Singapore Conducts Assessment of Money Laundering and Terrorist Financing Risks

Singapore has launched a comprehensive assessment of money laundering (ML) and terrorist financing (TF) risks in the country.

2.  The National Risk Assessment (NRA) is an ML/TF risk audit of not only the financial sector but also designated non-financial businesses and professions (DNFBPs) [1] in Singapore. The NRA will culminate in a report that includes an analysis of ML/TF threats and proposals to address the risks identified. Under the recently revised standards of the Financial Action Task Force (FATF), a country is expected to identify and assess its ML and TF risks, and to keep this assessment up-to-date.  The NRA will meet this expectation.

3.  A joint Steering Committee – led by the Ministry of Home Affairs, the Ministry of Finance, and the Monetary Authority of Singapore – has been coordinating the efforts of the government agencies [2] involved in the NRA. As part of the assessment, the various agencies are engaging relevant stakeholders to identify the risks that may arise in their respective sectors and to explore ways to mitigate them.

4.  As a trusted financial centre, Singapore is committed to detecting and deterring illicit funds from passing through its economy. Over the years, the various government agencies have been working closely with the industry to put in place appropriate anti-money laundering and counter terrorist financing measures, such as requiring financial institutions to review high tax-risk accounts, consider the AML/CFT risks arising from jurisdictions identified by the FATF, and mitigate any risks involved. The NRA will build on Singapore’s ongoing efforts to ensure that our financial sector and economy stay sound and clean.

5.  The results of the assessment will be presented in a report to be published by the end of 2013.

Steering Committee
(for combating money laundering and terrorist financing)

[1] FATF defines DNFBPs as: (i) Casinos, (ii) Real estate agents, (iii) Dealers in precious metals, (iv) Dealers in precious stones, (v) Lawyers, notaries and other independent legal professionals and accountants; and (vi) Trust and Company Service Providers. The full definition can be found in the General Glossary of the FATF Recommendations (February 2012).

[2] This includes the Attorney General’s Chambers, Ministry of Law, Commercial Affairs Department (Singapore Police Force), Corrupt Practices Investigation Bureau, Casino Regulatory Authority, Accounting and Corporate Regulatory Authority etc.

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Note to editor on FATF and the FATF Recommendations:

Singapore has been a member of the Financial Action Task Force (FATF) since 1992. The FATF is the global standard-setter for measures to combat money laundering, terrorist financing, and the financing of proliferation. It is an intergovernmental body comprising 36 members, with the participation of over 180 countries through a global network of FATFstyle regional bodies.

The FATF Recommendations are the international standards that sets out what countries should do to have effective systems for preventing and addressing money laundering, terrorist financing and the financing of proliferation. The Recommendations set out:

• the measures that countries should have in place within their criminal justice and regulatory systems;

• the preventive measures to be taken by financial institutions and other businesses and professions;

• the measures to ensure transparency on the ownership of legal persons and arrangements;

• the establishment of competent authorities with appropriate functions, and powers and mechanism for cooperation; and

• the arrangements to cooperate with other countries.

The revised FATF Standards (2012) has put additional emphasis on countries to have a coordinated approach to identify, assess and understand its money laundering and terrorist financing risks. In February 2013, the FATF released their Guidance on National Money Laundering and Terrorist Financing Risk Assessment to assist countries in the conduct of risk assessment at the country or national level. Please refer to the FATF website for more details on the Guidance document.

Note to editor on the Steering Committee (for combating money laundering and terrorist financing)

The Steering Committee, established in 1999, determines Singapore’s broad policy objectives for combating money laundering and terrorist financing. The Committee comprises the Permanent Secretary of the Ministry of Home Affairs, Permanent Secretary of the Ministry of Finance and Managing Director of the Monetary Authority of Singapore. It ensures that the various government agencies have effective mechanisms in place to enable them to cooperate and where appropriate, to coordinate domestically with each other to strengthen Singapore’s resilience against criminal abuse.