The Monetary Authority of Singapore (MAS) has announced hefty penalties totalling S$27.45 million (US$21.55 million) against nine financial institutions (FIs) due to breaches related to a significant money laundering case that involved over S$3 billion in assets. This enforcement action follows investigative examinations conducted between early 2023 and early 2024, with the findings released on 4 July 2024.
Major Players Among Those Penalised
- Credit Suisse was hit with the highest penalty of S$5.8 million.
- Other banks penalised include United Overseas Bank (UOB), UBS, and Citibank.
- Additional penalties were imposed on Julius Baer, Blue Ocean Invest, Trident Trust Company, and LGT Bank.
This action is among the largest imposed by MAS for breaches related to anti-money laundering and countering the financing of terrorism (AML/CFT) regulations, trailing only the fines levied during the 1Malaysia Development Berhad (1MDB) case.
Identified Breaches
MAS highlighted several critical failures among the financial institutions:
- Inadequate customer risk assessments were reported, leading to mis-rating of money laundering risks.
- Eight institutions failed to take necessary actions despite suspicious transactions being flagged by their systems.
- All nine FIs lacked sufficient measures to verify the source of wealth for high-risk customers.
Consequences for Individuals Involved
The penalties extend to individuals with prohibition orders issued against four senior managers from Blue Ocean Invest, including CEO Tsao Chung-yi, who faces a six-year ban. These actions are part of MAS’s broader strategy to strengthen compliance within the financial sector.
Strengthening Financial Integrity
In light of these findings, MAS’s Deputy Managing Director for Financial Supervision, Ms Ho Hern Shin, emphasised the importance of robust AML/CFT implementations. She stated, “The vigilance of our financial institutions and their employees is critical in mitigating such risks.” The regulator plans to closely monitor the progress of the institutions in remedying their compliance shortcomings.
Recent Developments in the Case
The investigations leading to these penalties were prompted by notable police raids across Singapore in August 2023, which resulted in the conviction and deportation of 10 foreign nationals linked to an organised crime syndicate. The authorities seized over S$3 billion in assets associated with these individuals.
As financial institutions work to improve their compliance mechanisms, MAS reiterates its commitment to maintaining a strict regulatory environment to safeguard Singapore’s financial integrity.