Money Laundering in Singapore: Understanding the Risks and Consequences

money laundering in singapore

Money laundering is a serious crime that threatens the integrity of the global financial system. It involves the concealment of illicit funds through a series of complex transactions, making it difficult for law enforcement authorities to track and seize the proceeds of criminal activity. In Singapore, the government has implemented a range of measures to combat money laundering and terrorist financing, including the passing of the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act and the implementation of robust Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations. However, despite these efforts, the risk of money laundering in Singapore remains a significant concern.

What is money laundering?

Money laundering is the act of disguising the proceeds of criminal activity by making them appear to have come from a legitimate source. It is a serious crime that can have devastating consequences for individuals and entire economies. The act of money laundering often involves three steps: placement, layering, and integration.

Placement involves placing the illicit funds into the financial system, layering involves concealing the source of the funds through a series of transactions or transfers, and integration involves making the funds appear to be legitimate by using them to purchase assets or investments.

Money laundering in Singapore

Money laundering is a serious crime in Singapore, and the government has taken several measures to combat it. The Monetary Authority of Singapore (MAS) is the primary regulator responsible for combating money laundering and terrorist financing. The MAS works closely with other government agencies, such as the Commercial Affairs Department (CAD) and the police, to investigate and prosecute money laundering cases.

Singapore has also enacted strict laws to combat money laundering, including the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act, the Terrorism (Suppression of Financing) Act, and the Casino Control Act.

Money mules carrying out money laundering activities are also not spared of their criminal actions too.

Consequences of money laundering in Singapore

As an effort to break down syndicates and individuals in transnational money laundering activities, Singapore’s Parliament passed an amendment to the law on 7th July 2014, allowing the Government to deal more quickly with criminal operations and deprive offenders of their illicit gains.

The consequences of money laundering in Singapore can be severe. Individuals who are found guilty of money laundering can face imprisonment for up to 10 years, fines of up to $1 million, or both. In addition to criminal penalties, individuals may also face civil penalties, such as fines or the confiscation of assets.

Individuals who are found guilty of money laundering can face imprisonment for up to 10 years, fines of up to $1 million, or both.

Businesses that are found to have facilitated money laundering may also face severe consequences. These can include fines, revocation of licenses, or even criminal prosecution.

In addition, amendments were also made so that enforcement agencies could accept evidence, such as court judgement and statements by experts even if offences escalated from a foreign country. The amendments will smoothen the process of investigation and prosecution of foreign predicate offences.

Precious Stones and Metal Dealers Sector Added to the Act

Another change to the Act is the inclusion of precious stones and metal dealers, such that dealers are required to verify a customer’s identity and file a report with the Suspicious Transaction Reporting Office for cash sales exceeding S$ 20,000. Transaction records shall be kept for five years from the date of filing.

Furthermore, the dual criminality requirement for foreign tax evasion offences will also be removed, as long as the offence is criminalised in the foreign jurisdiction and is committed “wilfully” with the intent to evade tax.

Property and Jewellery Susceptible to Money Laundering Activities.

Few Members of Parliament (MPs) have rose their support for the amendments and raised that there was also a need to monitor the non-finance sector such as high-end property and jewellery markets, which are just as susceptible to money laundering activities. It is also questionable how virtual currency, such as Bitcoin could be monitored as well.

Amidst all these changes, the MPs are also concerned about the monetary and administrative costs of compliance.

Measures to prevent money laundering

To prevent money laundering, financial institutions in Singapore are required to implement robust anti-money laundering policies and procedures. This includes conducting customer due diligence, monitoring transactions for suspicious activity, and reporting suspicious transactions to the authorities.

In addition, the government has implemented several measures to increase transparency and combat money laundering. For example, Singapore has signed several international agreements, such as the United Nations Convention against Corruption and the Financial Action Task Force (FATF) Recommendations, which provide a framework for combating money laundering and terrorist financing.

Overall, the Singapore government is committed to combating money laundering and has implemented several measures to prevent and prosecute this serious crime.

In conclusion, money laundering is a complex and ever-evolving threat that requires a comprehensive and coordinated response from the government, financial institutions, and other stakeholders. While Singapore has made significant progress in combating money laundering and terrorist financing, the risks remain high, and continued vigilance and cooperation are necessary to maintain the integrity of the country’s financial system.

Source: Maximum jail term for money laundering raised to 10 years. Today Online, 8th July 2014.

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Sign up for our Newsletter

By signing up of our newsletter, you have agreed to receive new from us including any promotions.