Wednesday, April 1, 2015

Singapore Listed as a "Jurisdiction of Primary Concern” on U.S. Money Laundering List

Singapore has been designated as a “Jurisdiction of Primary Concern” on the U.S. Major Money Laundering List according to the International Narcotics Control Strategy Report released in March 2015.

The U.S. defines a major money laundering country as one whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking. The growth of Singapore's private banking and asset management industry coupled with the limited large currency reporting requirements is considered to make it a potentially attractive money laundering destination for transnational criminals and corrupt foreign officials. Furthermore, Singapore is a major transshipment port which hosts a myriad of free trade zones (‘FTZs’), leaving it vulnerable to trade-based money laundering and trade fraud.

Australia has also been named in the list as a “Jurisdiction of Primary Concern” because of its links with terrorism financing. According to the report, terrorism financing in Australia ranges from organised fundraising by domestic terrorist cells which are part of a larger international network to funds raised by small, loosely-organised groups.

Economies that attract funds globally are susceptible to money laundering activity due to the financial options available which may encourage criminals to believe that they may more easily hide their funds. Even though such countries may have aggressive anti-money laundering (‘AML’) laws and enforcement, they may still be classified as a “Jurisdiction of Primary Concern”. Countries categorized as “Jurisdictions of Concern” generally do not have an acute money laundering problem whereas countries under the “Other Jurisdictions Monitored” category do not pose immediate concerns.

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