Singapore Says Banking Sector Is Top Money Laundering Risk

Singapore has identified banks as the entities posing the greatest money laundering (ML) risk to the country.

The Monetary Authority of Singapore (MAS), which is a government agency, said this in a Money Laundering National Risk Assessment released Thursday (June 20).

“The role of banks in facilitating transactions in the financial system, and their wide networks through which cross-border transactions can be conducted, make banks a common channel which criminals exploit,” the report said.

“In addition, banks are exposed to a larger proportion of customers with higher ML risks (including those from higher ML risk jurisdictions), high volume of cross-border transactions, and a range of complex products and structure,” the report added.

While the banking sector tops the list, other higher money laundering risk sectors include corporate service providers, real estate, casinos, licensed trust companies, precious stones and precious metal dealers, digital payment token services providers, payment institutions and external asset managers, according to the report.

As far as key money laundering threats, the report highlighted fraud (especially cyber-enabled fraud), organized crime, corruption, tax crimes and trade-based money laundering.

Beyond those, other notable money laundering threats include environmental crime, cybercrime and drug-related offenses, per the report.

“As an international business, financial and trading centre, Singapore is exposed to external threats arising from predicate offenses that have a foreign nexus,” the report said.

To prevent, detect and combat money laundering, the country works closely with both international and domestic stakeholders, aiming to ensure that its anti-money laundering (AML) measures keep pace with the evolving threats, the report said.

In addition to enhancing its regulatory framework, Singapore will continue to develop close partnerships between the public and private sectors, according to the report.

“The process of risks assessment is a dynamic one, and Singapore will continue to monitor and sense-make risks on an ongoing basis to ensure that our risks understanding, and risks mitigation measures remain up to date and effective,” the report said.

Authorities in the United States are also focusing on money laundering, with the U.S. Department of the Treasury saying in May that one of its priorities for 2024 is closing legal and regulatory gaps in the country’s anti-money laundering and combating the financing of terrorism (AML/CFT) framework.