Background Checks on Foreign Nationals before They Set Up Singapore Companies

Parliamentary Question by Mr Gerald Giam Yean Song:

To ask the Deputy Prime Minister and Minister for Finance (a) what background checks are undertaken on foreign nationals before they are allowed to set up Singapore companies; (b) how does ACRA verify whether these companies’ activities are in line with what their directors declared when they were seeking incorporation; and (c) how actively does ACRA investigate companies to verify whether they are conducting activities in accordance with their incorporation documents.

Parliamentary Reply by Deputy Prime Minister and Minister for Finance, Mr Lawrence Wong:

Foreign nationals based overseas must engage the services of an ACRA-Registered Filing Agent (RFA) to set up Singapore companies. The RFA is a professional services firm, such as a law firm, accounting firm or corporate secretarial firm. The RFA is responsible to conduct customer due diligence, including verifying identity and background information, confirming the veracity and adequacy of documents, and obtaining beneficial ownership information. They are also required to perform ongoing transaction monitoring on their customers and their companies’ business activities after incorporation, to ensure that the activities are consistent with the RFA’s knowledge of the customer, business and risk profile. They must report any suspicious transactions to the Police.

In addition, ACRA will investigate if it receives information that a company is not conducting activities in line with what was declared at incorporation. The company will be referred to the Police if it is suspected to be engaging in illegal activities. To facilitate this, ACRA also makes publicly available much of the information lodged by companies. This helps to ensure that the members of public accessing this information can report any discrepancies to ACRA.

Should there be any indication of false filings, ACRA will take enforcement action against the RFA. Persons who have knowingly provided false or misleading information to ACRA may be subject to fines or imprisonment.