Two new departments at the Monetary Authority of Singapore (MAS) to combat money laundering and terrorism financing started work yesterday.
One will oversee all policy and supervision responsibilities related to such illicit financial activities while the other will undertake all enforcement actions against regulation breaches, including rules covering banking, insurance and capital markets.
The new dedicated departments will help MAS sharpen its supervision on anti-money laundering controls, which were previously carried out by several different bodies within the authority.
The enforcement capability will also be strengthened to allow “swift and dissuasive actions”, said MAS managing director Ravi Menon in the central bank’s annual report briefing last week, adding that it is ready to make public its sanctions against persistently errant financial institutions.
The initiatives were announced in mid-June amid rising international attention on the 1Malaysia Development Berhad (1MDB) scandal.
On May 24, MAS told BSI Bank to shut down in Singapore – the first such order to a merchant bank since 1984 – over its suspected involvement in money laundering linked to 1MDB.
On July 21 the central bank named DBS, Standard Chartered Bank and UBS in Singapore for “control failings” when managing 1MDB-related fund flows.
The central bank has also imposed financial penalties on 27 financial institutions for anti-money laundering and terrorist financing breaches over the past three years.
The number of its onsite inspections rose to 608 between 2013 and this year, up from just 108 in the previous three years.
But Mr Menon said in the briefing that the 1MDB findings have “made a dent” in Singapore’s reputation as a clean and trusted financial centre, and he vowed to “do better”.