Wednesday, October 31, 2012

Tax Crimes as Money Laundering Predicate Offences in Singapore

Following through on the updated FATF Recommendations, MAS has issued a consultation paper on the new designation of tax crimes as money laundering predicate offences. Willful and fraudulent tax evasion are to be designated serious tax crimes and become predicate offences to money laundering in Singapore.
By 1 July 2013, all financial institutions in Singapore must enhance their money laundering prevention measures accordingly. Most markedly, they must identify tax-specific risk indicators (‘red-flag indicators’) and introduce them in their existing AML framework. Where necessary, additional information must be obtained to verify the tax status. In addition to applying these measures starting 1 July 2013, the financial intermediaries must undertake a critical review of their existing client relationships.

MAS encourages finanical institutions to consider the framework the Private Banking Industry Group is developing as a reference when evaluating the suitability of their practices. The objective is to establish a framework fitting your specific business and its specific risks. The challenge is on.

Commodities Risk Management Training

Our latest training course - Commodities Risk Management - is proving popular with financial institutions in Singapore.

Contact us to book in-house training for this or other topics.

UBS to Exit Fixed Income

The only thing more surprising that the announcement of Star Wars Episode VII this week was UBS's decision to exit fixed income trading, citing new capital adequacy regulations making the business unviable: via @reuters

Quiz Time: Strategy Among Thieves

5 thieves of different ages have a collection of 100 coins.

Between them they decide to split the coins using this scheme:

  • The oldest thief proposes how to share the coins.
  • ALL thieves (including the oldest) vote either for or against it.
  • If 50% or more of the thieves vote for it, then the coins will be shared that way.
  • Otherwise, the thief proposing the scheme will be killed, and the process is repeated with the thieves that remain.

As thieves tend to be cunning, if a thief would get the same number of coins if he voted for or against a proposal, he will vote against so that the thief who proposed the plan will be killed.

Assuming that all 5 thieves are intelligent, rational, greedy, and do not wish to die (and are rather good at math for thieves), what will happen?