Legislative changes to strengthen AML/CFT framework in Singapore in force from 1 April 2019: Allen & Gledhill

29 April 2019

On 1 April 2019, the Serious Crimes and Counter-Terrorism (Miscellaneous Amendments) Act 2018 (“Amendment Act”) came into operation. The Amendment Act introduced amendments to two Acts that set out the anti-money laundering and counter-terrorism financing (“AML/CFT”) framework in Singapore, namely:

the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (“CDSA”) which criminalises the laundering of benefits from serious criminal offences and provides for powers to investigate and confiscate benefits from money laundering offences; and
the Terrorism (Suppression of Financing) Act (“TSOFA”) which criminalises the provision of property and services for terrorist purposes and provides powers to seize and confiscate terrorist property.

Key amendments

The amendments in the Amendment Act aim to:

strengthen the Government’s ability to enforce and prosecute offences relating to money laundering and terrorism financing;
enhance penalties for offences relating to money laundering and terrorism financing; and
facilitate sharing of financial intelligence with foreign jurisdictions.

Strengthen Government’s ability to enforce and prosecute offences relating to money laundering and terrorism financing

The CDSA has been amended to:

Create a new offence if a person possesses or uses any property reasonably suspected of being criminal proceeds and fails to account satisfactorily for how he came by the property. This new money laundering offence enables the prosecution of, for example, money mules who transport criminal proceeds for organised syndicates;

Introduce a presumption clause such that an act that is committed abroad, which amounts to a drug dealing or serious offence if committed in Singapore, is presumed to be an offence in that foreign country, once the prosecution can adduce prima facie evidence.

In addition, the Amendment Act expands the scope of activities prohibited under the TSOFA to include the financing of, and the provision/collection of funds to finance, the travel of an individual to engage in terrorist training.

Enhance penalties for offences relating to money laundering and terrorism financing

The penalties for, among other things, the following offences under the CDSA and TSOFA have been enhanced:

Offence under the CDSA for not filing a Suspicious Transaction Report (“STR”) when one has reason to suspect that a property is linked to a drug dealing or serious offence;
Offence under the CDSA for tipping off another person of a CDSA-related investigation or an STR filed with the Suspicious Transaction Reporting Office (“STRO”) of the Commercial Affairs Department;
Money laundering offences under the CDSA and terrorism financing offences under the TSOFA against non-individuals, such as corporations, which are convicted of such offences. The maximum fine for the offence now is the higher of (a) S$1 million or (b) twice the value of the property involved, benefits received from criminal conduct/drug dealing or services rendered in respect of which the money laundering or terrorism financing offence was committed.

The Amendment Act also implements a wider range of penalties and new provisions to pursue confiscation of undeclared cash for breach of Singapore’s cross-border cash reporting requirements.

Facilitate sharing of financial intelligence with foreign jurisdictions

Previously, under the CDSA, the STRO could only share financial intelligence with other Financial Intelligence Units (“FIUs”) with which it has an arrangement or undertaking. The Amendment Act has amended the CDSA to allow the STRO to also share information under an international arrangement. The STRO intends to share financial intelligence with other jurisdictions which have endorsed the Egmont Charter and Principles for Information Exchange, which is an international arrangement to enhance cooperation between FIUs, including sharing of information. This will improve the sharing of information to tackle transnational crimes.

Reference materials

The following materials can be accessed from the Singapore Statutes Online website sso.agc.gov.sg: