IMC Strengthens Singapore AML Regime with Proactive Prevention, Timely Detection, and Effective Enforcement

The Inter-Ministerial Committee (IMC) of Singapore published the document on 4 October 2024 to exchange the “findings and recommendations” based on the audit conducted on the Anti-Money Laundering (AML) regime in Singapore.

The main goal is to include everyone from society, including financial institutions, company beneficial owners, enforcement agencies, and government, to work mutually to prevent and detect money laundering and effectively enforce AML measures and laws on time.

Five Pillars to Enhance Singapore’s AML Framework

The Inter-Ministerial Committee (IMC) has reviewed the August 2023 case of money laundering to evaluate the factors and draw the lessons to strengthen the AML framework of Singapore as financial crimes have evolved and techniques used in those illicit activities have advanced now.

The following are five major areas of consideration:

• How to protect the corporate sector effectively from money launderers so they couldn’t be able to perform illicit activities;
• How can financial institutions collaborate with other agencies to work together and improve their AML controls and policies to identify and prevent suspicious transactions;
• How can Business-like “corporate service providers, real estate salespersons and estate agencies, and precious stones and precious metals dealers” protect their business from financial risks such as money laundering risks and preserve the transparency of the financial system, including checking the efficacy of AML rules and regulation that are strong enough for stakeholders;
• How to streamline the efforts of the government and other agencies in addition to enhancing their capabilities to detect and report suspicious activities and
• How can procedures and regulations for firms be established to combat financial crimes and confiscate funds obtained from illicit activities, such as money laundering?

Recommendations of the Inter-Ministerial Committee (IMC)

Recommendations from the Inter-Ministerial Committee (IMC) will improve the AML regime in Singapore to combat financial crimes such as money laundering. They will not create difficulties for businesses that follow the rules, operate normally, and are not involved in illicit activities.

Strengthening the Three Key Foundations of AML

Recommendations of IMC are divided into three main categories: “Proactive Prevention, Timely Detection, and Effective Enforcement.”

The IMC has also evaluated the current and ongoing procedures to identify the recommendations mentioned below.

Proactive Prevention

Improving current AML rules and regulations to take “proactive prevention” for criminals to stop them from hiding or transferring illegal money obtained through illicit activities. The following are the main vital regulations:

• Enhancing AML regulations for stakeholders of financial institutions that act as front defenders to protect their business
• Assisting “gatekeepers” to increase their abilities to combat money laundering (ML) by making them learn and aware of the AML regime
• Improve ways, rules, and laws of the AML framework to stop companies from being used for illegal activities.
• Small companies or non regulated sectors that are not mandated to follow the AML regulations and involve them in making them understand financial crimes and money laundering (ML) risks.

Read Also:

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Timely Detection

They are making regulators, financial institution supervisors, and stakeholders aware of the importance of timely detection of illegal activities. An approach of timely detection will enable them to identify and address financial activities before they occur.

• They are improving their abilities to make and enforce AML rules and exchange information between different sectors under the government.
• They are developing better, more progressive ways to exchange information across sectors and stakeholders.

Effective Enforcement

Implement productive laws on the financial criminals who are involved in illicit activities by;

• Enabling the law enforcement agencies to implement AML laws stronger for setting punishment or penalties in response to money laundering (ML) offense
• Constantly assess the penalty regime’s criteria to ensure they are upgraded and effective to discourage financial criminals.
• Increase the collaboration between agencies to take better AML measures for combating illicit activities such as money laundering.

Singapore Strengthens Measures Against Financial Crimes

• The latest measures of Singapore, in the recommendation of IMC, have been released to combat financial crimes such as money laundering.
• Financial crimes will keep advancing and continue to be a potential danger for all financial institutions worldwide.
• As per the media release from the Monetary Authority of Singapore (MAS), Singapore will continue to commit firmly to this. It will keep putting effort into fulfilling the commitment requirements by integrating AML measures “to detect and deter” financial crimes and protect the financial ecosystem in Singapore by ensuring there will not be challenges for legitimate businesses and stakeholders.