MAS' efforts to deter financial criminals pay off

MAS revealed that from mid-2017 to the end of 2018, it had issued 223 warnings to players in the financial sector and 444 supervisory reminders.
MAS revealed that from mid-2017 to the end of 2018, it had issued 223 warnings to players in the financial sector and 444 supervisory reminders. PHOTO: ST FILE

Regulator reveals how warnings and a new tool are helping to keep markets here clean

In an effort to maintain and burnish Singapore's reputation as a financial centre, the authorities have been keeping potential white-collar criminals in line with warnings, reprimands and the occasional prosecution.

In its first enforcement report released yesterday, the Monetary Authority of Singapore (MAS) revealed that from mid-2017 to the end of last year, it had issued 223 warnings to players in the financial sector and 444 supervisory reminders.

During the same period, MAS also issued 19 prohibition orders that bar individuals from working in the financial industry, 37 reprimands and 31 advisory letters.

This calibrated action seemed to do the trick as MAS had just one criminal conviction, as the threat of getting caught kept potential criminals in check.

Releasing the first report of MAS' Enforcement Department, which was set up in 2016 to combat breaches of financial rules, its executive director Gillian Tan said that the likelihood of capture deterred potential criminals even more than penalties and jail sentences, which MAS uses to target recalcitrant offenders.

"This (perception) is a powerful tool and is a key reason why our supervisory engagement and disruption outreach efforts pay off. In some cases, we want to be able to disrupt the misconduct quickly after it happens," said Ms Tan.

The report, to be released every 18 months, is part of the authority's efforts to raise the accountability and transparency of its enforcement actions.

It delves into the range of financial misconduct in the banking and insurance sectors and capital markets here, and shows that errant players were penalised by over $17 million in the 18-month period.

This excludes the $30 million in fines slapped on banks during the probe into the 1Malaysia Development Berhad scandal, as most were levied before July 2017.

MAS' sole prosecution case last year was of Mok Piak Liang, who was jailed 16 weeks for false trading in January last year.

 
 

The department had taken an average of eight months to investigate each case, and 33 months to prosecute financial criminals - faster than the average time taken by regulatory bodies in other countries.

MAS also developed Project Apollo, an augmented intelligence tool which codifies the thinking of human investigators in determining the likelihood of misconduct in the securities market and boasts an accuracy rate of 98 per cent. It is now being used in actual cases.

The police's Commercial Affairs Department, which partners MAS under a joint arrangement, netted 20 criminal convictions in 13 cases from mid-2017 to the end of last year, a police spokesman said.

Sentences imposed on the individuals ranged from fines of between $20,000 and $600,000, to imprisonment ranging from one to five months.

SEE TOP OF THE NEWS:

Singapore's 1MDB probe not due to political influence

Rare peek into role of a financial crime investigator

A version of this article appeared in the print edition of The Straits Times on March 21, 2019, with the headline 'MAS' efforts to deter financial criminals pay off'. Print Edition | Subscribe