Singapore has announced findings of its updated ML NRA, which reflects its commitment to fortifying its AML framework in response to global risks.
The comprehensive review, overseen by Singapore’s Financial Intelligence Unit – the Suspicious Transaction Reporting Office (STRO) – collates insights from various supervisory bodies, law enforcement, and feedback from international counterparts and private sector entities.
Since the previous assessment in 2014, Singapore has continuously monitored ML risks, with special attention on the misuse of legal entities, the rise of virtual assets, and the laundering of proceeds from environmental crimes. These efforts ensure emerging threats are identified promptly, allowing for the implementation of targeted strategies to mitigate risks effectively across all stakeholders.
The report identifies Singapore’s major ML threats as primarily stemming from both foreign and domestic cyber-enabled fraud, often orchestrated by criminal syndicates based abroad. Other significant threats include corruption, organised crime, tax crimes, and trade-based money laundering. Common methods of laundering illicit funds include the use of bank accounts, exploitation of shell companies, and the acquisition of high-value assets such as real estate and precious metals.
The banking sector, notably including wealth management services, is highlighted as having the highest exposure to ML risks due to its role in handling substantial transaction volumes and serving clients from high-risk jurisdictions. The report also notes particular vulnerabilities within the Designated Non-Financial Businesses and Professions (DNFBPs), with corporate service providers and sectors involving real estate, casinos, and precious stones and metals facing significant risks.
Amidst increased adoption of technology facilitating rapid and large cross-border transactions, the risk posed by digital payment token (DPT) services and virtual asset service providers is under close scrutiny. This sector, although relatively small in global terms, has seen a rise in ML incidents, prompting enhanced monitoring and regulatory measures.
The findings from the updated ML NRA are set to guide ongoing efforts to refine Singapore’s AML regime, focusing on risk-targeted initiatives to raise awareness among Financial Institutions (FIs) and DNFBPs about emerging threats. This will enable more timely detection, disruption, and enforcement actions against illicit activities, ensuring that Singapore’s financial systems remain robust and secure against such vulnerabilities.
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