Fi­nan­cial watch­dog urges Sin­ga­pore to get tougher on money-laun­der­ing

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Sin­ga­pore must take more ag­gres­sive ac­tion against com­plex cross-bor­der money-laun­der­ing in­clud­ing pros­e­cut­ing in­di­vid­u­als and seiz­ing il­licit pro­ceeds, a global fi­nan­cial crimes watch­dog said.

The Paris-based Fi­nan­cial Ac­tion task Force (FAqF) said in a re­view the city-state has made sig­nif­i­cant im­prove­ments in its anti-money laun­der­ing and counter-ter­ror­ist fi­nanc­ing frame­work since the last as­sess­ment in 2008.

It said, how­ever, that Sin­ga­pore needs to do more, es­pe­cially in pros­e­cut­ing big­ger cases where the crime is com­mit­ted in another coun­try and the pro­ceeds are laun­dered in Sin­ga­pore, one of Asia´s top fi­nan­cial cen­tres.

“Sin­ga­pore pro­vided in­for­ma­tion that it was pur­su­ing some com­plex cases in­volv­ing transna­tional fraud and cor­rup­tion,” it said.

“How­ever, Sin­ga­pore has pros­e­cuted few for­eign pred­i­cate money-laun­der­ing cases out­side of wire trans­fer frauds in­volv­ing money mules/shell com­pa­nies and has con­fis­cated low amounts of pro­ceeds of crime.”

The term “for­eign pred­i­cate” refers to cases orig­i­nat­ing in other coun­tries, with pro­ceeds go­ing through Sin­ga­pore. Sin­ga­pore closely guards its rep­u­ta­tion for fi­nan­cial in­tegrity and has ad­mit­ted that money-laun­der­ing hurts its im­age.

This year it launched an in­ves­ti­ga­tion into bil­lions of dol­lars of il­licit fund flows re­lated to Malaysian state in­vest­ment fund 1MDB amid al­le­ga­tions some of the money passed through Sin­ga­pore´s bank­ing sys­tem.

Switzer­land and the United States are also car­ry­ing out their own probes of ac­counts and trans­fers linked to 1MDB.

Sin­ga­pore should “more ag­gres­sively tar­get the more com­plex cases ex­pected of a so­phis­ti­cated fi­nan­cial cen­tre” while it pur­sues less com­plex of­fences in­volv­ing money mules and un­li­censed money lenders, said the FAqF report, which did not specif­i­cally re­fer to 1MDB.

For its report the FAqF used data gath­ered in 2015 and did not in­clude ac­tions taken this year. “Sin­ga­pore should take steps to im­prove the ca­pa­bil­ity of its law en­force­ment agen­cies to proac­tively iden­tify and in­ves­ti­gate money-laun­der­ing, par­tic­u­larly com­plex and for­eign pred­i­cate” cases, it said.

Au­thor­i­ties should also “more proac­tively pur­sue the con­fis­ca­tion of pro­ceeds of crime and make greater use of the seizure and con­fis­ca­tion pow­ers” un­der lo­cal laws, it said.

Re­act­ing to the FAqF find­ings, a joint state­ment from the Min­istry of Home Af­fairs, Min­istry of Fi­nance and the Mone­tary Au­thor­ity of Sin­ga­pore said law en­force­ment agen­cies would strengthen their ca­pa­bil­i­ties to iden­tify and in­ves­ti­gate transna­tional money-laun­der­ing cases.

The Fi­nan­cial In­tel­li­gence Unit “will de­velop more so­phis­ti­cated data an­a­lyt­ics ca­pa­bil­i­ties as part of this ef­fort”, the state­ment said. Sin­ga­pore´s cen­tral bank in May this year kicked out Switzer­land´s BSI Bank, which has been linked to 1MDB.

In July au­thor­i­ties said they had seized nearly $180 mil­lion in as­sets through in­ves­ti­ga­tions into the 1MDB scan­dal. An ex-BSI banker and another man have been charged in a Sin­ga­pore court with var­i­ous of­fences and sev­eral oth­ers are be­ing ques­tioned in re­la­tion to the 1MDB case.

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