Registrar of Regulated Dealers issues notice on Environmental Crimes Money Laundering National Risk Assessment
30 July 2024
On 13 June 2024, the Registrar of Regulated Dealers issued a notice to all regulated dealers (“Notice”) on the Environmental Crimes Money Laundering National Risk Assessment (“NRA”), which presents an overview of Singapore’s environmental crimes money laundering (“ML”) risk environment, identifies the key threats and vulnerabilities in environmental crimes ML that Singapore is exposed to, and outlines risk mitigation measures.
The NRA notes that Singapore’s key exposure to environmental crimes ML stems from its position as a transit country, both as an international financial centre and as an international trading and transport hub. Singapore’s key environmental crimes ML threats are assessed to be illegal wildlife trade and illegal logging and waste trafficking. Corruption, bribery, and tax evasion offences may also be linked to environmental crimes.
Among other things, the NRA reports that:
- environmental crimes and the laundering of their proceeds endanger the environment and have a far-reaching impact;
- criminals could launder proceeds from environmental goods though layering, under the guise of loans or payments, and using cash deposits, electronic payments, and third-party wire transfers;
- criminals may use shell companies to hide beneficial owners to launder proceeds from environmental crimes such as illegal mining; and
- proceeds from environmental crimes or from corruption, bribery, or tax evasion linked to environmental crimes may be used to purchase precious stones, precious metals, or precious products (“PSPMs”) to hide the illicit origin of these funds.
The Notice states that regulated dealers should take reference from the NRA in assessing their environmental crimes ML risks and enhance their controls as appropriate. Regulated dealers are encouraged to do the following:
- Be alert to the potential vulnerabilities outlined in the NRA. PSPMs tend to be good stores of value and accepted as an alternative to monies and could be used in the layering and integration of funds in ML transactions.
- Take the appropriate risk mitigation measures such as understanding, detecting, and reporting suspicious transactions to guard against the environmental crimes ML risk that their business may be abused, where relevant.
Reference materials
The Notice is available on the Ministry of Law website www.mlaw.gov.sg.