JOHANNESBURG—The world anti-money laundering organization Financial Action Task Force (FATF) has “grey-listed” Africa’s two biggest economies, Nigeria and South Africa.
The Paris-based task force said the action was taken because both countries hadn’t done enough to prevent illicit financial flows and terrorist financing.
Financial experts warn the gray-listing could be “devastating” to Nigeria’s and South Africa’s economies, both heavily based on extractive industries such as oil and gold mining, as it would reduce foreign direct investment.
The agency monitors governments to check that they’re following basic principles of financial regulatory oversight.
South Africa’s President Cyril Ramaphosa delivers his opening remarks at the Department of International Relations and Cooperations (DIRCO) OR Tambo Building in Pretoria on March 10, 2022. (Phill Magakoe/AFP via Getty Images)
It said Nigeria and South Africa needed to show “a sustained increase in investigations and prosecutions of serious and complex money laundering”; that both had to “enhance identification, seizure and confiscation of proceeds of economic crimes”; and to show “urgency in implementing strategies to counter terrorism financing.”…