KUALA LUMPUR – The super wealthy doing business with Singapore’s biggest banks and financial institutions will be scrutinised after the island republic witnessed its biggest money-laundering scandal yet, which amounted to more than SG$3 billion (RM10.55 billion).
Sources told Bloomberg that the Monetary Authority of Singapore (MAS) will also dish out fines and other punitive measures after its review of financial institutions that were heavily used by a group of Chinese nationals to launder proceeds from online gambling.
A MAS spokesperson said the regulator is assessing if the banks involved had adequate and appropriate controls against money laundering and terrorism financing, otherwise, action will be taken against them.
For now, Citigroup, DBS Group Holdings and other banks will have to ramp up their screenings of current and potential clients to avoid exposure to illicit flows. The banks that held the most assets in the scandal included Credit Suisse, Citigroup’s local unit and UOB.
Sources said Citi’s wealth bankers have a month to complete training that includes identifying money-laundering red flags – among the signs are potential clients from China who do not speak English, but own passports from Turkey, St Kitts and Nevis, or Vanuatu.
Another sign is significant transfers labelled “loan repayments” from Hong Kong-based companies with no online presence to Citi’s customers.
Meanwhile, DBS, which is Singapore’s largest bank, is tightening its vetting of major transactions by its clients.
The crackdown on the scandal saw 10 Chinese nationals charged and pleading guilty. They have been sentenced to jail terms of 13-17 months. Authorities are investigating and hunting down another 17 individuals.
The assets seized included cash, gold bars, jewellery, cars, and residential and commercial properties.
The 10 convicted were linked to accounts in 16 financial institutions in Singapore that held more than SG$370 million in deposits and investments.
According to court documents, the banks linked to the scandal gave out loans to businesses owned by the accused, arranged mortgages, managed investments and deposits. – June 10, 2024