Mar 23 2020 | by OrionW
The Monetary Authority of Singapore (MAS) penalised a Singapore trust company S$400,000 for failing to comply with anti-money laundering and countering the financing of terrorism (AML/CFT) requirements under the MAS Act.
MAS found that TMF Trustees Singapore Limited (TTSL), over a period of almost seven years, failed to verify the source of wealth of trust creators and failed to monitor the transactions of parties relating to trust assets. As a result, MAS determined that TTSL’s AML/CFT controls and procedures were ineffective, putting TTSL at risk of being used for money laundering and/or terrorism financing (ML/TF) activities.
The S$400,000 penalty reflected a composition of penalties that could have amounted to S$1 million per offence. MAS cited the company’s prompt response to address the deficiencies identified by MAS, such as engaging a consultant to identify the root cause of the failures and strengthening its AML/CFT program to prevent future lapses. The company also voluntarily chose not to accept new trust customers for three months so that it could focus on its AML/CFT program.
In announcing the penalty, a MAS official noted that financial institutions that set up trusts and other investment structures or dealing with customers who use such vehicles must have robust and effective AML/CFT controls, with strong oversight by their boards and senior management.
The threats of money laundering and terrorist financing continue to evolve and companies in Singapore must take AML/CFT requirements seriously. Companies should conduct thorough due diligence on customers, monitor transactions and periodically review their policies, procedures and controls to ensure compliance with the requirements.
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Disclaimer: This article is for general information only and does not constitute legal advice.