Monetary Authority of Singapore Annual Report 2012/2013


Enforcement of Anti-Money Laundering/Countering the Financing of Terrorism Regulations

Over the last three years, MAS conducted a total of 108 AML/CFT inspections covering banks, insurance companies, money changers, remittance agents, capital markets services licensees, licensed trust companies, licensed financial advisers and registered insurance brokers. MAS noted that most institutions had in place the necessary policies, procedures and controls, congruent to the nature, size and complexity of their activities, to combat money laundering and terrorism financing. In addition, the institutions had invested in systems and people over the years to strengthen their AML/CFT measures.

There is, however, room for improvement in several areas. The frameworks and policies for the identification and classification of high-risk accounts, and the performance of enhanced due diligence measures for such accounts need to be strengthened. MAS also noted instances where the rigour with which customer due diligence measures were performed could be strengthened, such as the screening of customer names and the determination of customers’ source of wealth. Such inadequacies in the execution of controls hindered the effective application of customer due diligence measures necessary to gain a reasonable understanding of customers, the intended nature of business relations, and expected account activity.

MAS takes a serious view of breaches of AML/CFT regulations and failure by financial institutions to institute a robust AML/CFT control framework. Sanctions are imposed on institutions for regulatory contraventions and deficiencies in AML/CFT measures. These include formal warnings, reprimands, restrictions on operations, financial penalties and revocation of licences. Over the last three years, MAS has issued a total of 47 warnings and reprimands, restricted the operations of seven institutions, and imposed financial penalties on 22 institutions. MAS has also revoked or did not renew the licences of 13 money changers / remittance agents. MAS requires the senior management of financial institutions to set the right tone and foster a strong AML/CFT control culture to prevent Singapore’s financial system from being used to harbour or as a conduit for illegitimate funds.