On 19 March 2020, the Monetary Authority of Singapore imposed a composition p...


Trust company penalised S$400,000 for AML/CFT failures

March 23, 2020

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.

Key Takeaway

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.

For More Information

OrionW regularly advises clients on anti-money laundering and countering the financing of terrorism matters.  If you require assistance or if you have any questions about this article, please contact us at fintech@orionw.com.

Disclaimer: This article is for general information only and does not constitute legal advice.


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