Abstract
Corporate legal entities and structures, that are designed for the progression of commerce, have been identified as one of the structures that are misused by natural persons for corruption, fraud, money laundering as well as other criminal and/or illegal activities. The misuse of corporate legal entities is prominent in infrastructure projects and infrastructure projects are considered high risk sectors for criminal and/or illegal activities. The South African government has also raised concerns about corruption and fraud in infrastructure projects.
After years of research, the Financial Action Task Force has found that the misuse of corporate legal entities can be significantly reduced if information about the beneficial owner, along with the dealings of the corporate legal entities, are readily available to authorities.
This dissertation examines beneficial ownership disclosure and reporting requirements in terms of the Companies Act and assesses whether beneficial ownership disclosure and reporting can be used as one of the remedies to curb the misuse of corporate legal entities. For this purpose, this dissertation relies on data from case law, journal articles, and legislation to illustrate how corporate legal entities are misused for criminal and illegal activities in infrastructure projects, as well as how beneficial ownership disclosure and reporting can assist in curbing the misuse of corporate legal structures.
This dissertation also provides recommendations on how the South African government can better implement beneficial ownership disclosure and reporting to deter the misuse of corporate legal entities.