Singapore’s central bank has launched a probe into the banks involved in a $1.75 billion money laundering scandal in the global wealth hub.
The Monetary Authority of Singapore (MAS) said it will take action if its findings reveal shortcomings in the banks’ controls, a spokesperson said in an emailed statement on Monday.
Singapore police last month arrested and charged 10 foreigners including from China, in one of the biggest anti-money laundering swoops. Assets worth S$2.4bn were seized, including luxury real estate, cryptocurrencies and cars.
The scandal has raised questions on whether the banks are strictly following the city-state’s stringent anti-money laundering rules.
“Supervisory engagements with these [financial institutions] are ongoing to assess whether they had taken all reasonable steps to mitigate against money laundering/terrorism financing risks,” the MAS spokesperson said.
“We will take action where the FIs’ controls have fallen short, as we have done in past cases.”
The MAS said it was too early to tell if all the financial institutions involved in the scandal had adhered to its stringent requirements on anti-money laundering and countering the financing of terrorism.
Singapore has benefited from huge asset inflows in the last few years, with wealthy individuals in Asia and elsewhere setting up family and trust offices to take advantage of incentives offered to such setups.
The number of single-family offices, which handle investments, taxation, wealth transfer and other financial matters for the super-rich, had surged to 1,100 at the end of 2022 from 400 at the end of 2020, MAS data showed.
The latest figures from the MAS also showed that total assets under management in Singapore rose 16% to S$5.4 trillion in 2021, compared with a global increase of 12% to $112 trillion for the same year.
“The wealth management sector remains a key area of supervisory focus for MAS and we have conducted thematic inspections, focusing on enhanced due diligence measures, including corroboration of source of wealth and source of funds,” the MAS said in Tuesday’s statement.
- Reuters with additional editing by Sean O’Meara