Wednesday, May 13, 2015

Boost for MAS against Money Laundering and Terrorism Financing

Proposed changes to the Monetary Authority of Singapore ('MAS') Act have been announced in order to shore up the city-state's defence against money laundering and terrorism financing.

Money laundering cases are emerging on a global scale and Singapore, being a reputable financial hub, has recently been listed as a jurisdiction of primary concern on the U.S. Money Laundering List.

The proposed changes to the MAS Act will align Singapore's anti-money laundering and countering the financing of terrorism ('AML/CFT') regime more closely with the international standards set by the Financial Action Task Force ('FATF') and the Core Principles for Effective Banking Supervision by the Basel Committee on Banking Supervision.

Under the new provisions, the MAS will be able to share information related to AML/CFT with foreign supervisory authorities. The MAS will also be able to share information with Singapore authorities for the purposes of AML/CFT supervisory actions, investigation or enforcement.

The proposed amendments will set out the requirements for financial institutions ('FI') to conduct customer due diligence ('CDD') and retain such records. Currently, the requirements are imposed on FIs in Singapore through the AML/CFT notices.

In addition, MAS will be vested with the power to conduct AML/CFT inspections on FIs and to approve such inspections by home AML/CFT supervisors. The MAS will also be allowed to appoint a third party to inspect an FI on MAS' behalf.

Further enhancements to the Act include the provision for the MAS to inspect a wider range of FIs, such as holders of stored valued facilities and non-bank credit card or charge card issuers.

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