Opening Remarks by Ms Indranee Rajah, Minister in the Prime Minister’s Office, Second Minister for Finance and National Development, for the Press Conference on the Inter-Ministerial Committee to Review Singapore’s Anti-Money Laundering Framework

Good morning everyone.

Introduction

      Thank you for joining us at this press conference on the Inter-Ministerial Committee’s (IMC) review of Singapore’s anti-money laundering framework. 

2   First, let me introduce my colleagues, Minister of State Sun Xue Ling and Minister of State Alvin Tan who also helped oversee the work of the IMC. Two other Ministers of State, Ms Gan Siow Huang and Ms Rahayu Mahzam, were also part of the IMC.

About the Inter-Ministerial Committee

3   Let’s first start with the work of the IMC. Singapore has a strong rule of law and we are firmly committed to ensuring that Singapore is and continues to be a trusted global financial centre.

4   To that end, we have over the years built up a good system to detect and act against illicit fund flows.

5   This system enabled the Singapore Police Force and other agencies to crack open a major money laundering case involving a significant amount of assets last August, and to take enforcement action against those involved.  

6   Notwithstanding the successful disruption of this ring of perpetrators, we felt it would be good to take the opportunity to use the lessons learned from this case to enhance and further strengthen our system.

7   Consequently, last year, we set up the Inter-Ministerial Committee to review Singapore's anti-money laundering framework, to keep pace with increasingly sophisticated crimes and better tackle money laundering challenges. 

8   Over the past year, the IMC reviewed five key areas: 

a.   How to better prevent money launderers from misusing corporate structures;

b.   How financial institutions can enhance their controls and collaborate more effectively with each other and the authorities to identify and flag suspicious transactions; 

c.   How other gatekeepers in the system, like corporate service providers, real estate salespersons and estate agencies, and precious stones and metals dealers can help to better guard against money laundering risks, including the adequacy of the existing regulatory framework over these players;  

d.   How to better centralise and strengthen monitoring and sensemaking capabilities across government agencies to detect suspicious activities; and

e.   How to strengthen enforcement levers and capabilities to enable firm and decisive actions against money launderers, including depriving them of their ill-gotten proceeds. 

9   As part of our review, we have also engaged with industry stakeholders, to seek their feedback and bring them into the fold for the objective of a whole of society approach to combat money laundering.  

Summary of Inter-Ministerial Committee’s recommendations

10   Before I elaborate on the key thrusts of the recommendations, I would like to highlight a few things: 

a.   First, even before the IMC was set up, our agencies were already working on some measures to strengthen the system as part of their regular oversight. This was very helpful to the work of the IMC as it gave us a running start, rather than a standing start. The IMC review therefore included reviewing measures already in train, as well as developing new measures, with the benefit of insights from the recent cases.

b.   Second, our recommendations have been carefully calibrated with two twin objectives in mind: one, to strengthen our defences and two, to do so in a manner that keeps us open and facilitative of business and to minimise the impact on the vast majority of legitimate businesses. As you will appreciate, this is a fine balancing act – because for every step and every measure there are trade-offs. The system cannot be too lax but at the same time it cannot be too stringent, because we do not want to stifle genuine, law-abiding businesses. It has to be “just right” and allow Singapore to be a free and open economy while at the same time being inhospitable to illicit funds.  

c.   Third, while I can share the broad policy thrusts, there are some measures which are operationally sensitive, and hence we are unable to share the specific details publicly because doing so would reveal our hand to criminals and undermine our law enforcement efforts.

11 Let me now summarise the IMC recommendations. Broadly, the recommendations strengthen the three prongs of our anti-money laundering framework – Prevention, Detection and Enforcement.

a.   Prevention is our first line of defence. We wish to proactively prevent criminals from laundering their illicit assets in Singapore, and the recommendations focus on how we can leverage and build upon our existing structures to do so. 

i.   A critical group in prevention are the gatekeepers, e.g.  financial institutions and real estate salespersons. Gatekeepers are at the forefront of our defences against money laundering. 

ii.   To enable better gatekeeping, we will strengthen our anti-money laundering standards, and provide more support to gatekeepers to equip them to better comply with our regulations. Sector supervisors will update their guidance in the coming months, so that gatekeepers are clearer on what is expected of them. Sector supervisors will also continue to engage the industry and share more, including their observations on changing risks.

iii.   We will also help gatekeepers to build capabilities, such as training in what to look out for in identifying suspicious transactions, and to have a better understanding of their obligations. The sectors will work on raising professionalism and ethical standards.

b.   But we must be realistic – prevention alone is not enough.  All international financial centres and business hubs face money laundering risks. No defence is foolproof and at some point, money laundering will inevitably occur.

c.   If such activities slip past the first line of defence, then the next line of defence is detection.

i.   The recommendations therefore also look to how we can better detect such activities in a timely manner. 

ii.   And to do so, we will strengthen our sense-making and information-sharing mechanisms. 

iii.   To this end, we are developing a new whole-of-government data-sharing interface which will be known as – “NAVIGATE”. NAVIGATE will pull together information and provide agencies with a more comprehensive picture of potential money laundering risks, and enable them to better detect individuals and entities of concern. 

d.   Finally, once money laundering is detected, we must have the means and resolve to take effective enforcement action.

i.   Today, we already have in place an inter-agency task force comprising selected agencies which collaborate on dealing with money laundering cases. 

ii.   We will reinforce this work, by expanding the membership of this task force to include all agencies involved in combatting money laundering. This enhanced platform will be known as the Anti-Money Laundering Case Coordination and Collaboration Network, or AC3N (“Ascend”). Ascend will have a higher level of oversight than the previous taskforce, and build on existing mechanisms to allow more agencies to work together to strengthen inter-agency coordination for supervisory and enforcement action.

iii.   We will also regularly review our penalty frameworks to encourage the right behaviour among gatekeepers. 

Conclusion

12   So as not to lose any time in our AML efforts, we have already started implementing recommendations that were in the pipeline or which could be done quickly. 

13   We will implement the other recommendations as soon as possible.

14   However, I should sound a cautionary note and say that we are under no illusion that these recommendations will be the silver bullet to eradicate money laundering.  Experience has shown that every time financial system and law enforcement agencies take steps to combat financial crime, criminals will inevitably adjust their tactics and develop new ways to disguise, hide and benefit from their illicit assets. So, we too must remain dynamic.  In any jurisdiction, be it here or elsewhere, zero money laundering is impossible. What is possible – and which is our goal – is strong deterrence, good detection and effective enforcement.   

15   In conclusion, let me say: Singapore is open for business. We welcome clean funds and legitimate investments which generate economic growth, generate jobs and create real value for our people and our country. 

16   But we will be hostile ground for illegal funds and criminal activities, and should they find their way to our shores we will not hesitate to take action against the individuals involved in accordance with the full force of the law.