THE TRANSACTION OR ACTIVITY MONITORING PROCESS: AN ANALYSIS OF THE CUSTOMER DUE DILIGENCE SYSTEMS OF THE UNITED KINGDOM AND SOUTH AFRICA
Keywords:antimoney laundering, regulatory approach, Customer Due Diligence, Know Your Customer, financial institutions, transaction or activity monitoring processes
South Africa has made rigorous attempts to narrow the fissure between its antimoney laundering regulatory approach and the approaches that are found internationally. A study of the FATF Recommendations and the UK Regulations evidences the aforementioned attempts. FICA is particularly considered a landmark attempt by South Africa into controlling the scourge of money laundering. For example, FICA encourages the undertaking of the internationally accepted antimoney laundering measures. These measures are referred to as the Customer Due Diligence (CDD) or Know Your Customer (KYC) principles. The performing of the
measures is expressly enunciated in FICA. However, South Africa seems to be lagging behind on issues related to the technical application or performing of the measures. Such insulation is made apparent by the omission of the express and lucid provisions that regulate the ongoing monitoring of customer transactions or activities. This omission therefore leads financial institutions (that is, banks) to broadly examine FICA in order to carry out simulated ongoing transaction or activity monitoring processes.
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