June 24, 2024
By Sharan Kaur Phillora
Singapore has released its updated Money Laundering National Risk Assessment (MLNRA), highlighting significant risks and vulnerabilities associated with digital payment token (DPT) service providers in the anti-money laundering (AML) landscape.
Here’s what we know:
The comprehensive 126-page report, published on June 20, 2024, identifies new risk sectors not included in the previous 2014 assessment. These include DPT service providers and precious stone and metal dealers.
While the banking sector, including wealth management, is identified as posing the highest money laundering risks, DPT service providers stand out as a high-risk category within the financial sector. The MLNRA highlights an increase in reported money laundering cases involving DPTs and various exploitation methods.
Singapore’s key money laundering threats stem from fraud, particularly cyber-enabled fraud, organized crime, corruption, tax crimes, and trade-based money laundering. Common money laundering methods include hiding illegal funds in Singapore bank accounts, using shell companies, and investing in valuable assets like real estate or precious metals.
Despite the relatively small portion of global DPT activities in Singapore, authorities are closely monitoring the associated risks. Other high-risk financial industry sectors include payment institutions offering cross-border money transfer services and external asset managers.
The MLNRA report combines insights from Singapore’s supervisory and law enforcement agencies, including the Financial Intelligence Unit, as well as feedback from private sector entities and foreign authorities.
Singapore’s status as an international financial hub and its economic openness expose it to money laundering risks, with criminals exploiting the country’s financial and business infrastructure to launder or transfer illicit funds.
The findings from this updated assessment will guide ongoing efforts to ensure Singapore’s AML regime keeps pace with identified risks and help stakeholders strengthen their risk-based measures.
About the author
Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.
