In an article released by The Monetary Authority of Singapore (MAS) on 19 March 2020, MAS imposed a composition penalty of $400,000 on TMF Trustees Singapore Limited (TTSL) on 16 March 2020 for failure to comply with MAS’ Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) requirements, which were identified following an inspection by MAS.
MAS stated that TTSL failed to verify the source of wealth of settlors of trusts and had only relied on the settlors’ representations regarding their source of wealth or bank reference letters which, without obtaining information to adequately corroborate those claims. TTSL also failed to monitor, on an ongoing basis, the transactions of trust relevant parties (TRPs), particularly the failure to ensure that transactions were consistent with its knowledge of the TRPs’ business and risk profile as well as the source of funds.
MAS assessed that TTSL did not exercise sufficient oversight to ensure effective AML/CFT controls and procedures. This placed TTSL at risk of being used as a conduit for ML/TF activities.
MAS wants to take this case as a timely reminder to financial institutions involved in setting up these structures or dealing with customers who use such vehicles, to have in place robust controls to prevent them from being misused for ML/TF.
RHT Compliance Solutions (RHTCS) would like to reiterate to all Financial Institution’s (FIs), Board and Senior management to exercise strong oversight over the ML/TF risks and ensure the effectiveness of the AML/CFT controls implemented. RHTCS also urges all FIs to revisit MAS’ AML/CFT requirements set out in MAS Notice on Prevention of Money Laundering and Countering the Financing of Terrorism.
Full text can be found here.
RHTCS can assist FIs with the compliance requirements in Singapore. We can assist to evaluate FIs AML/CFT controls to align with the requirements set out in the MAS regulations. Our reviews take a risk-based approach and include reviewing existing policies and procedures and risk mitigation processes and systems.
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