaba added the law would help expose corrupt government officials, criminals and commercial tax evaders, among others.

The Banking Association of SA (Basa) said it was relieved that Zuma had finally signed the Bill into law.

Basa managing director Cas Coovadia said despite delays in signing the bill, they were happy it finally happened.

“It means now that the banks in our country are up to date with international standards compliance.

“It means we don’t get on the wrong side of the international financial institutions,” said Coovadia.

South Africa had missed the February deadline set by the (FATF).

Black First Land First leader Andile Mngxitama dismissed the legislation as a “hostile act” which was a “mistake”.

His organisation would support anyone who challenged it in court “on the grounds that it gives undue power to the banks”.

“Our call to the president is that there should be a judicial commission into banks as soon as possible. This Act is a mistake. It shows that Zuma has caved to the pressure that was placed on him by white monopoly capital and the media.”

Zuma’s spokesperson Dr Bongani Ngqulunga said the president was satisfied that the Act addressed constitutional concerns he had raised about warrantless searches. The amendments strengthened the transparency and integrity of the country’s financial system, he said.

“The amendments also make it harder for persons who are involved in illegitimate activities or tax evasion to hide behind legal entities like shell companies and trusts.”

Ngqulunga said the Amendment Act further demonstrated the country’s membership commitments to the FATF and UN.

Yunus Carrim, chairperson of Parliament’s standing committee on finance, said they welcomed the Act as the country had lost more than R600 billion in illicit financial flows over the past 10 years.

“It is big businesses, not emerging black businesses, that are primarily responsible for this. It is the poor and disadvantaged who ultimately bear a disproportional burden for this,” he said.

Carrim said the legislation did not give the banks any more power than they currently had, and that it would ultimately serve the “needs of the poor and disadvantaged the most, and is part of our country’s radical economic transformation agenda”.

Manyi did not respond when approached for comment.

PPF national chairperson Thembakazi Mnyaka said she was “too busy” to comment.

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