South Africa 2021


South Africa presents somewhat of a paradox in its fight against corruption. It is characterized by a robust institutional, legal, and policy-based anti-corruption framework. However, the country’s reputation as one of Africa’s economic hubs has been tarnished by persistent levels of corruption, on both a grand and administrative scale. Corruption in South Africa has grown to dominate the public procurement process and state-business relations to the extent that it is argued to have potentially reached the level of state capture in which those in power use corruption to influence the country’s policies, legal environment, and economy to benefit their own interests.

In 2020, South Africa received a score of 44 out of 100 on Transparency International’s Corruption Perceptions Index (CPI).1 South Africa has maintained a consistently high level of percieved corruption: since 2010 South Africa has not received a CPI score higher than 45.2 Other measures of corruption indicate a worsening trend over time.

Despite the country’s levels of petty corruption being one of the lowest in Sub-Saharan Africa, Transparency International’s 2019 Global Corruption Barometer shows that bribery rates in the country increased by approximately 11% between 2015 and 2019.3

South Africa fairs relatively well on the 2020 Basel Anti-Money Laundering Index, ranking 87th out of 141 countries.4 However, the South African Revenue Service (SARS) warns that the country is at very high risk of illicit financial flows. SARS reports an increase in the use of cross-border structuring and transfer pricing manipulations by businesses to illegally reduce their local tax liabilities, and that some of the largest companies listed on the Johannesburg Stock Exchange have been implicated in tax avoidance matters relating to other countries.5

Civil society in South Africa is very active and is able to operate freely. Civil society organisations (CSOs) play a crucial role in monitoring that the activities of the private and public sphere are not being carried out for a private gain at the expense of the citizens. CSOs often harnesses public pressure to hold the powerful to the account via demonstrations, campaigns, advocacy and also litigation.

After recent revelations of close connections between high-level politicians and a small group of businessmen, resulting in favourable contracts for the latter, grand corruption in the country is finally being investigated. The ongoing inquiry into allegations of state capture, corruption and fraud in the public sector, including organs of the state, demonstrates the extent to which corruption is deeply ingrained in the country’s political apparatus, where the lines between public and private interests have become increasingly blurred.

Asset recovery in South Africa

Several institutions play a role in South Africa’s anti-corruption and asset recovery framework. Oversight agencies such as the Public Protector and National Prosecuting Authority (NPA) are enshrined in the Constitution of South Africa, while anti-corruption units such as the Special Investigation Unit (SIU) and the Financial Intelligence Centre were established by Acts of Parliament. The Asset Forfeiture Unit (AFU) and Investigating Directorate (ID), both located within the NPA, are central to the country’s asset recovery efforts by seizing assets that are proceeds of crime.6 Another important structure is the Anti-Corruption Task Team (ACTT), which was established in 2010 as an interdepartmental body mandated to fast-track high priority and high-profile corruption cases.

Two key pieces of legislation are dedicated to asset recovery in South Africa: The Prevention of Organised Crime Act (POCA), 1998, and the International Co-operation in Criminal Matters Act (ICCMA), 1996. The POCA provides that property obtained by means of criminal activities may be forfeited to the State. It was introduced as a measure to combat, amongst others, organised crime, money laundering and criminal activities. The Act also provides for the establishment of a Criminal Assets Recovery Account (CARA).7 The AFU was established to ensure the implementation of the POCA. The mandate of the Unit is to expunge undue profits obtained from criminal activities by utilising both conviction and non-conviction-based confiscation and forfeiture proceedings.8

Money and property confiscated following a court order are deposited into the CARA which then funds projects (e.g. R150 million allocated to establish the Anti-Corruption Task Team; R20 million allocated towards funding civil society organisations rendering assistance to victims of crime) or directly compensates victims of economic crime. The distribution of monies and assets in the CARA are made by the Cabinet, following recommendations of the Criminal Assets Recovery Committee and in line with the disbursement model as governed by the Grant Management Policy. However, allocations are not done annually, and funds are only distributed when made available.9

Asset recovery reform

According to the Department of Justice and Constitutional Development 2019/2020 Annual Report, over the past few years, the AFU has obtained freezing orders to the value of R1.6 billion (approximately USD 112.5 million) relating to corruption where the amount involved is more than R5 million (approximately USD 351,500). From this amount, R190 million (approximately USD 13,4 million) was eventually recovered under the terms of the POCA.10 Three measures have contributed to the success of the AFU. Firstly, the Unit has sought to strengthen its cooperation with its law enforcement partners. Secondly, limited resources have been focused on high value and complex cases that have a greater impact, and thirdly, the AFU has made use of Chapter 6 of the POCA, which provides forfeiture independently of the criminal process.11 In practice, the AFU frequently confiscates the proceeds of crime and either returns the ill-gotten gains back to the victims or forfeits such proceeds to the state.12

Progress in asset recovery

South Africa is regarded as both a source and a destination country of proceeds of grand corruption. Some of the proceeds have been invested in residential properties in plush suburbs in Johannesburg and Cape Town, for example, by serving government ministers from the Democratic Republic of Congo, and former and current military officials from Angola.13 The country cooperates with other states and the ICCMA governs the provision of mutual legal assistance from South Africa, including confiscation and transfer of proceeds of crime.14

The National Anti-Corruption Strategy (NACS) (2020-2030) which was developed by the government in collaboration with civil society and other partners establishes the country’s strategic anti-corruption framework and provides one of the strategic thrusts for the involvement of civil society in fighting corruption.

In 2018, the Civil Society Working Group on State Capture, a coalition of more than 20 CSOs was established. The coalition has been actively engaged in making joint submissions to the Judicial Commission of Inquiry into Allegations of State Capture (Zondo Commission) in order to assist the Commission in its fact-finding mission and to ensure accountability for economic crimes committed by both members of the political elite and private businesses linked to state capture. In 2020, the CSOs involved put forward a number of recommendations to address the past as well prevent the future capture of state-owned entities and public asset theft, including the idea that the Commission must insist on the creation of a public fund that can be used to cover the costs of the legal pursuit of funds siphoned off as a result of state capture.15

One of the most important moments for investigative journalists in South Africa was the exposure of the role of the Gupta family in collaboration with the former president Zuma, in the systemic state capture under the influence of their extended network. The investigation known as the “Gupta Leaks” series is said to have constituted a critical turning point in the fight against cronyism in South Africa and led to the former president Zuma stepping down. Furthermore, it strongly contributed to the establishment of the Zondo Commission.16

Domestic recovery

The biggest and the most recent series of corruption cases in South Africa relate to observations made by the former Public Protector, Thuli Madonsela, into allegations of state capture. The Zondo Commission, investigating allegations that former President Zuma allowed members of the Gupta family to have a direct influence in shaping the policies of the South African government, highlights concerns relating to possible abuse of office, conflict of interest and ethical breaches by the President and his son, certain Members of Parliament, senior government officials, executive staff members of SOEs, and the Gupta family.17

On 4 June 2021, local media reported that the Investigating Directorate, which is mandated to specifically focus on state-capture related corruption, had seized assets worth more than USD 38 million from the Gupta family and their business associates. The seized assets include luxury properties in several upmarket areas. The Gupta family fled from South Africa to Dubai and India in 2018, consequently leading to the Investigating Directorate issuing a warrant for their arrest through Interpol.18

The application of the non-conviction-based asset forfeiture element of the POCA has enabled the National Prosecution Authority to initiate asset forfeiture proceedings against the Gupta family and their business associates. The value of the assets in South Africa is estimated at R520 million (approximately USD 38 million) and some of these include:19

  • Iqbal Sharma and his wife’s Sandton house worth USD 836,084 and moveable property worth USD 34,836 (including artefacts imported from India) and an apartment worth USD 90,575 in Sandton, Johannesburg
  • A house worth USD 1,463,148 million in the suburb of Constantia in Cape Town and another house worth USD 836,084 in Saxonworld, Johannesburg
  • Islandsite Investments One Hundred and Eighty, an asset-rich company of the Guptas

According to the POCA, the Guptas and their business associates would forfeit the assets to the state should they be found guilty. In the Estina dairy farm scandal – one alleged corruption scheme linked to also to a network of Gupta associates, in which contracts where given to suspicious companies and are suspected of never reaching the intended beneficiaries – the government has already granted an order to freeze the assets of several suspected individuals.20

Although the South African government has successfully confiscated assets believed to be linked to proceeds of crime within the country, questions have been raised on why similar efforts have not been carried out to recover assets and money that were allegedly laundered out of South Africa by the Guptas and their associates to other countries.21 South Africa and the United Arab Emirates (UAE) recently finalised an extradition and mutual legal assistance treaty that officially came into effect in July 2021. A portion of the funds misappropriated by the Guptas is said to have ended up in the UAE, where several of their companies are incorporated.22

International Recovery

South African authorities recently collaborated successfully with Israeli law enforcement to recover assets in a case of private sector corruption. Ronald and Darren Bobroff had been said to enter into multiple agreements with their clients, which were used by the attorneys to commit fraud, theft and tax evasion. Transactions conducted on the Bobroffs bank accounts in Israel raised suspicions of money laundering and therefore the Israeli authorities froze the money and reached out for assistance to the Department of Justice in South Africa. Following an investigation, the prosecuting authorities in South Africa claimed that the money in these accounts represented the proceeds of unlawful activities in South Africa, in particular theft, fraud, money laundering and transgressions of South African tax laws. Here, the investigations conducted by the National Director of Public Prosecutions (NDPP) found that the money was the proceeds of unlawful activities, which was stolen from their clients and laundered into Israel. Most of the assets found in Israel where therefore forfeited to the State.23

South Africa played a role in assisting the Nigerian government in its asset recovery efforts against a former state governor (Mr. Diepreye Alamieyeseigha) by instituting non-conviction-based confiscation proceedings. The AFU confiscated the governor’s luxury penthouse in Cape Town and sold the property in January 2007, with the proceeds of the sale being returned to the Nigerian government.24

International Institutional Engagement

South Africa is a member of the Asset Recovery Inter-Agency Network for Southern Africa (ARINSA), the East and Southern African Anti-Money Laundering Group (ESAAMLG), and the Financial Action Task Force (FATF). The country is also an observer of the Camden Asset Recovery Interagency Network (CARIN). As a member of the ESSAMLG and FATF, South Africa is required to comply with a set of international standards on combating money laundering and the financing of terrorism. The 2018 Mutual Evaluations Post-Evaluation Progress Report of South Africa, indicated that the country was generally compliant with the FATF Recommendations, but minor deficiencies in seven of the recommendations required attention. In response, South African authorities stated that they are in the process of widening the scope of financial institutions in order to address the deficiencies.25

South Africa also sits on the G20 Anti-Corruption Working Group (ACWG) by virtue of its status as a G20 country. The Group was established in 2010 and its thematic focus areas include issues related to private sector integrity and transparency, bribery, international cooperation, asset recovery, beneficial ownership transparency, vulnerable sectors and capacity building. Speaking at the first ever G20 Anti-Corruption Ministerial meeting in 2020, the South African Minister of Public Service and Administration expressed concerns about the lack of coordination and collaboration between G20 member states. He noted that: “It is sad that on all international platforms we recommit to co-operating with each other, yet on the ground, there is little progress in this regard. We urge fellow G20 countries to lead by example in affording one another wider measures of co-operation in the recovery of assets and law enforcement.”26

The South African government endorsed the Open Government Partnership (OGP) Declaration of Principles in September 2011, thereby committing itself to work with civil society towards enhancing transparency, public participation, accountability, and the fight against corruption in both public and private spheres.


South Africa does not lack the legislative, policy and institutional armour required to address the corruption challenges the country faces. Rather, it is a question of whether or not the country is using its anti-corruption tools sufficiently. While the country has made progress in establishing a comprehensive anti-corruption framework, challenges in the criminal justice field remain – political interference, and poor coordination and collaboration between anti-corruption agencies has not only tarnished levels of public trust in these institutions but has also affected their performance in effectively combating corruption.

The slow disposal rate of Asset Recovery cases is believed to lead to high management costs for recovered assets, potentially resulting in a loss of value. For example, some of the confiscated properties include houses and businesses (e.g., hotels) which may have high operating costs and may be difficult to maintain after they have been seized. Other property management challenges relate to costs incurred through the appointment of curators to look after the frozen properties. Furthermore, asset recovery processes require adequate technical expertise, but a lack of forensic skills and knowledge is identified as one of the key barriers facing asset recovery agencies in South Africa. These insufficient levels of skill contribute to unsuccessful confiscation proceedings, resulting in costs to the country.27 In addition, a shortage of staff was identified as the number one factor undermining the effectiveness of the NPA, followed by inadequate budgets and poor collaboration.28

Political interference, and poor coordination and collaboration in the South African criminal justice system over the last few years have not only hindered the effectiveness of anti-corruption agencies, but these factors are also understood to have weakened and undermined institutions tasked with upholding the rule of law. Senior officials in the criminal justice system have been implicated in the State Capture Commission of Inquiry, bringing about a loss of trust in the system as a whole.29 Even though the AFU is a critical component of South Africa’s anti-corruption and asset recovery framework, the performance of the Unit has come under scrutiny, leading to the NPA’s plans to amend the POCA in order to boost asset recovery and strengthen the activities of the AFU.30

The ACTT has also been scrutinised by the Directorate of Priority Crime Investigation (DPCI) and SIU for being ineffective in investigating and prosecuting serious cases of corruption.31 In 2014, despite the limited resources of already constrained agencies, the Task Team’s scope was broadened to focus on strategic and preventative activities, shifting from the core law-enforcement mandate.32 The success of the ACTT relies on the collaborative efforts of its members, but a coordination framework is yet to be established, particularly in light of the need for it to strengthen investigations, prosecutions and asset recovery mechanisms in prioritised cases. An update to the Standing Committee on Public Accounts (SCOPA) by the ACTT in November 2020 revealed that since the Task Team’s inception in 2010, there had been two cases of asset forfeiture totalling USD 575,898, which were forwarded to the CARA.


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