The central bank will set up dedicated departments to combat money laundering and strengthen enforcement, as part of global efforts to clamp down on illicit financing activities. The moves will take effect on Aug 1, the Monetary Authority of Singapore (MAS) said in a statement yesterday.
The move comes soon after MAS ordered the closure of Swiss private bank BSI's operations in Singapore, in the midst of a global crackdown on alleged illicit money flows involving Malaysian state fund 1Malaysia Development Berhad.
However, MAS said the impetus for the setting up of the departments predates the recent action against BSI Bank and the investigation into other banks.
Singapore's financial sector faces the risk of being used as a conduit for money laundering and terrorist financing activities, MAS noted.
Transnational flows of money are becoming increasingly complex and require heightened supervision to combat money laundering and other illicit financing activities, MAS said.
With the volatile global geopolitical situation and Singapore's growing concerns about our territorial security, making sure that we are not being used as a conduit for terrorist funding will become increasingly important.
TSMP LAW CORP JOINT MANAGING DIRECTOR STEFANIE YUEN THIO, on MAS' latest moves to combat money laundering.
"As our financial centre grows in scale, sophistication, and connectivity, so does the risk of criminal elements abusing our financial system," said MAS managing director Ravi Menon.
MAS will form a dedicated anti- money laundering department to consolidate monitoring activity.
A dedicated supervisory team will also be set up to monitor these risks and keep track of how financial institutions manage them.
These functions used to be carried out by different departments in MAS.
In addition, the central bank will centralise its enforcement functions under a new body, which will continue to jointly investigate capital market misconduct offences with the Commercial Affairs Department.
The body will also be responsible for enforcement actions arising from regulatory breaches of banking, insurance and capital market regulations.
Mr Menon added that "MAS is resolved to ensure that Singapore remains a clean and trusted financial centre".
TSMP Law Corp joint managing director Stefanie Yuen Thio said: "This is MAS' clearest signal yet that it will be taking money laundering very seriously, which will mean a more targeted focus on investigations and, if they find evidence of infringing activity, swifter prosecutions.
"With the volatile global geopolitical situation and Singapore's growing concerns about our territorial security, making sure that we are not being used as a conduit for terrorist funding will become increasingly important."