SINGAPORE - Jewellery retailers and dealers of precious metals and stones, including second-hand goods dealers and auction houses, will have to register with the Ministry of Law under proposed guidelines for the industry.

All regulated dealers of precious stones and metals, like diamonds, jade, silver and gold, will have to register with the ministry under the Precious Stones and Precious Metals (Prevention of Money Laundering and Terrorism Financing) Bill tabled in Parliament on Monday (Jan 14).

Registration is expected to start in the second quarter of this year, when about 2,500 such dealers will have six months to do so once the Bill comes into effect.

Under the Bill, tabled for the first time by Senior Minister of State for Law Edwin Tong, dealers will have to conduct stricter customer due diligence checks when handling transactions, as part of efforts to boost Singapore's standards of anti-money laundering and countering the finance of terrorism.

This includes performing risk assessments posed by customers and transactions and also having internal procedures to mitigate these risks.

This will combat crime and improve security both domestically and globally, said the ministry in a statement.

The portability of precious stones and metals and the ease of converting their high value into cash expose the sector to the risk of money laundering and terrorism financing, it added.

The proposed changes will also cover goods, such as watches or luxury items, where more than 50 per cent of the finished product's value comes from the precious stones or metal.

This is the first time that specific rules have been proposed to regulate the industry against the threat of money laundering and terrorism financing. However, existing measures under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act require dealers to submit cash transaction reports (CTRs) for deals that exceed $20,000 and suspicious transaction reports (STRs).

There have been more STRs in the last few years, according to figures from the Commercial Affairs Department, from industries such as banks, money changers and insurance companies.

The white-collar crime unit received 35,471 reports of suspicious transactions in 2017, a 22 per cent increase from 2014, when there were 29,082 reports.

There were also more CTRs submitted in 2017, when there were 380,553 reports, a 3 per cent increase from 367,689 in the previous year.

Dealers of precious stones and metals have had to submit CTRs since late 2014.