As most of you have seen, some months ago - early in May this year - the Financial Action Task Force (FATF) published its peer evaluation report on Singapore.
We
have included a summary below but of course the key question is ‘why does this
matter to financial institutions in Singapore?'
First,
the desired economic crime landscape in Singapore is shaped by regulations, but
the actual situation is determined by all participants and players in the market.
That means all staff and stakeholders in the financial market have a role to
play, need to know what matters and be pro-active in complying with regulatory
requirements and implementing risk-mitigating measures.
From
our point of view, it all starts with training. Senior management and
compliance officers are usually aware of what is expected by MAS. But others in
the organisation, specifically client facing and operations staff, are further
away from regulatory requirements while they should know what matters.
Sanctions
regulations are quite well known throughout the industry although hard to implement.
Money laundering regulations are firmly embedded in most financial institutions.
On the other hand, a topic like proliferation financing is seen of increasing
importance by FATF and regulators but knowledge and awareness across employees
in financial institutions is still limited.
Raising
awareness and all-staff training is therefore still of utmost importance and at
i-KYC we can help financial institutions just arranging that from start to
finish. Hassle-free, customised to your organisation, flexible and fast.
So maybe that's a reason to get in touch with us.
Alright
– back to the report and the findings. As expected, the report confirms once
more that Singapore has a robust and effective framework to prevent and counter
money laundering (ML), terrorism financing (TF), and proliferation financing
(PF) but the report lists - not surprisingly to practitioners in the market - some
areas of improvement as well.
· Overall, the Singapore
rating has been moved up from “enhanced follow-up” to “regular follow-up”, while
the Singapore financial crime regime is considered competent and coordinated.
· Furthermore,
the FATF observes that Singapore is not effective in 3 out of 11 Immediate
Outcomes.
The
following areas for improvement are mentioned:
· Singapore is
only moderately effective in transparency and beneficial ownership, money
laundering investigations and prosecutions, as well as in proliferation
financing.
· Only 682 out of
11,189 reported money laundering investigations or 5.6% resulted in prosecution.
Moreover, no assets were frozen under the UN Al-Qaeda and ISIS sanctions regime
despite exposure that was found.
The
Singapore regulator has replied that the recommendations will be studied, and
additional measures will be carefully considered.
