Singapore parliament approves new AML Bill to align with international standards

The Singapore parliament approved the Anti-Money Laundering and Other Matters (AMLOM) Bill at second reading 6 August. The new Bill is designed to align Singapore’s AML/CFT framework with international standards, enhance the ability of government agencies to detect and enforce against money laundering, and improve processes for dealing with seized or restrained properties linked to suspected criminal activities.

The Bill will amend the Corruption, Drug Trafficking & Other Serious Crimes (Confiscation of Benefits) Act (CDSA), such that prosecutors will no longer need to prove that the monies allegedly laundered in Singapore were benefits from criminal conduct, nor show the complete trail. It will be sufficient for prosecutors to prove that the money launderer knew or had reasonable grounds to believe that the property he was dealing with were the gains from criminal conduct.

This amendment will significantly alleviate the challenges currently faced by prosecutors when dealing with money laundering offences, in cases where the monies laundered have passed through many bank accounts and intermediaries in foreign jurisdictions before entering Singapore.

The Bill also introduces a new schedule to the CDSA, which will designate serious foreign environmental crimes – illegal logging, land clearing, mining, waste trafficking and wildlife trade – as money laundering predicate offences. The amendment will allow the law enforcement agencies to investigate money laundering offences if it is suspected that the monies in Singapore are derived from such serious environmental crimes committed overseas.

The Bill amends the Income Tax Act, Goods & Services Tax Act, Regulation of Imports & Exports Act, and the Free Trade Zones Act to allow the Inland Revenue Authority of Singapore (IRAS) and Singapore Customs to share tax data and trade data respectively with Singapore’s Financial Intelligence Unit. This will provide more detailed financial intelligence to law enforcement agencies and AML/CFT regulators.

The Bill further amends the CDSA to allow any AML/CFT regulator, such as the Council for Estate Agencies and the Accounting & Corporate Regulatory Authority (ACRA), to have access to suspicious transactions reports filed by their respective regulated entities.

The Bill will amend both the CDSA and the Criminal Procedure Code (CPC) to allow the courts, subject to strict conditions, to order the sale of a seized or restrained property without the consent of all parties involved. This will enable law enforcement agencies to reduce the cost of property maintenance and preserve the value of seized or restrained properties, to facilitate subsequent asset recovery and restitution to the victims.

The CPC will also be amended to include a requirement that an absconded person who is suspected of having committed an arrestable offence under Singapore laws or a serious offence under the CDSA, must personally present himself or herself before a law enforcement officer to assist in the investigations, prior to making a claim to property seized in respect of the offence.

Likewise, the court will consider whether seized property was obtained through legitimate sources, such as income or investments, before it can be released to a third party. That party cannot prove entitlement to the property simply because it was a gift from the absconded person.

These amendments will enable the government to better deal with absconded suspects, through depriving them of the financial gains of their money laundering and other criminal activities, if they refuse to return to Singapore for investigations. The proposal does not change the existing law or procedures for persons who are not ‘absconded persons’.

Finally, to align with the Financial Action Task Force (FATF) standards, the Bill will amend the Casino Control Act to require casino operators to conduct tighter Customer Due Diligence (CDD) checks on patrons at the point of transaction. The threshold for CDD checks will be lowered from the current threshold of single cash transactions involving SGD10,000 or more, or deposits into a deposit account involving SGD5,000 or more, to cover single cash transactions or deposits involving SGD4,000 or more.

The Gambling Regulatory Authority of Singapore will also be empowered to require casino operators, when conducting CDD checks, to also consider proliferation financing risks. These are the risks of financing the proliferation of weapons of mass destruction.

“The Bill’s provisions to strengthen enforcement are crucial for ensuring that AML regulations are not only in place but actively enforced,” said Andrew Galway, Managing Director of Sovereign Management Services in Singapore. “Clear penalties for non-compliance and resources for monitoring will enhance deterrence.”