Sasfin Bank blow as court backs SARS in R5.3bn fight
South African Revenue Service (SARS) has welcomed a "landmark" High Court ruling in its R5.3 billion claim against Sasfin Bank
Image: Timothy Bernard / Independent Newspapers
The South African Revenue Service (SARS) has welcomed a "landmark" High Court ruling in its R5.3 billion claim against Sasfin Bank, accused of helping clients illegally move money out of the country.
The revenue service had filed the claim in December 2023, alleging that Sasfin assisted taxpayers in illegally exporting funds. Sasfin raised legal challenges earlier this year, but the court’s ruling on November 3 2025, confirmed that SARS can pursue its alternative claim under the Financial Sector Regulation Act (FSRA), allowing the matter to proceed to trial.
"The court upheld Sasfin’s exceptions in certain respects and dismissed it in respect of others. The exception was upheld primarily on the basis that the court held that the statutory framework (comprising the Banks Act, FICA, and the Exchange Control Regulations) does not give rise to a private law duty of care owed to SARS or other creditors".
"This finding turns on a point of legal interpretation rather than pleading insufficiency. As part of its claim, SARS seeks recognition of a novel common law legal duty: namely, a duty on authorised dealers not to cause SARS patrimonial harm by directly or indirectly facilitating the unlawful expatriation of undeclared taxable funds"
SARS welcomed the court’s dismissal of Sasfin’s exception regarding causation and the objection to an alternative claim.
'SARS regards this as significant progress, as the court confirmed that SARS has a statutory right of action under section 278 of the Financial Sector Regulation Act (FSRA) for losses suffered due to contraventions of financial sector laws.
"This dismissal of Sasfin Bank’s exception to SARS’s statutory claim confirms that SARS’s alternative claim under the FSRA is properly pleaded and may proceed to trial. The judgment affirms a clear statutory remedy to pursue losses arising from breaches of financial sector laws by banks and other institutions".
SARS Commissioner Edward Kieswetter said the judgment highlights the need for banks to go beyond mere compliance and actively manage the risks posed by suspicious transactions.
“I have consistently reminded financial institutions to go beyond a narrow compliance response when reporting questionable transactions to the Financial Intelligence Centre and to manage the substantive risks posed by transactions that may be considered suspicious"
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