MAS speeds up probe of financial crimes, gives updates on Hyflux and ongoing key cases in report

MAS will continue to engage the financial industry in efforts to identify offences early by using data analytics. PHOTO: ST FILE

SINGAPORE - Perpetrators of financial crimes in Singapore can expect swift punishment, a report issued on Wednesday (April 27) by the Republic's central bank revealed.

The average time taken by the Monetary Authority of Singapore (MAS) to complete reviews and investigations into breaches of financial industry laws and regulations decreased from 24 months to just nine in criminal cases, and from 26 months to 19 in civil penalty cases.

Its Enforcement Report 2020-2021 notes that speedy conclusion of the probes helped secure seven criminal convictions, which included three jail sentences and four fines, in the 18 months to Dec 31, 2021.

The report shows 20 prohibition orders were issued, banning unfit representatives from re-entering the financial industry.

The licence of a fund management company - Apical Asset Management - was revoked in the same period.

The MAS imposed $2.4 million in composition penalties for money laundering and terror financing control breaches, and $150,000 in civil penalties against offenders.

Ms Peggy Pao-Keerthi Pei Yu, executive director of its enforcement department, said the central bank does not gauge enforcement effectiveness by timelines alone, as the time taken to complete cases can vary depending on several factors.

"Nevertheless, the trend of reduction in time taken to complete our criminal and civil penalty investigations over the years attests to our commitment to administer swift enforcement outcomes," she added.

She said MAS has proposed legislative changes to boost its effectiveness in addressing financial misconduct.

Earlier this year, MAS introduced enhanced prohibition order powers in the Financial Services and Markets Bill 2022 in Parliament and also consulted on proposals to strengthen its investigative powers under MAS-administered Acts.

The report said MAS will continue to engage the industry in efforts to identify potential mis-selling and other offences early by using data analytics.

In response to investor and industry feedback, MAS has introduced a section in the latest report that will provide updates on ongoing high-profile cases such as Hyflux and Noble Group, as well as embark on a study on investor recourse for losses due to market misconduct.

Investigations against Hyflux were initiated in June 2020 after a review by MAS and Singapore Exchange into the company's disclosure, accounting and auditing practices raised concerns about its Tuaspring Integrated Water and Power Project.

Noble Group has been under investigation since 2018 for suspected disclosure-related offences, and potential breaches of the Companies Act by its wholly owned subsidiary Noble Resources International.

Such updates, MAS said, are aimed at providing greater transparency regarding ongoing efforts to pursue complex and high-profile cases.

However, it will balance the public's interest in obtaining information against the need to protect the integrity of investigations and any pending court proceedings.

"We will continue to improve our processes to uphold Singapore's reputation as a trusted financial centre that takes a tough approach to financial crime and misconduct," said Ms Pao-Keerthi.

According to the MAS report, enforcement priorities for 2022 and 2023 will include enhancing effectiveness in pursuing breaches of corporate disclosure requirements, including through close collaboration with key regulatory and enforcement partners.

For instance, MAS and the police's Commercial Affairs Department recently launched a joint investigation with the Hong Kong Securities and Futures Commission and the Hong Kong police into a syndicate suspected of operating pump-and-dump scams on stocks listed on the Hong Kong Stock Exchange.

The simultaneous joint operation was the first of its kind in tackling cross-border pump-and-dump scams.

Pump-and-dump is a manipulative scheme to boost the price of a security through fake recommendations based on false, misleading, or exaggerated statements.

"We will continue to collaborate closely with our enforcement partners, to uphold Singapore's reputation as a trusted financial centre," said Ms Pao-Keerthi.

MAS will also step up focus on corporate finance advisory firms and fund management companies that fail to comply with business conduct requirements.

The regulator will seek options for enhancing investors' recourse for losses due to securities market misconduct and strengthen focus on holding senior managers accountable for breaches by their companies or subordinates.

Follow ST on LinkedIn and stay updated on the latest career news, insights and more.