An Evaluation of Methods Used by South African Law-enforcement Practitioners to Trace Commingled Proceeds of Crime: Informing the FIC's Objective Under Section 3(2)(aaA) of the Financial Intelligence Centre Act

Purpose: International anti-money laundering guidance requires countries to operationalise measures against money laundering, terrorist financing and proliferation financing. Section 3(2)(aaA) of the Financial Intelligence Centre Act 38 of 2001 (FIC Act) identifies, as an objective of the Financial Intelligence Centre (FIC), the production of forensic evidence through specialised scientific methods and techniques relevant to financial transaction flows. It does not prescribe a tracing method for other law-enforcement agencies. Design/methodology/approach: This study explores the methods used by South African law-enforcement practitioners to trace or investigate the commingled proceeds of crime and their views on the potential value of a standardised tracing methodology. Fourteen practitioners from four South African agencies were interviewed. Findings: The findings indicate variation in practice, substantial reliance on the first-in, first-out method and unanimous support among the participants for developing and testing a standardised methodology. The findings do not establish which method is most effective or legally preferable. They identify considerations for developing and validating a context-sensitive methodology that may assist the FIC in pursuing its objective under section 3(2)(aaA) and that may support the investigating authorities in preservation and forfeiture work under the Prevention of Organised Crime Act 121 of 1998 (POCA). Originality/value: To the authors' knowledge, this is the first empirical study of how South African law-enforcement practitioners trace the commingled proceeds of crime. It links practitioner experience to the FIC's section 3(2)(aaA) objective and sets out steps for validating a tracing methodology.