The role of auditors: Research into organised crime and money laundering

This research paper by the Institute for Security Studies explores whether auditors in the Southern African Development Community (SADC) region can provide unique insights into money laundering and the extent to which they can assist in combating it. Based on surveys and interviews with professionals from four multinational auditing firms, the paper concludes that while general auditors are poorly positioned to detect money laundering, forensic auditors may offer valuable qualitative data. It further identifies significant gaps in auditors' understanding of anti-money laundering regulations and highlights systemic challenges in the SADC region that hinder the effectiveness of legal measures.

• General auditors are largely unable to detect money laundering because it typically falls outside the scope of a standard audit and the transactions are often too complex or layered to be spotted through sampling.
• Forensic auditors possess a more specialized investigative capacity and are more likely to suspect money laundering; one in three forensic auditors in the sample suspected at least four instances per year.
• There is significant confusion and a lack of consistent knowledge among auditors regarding the specific laws and reporting obligations related to money laundering, particularly in South Africa.
• Auditors are often reluctant to report suspected money laundering due to fears of being sued by clients, the existence of confidentiality agreements, and a lack of confidence in the ability of law enforcement to successfully prosecute cases.
• The effectiveness of anti-money laundering measures in the SADC region is undermined by six primary factors: the prevalence of cash-driven informal economies, the complexity of electronic international transactions, official corruption, a poor business culture, the desire to maintain banking confidentiality for competitiveness, and a weak criminal justice system.
• Auditing firms can play a positive role in combating money laundering by assisting law enforcement with complex financial investigations and by educating clients on how to avoid inadvertently accepting proceeds of crime.
• South Africa established the Financial Intelligence Centre (FIC) in February 2002 to collect and analyze information on money laundering and advise investigative authorities such as the SAPS and the Asset Forfeiture Unit.

APA

Standing, A., & van Vuuren, H. (2003). The role of auditors: Research into organised crime and money laundering. Institute for Security Studies. https://issafrica.s3.amazonaws.com/site/uploads/73.PDF

Chicago

Standing, André, and Hennie van Vuuren. The role of auditors: Research into organised crime and money laundering. Institute for Security Studies, 2003. https://issafrica.s3.amazonaws.com/site/uploads/73.PDF.

Wikipedia

{{cite report |last1=Standing |first1=André |last2=van Vuuren |first2=Hennie |title=The role of auditors: Research into organised crime and money laundering |publisher=Institute for Security Studies |date=May 2003 |url=https://issafrica.s3.amazonaws.com/site/uploads/73.PDF |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{standing2003role, author = {Standing, André and van Vuuren, Hennie}, title = {{The role of auditors: Research into organised crime and money laundering}}, institution = {Institute for Security Studies}, year = {2003}, month = may, url = {https://issafrica.s3.amazonaws.com/site/uploads/73.PDF}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }