MAS issues $27.45m in penalties to 9 financial institutions over $3b money laundering case
MAS identified the nine FIs through supervisory examinations conducted between early 2023 and early 2025, according to a statement released on Friday (July 4).
The nine FIs being penalised — including banks like Credit Suisse Singapore Branch, United Overseas Bank Limited (UOB) and UBS AG, Singapore branch — were found to have breaches in connection with anti-money laundering and countering the financing of terrorism (AML/CFT) to persons of interest (POIs) in the major money laundering case.
According to MAS, the penalties took into account various factors including the extent of the FI's exposure to the POIs, the number of breaches of MAS' requirements, among others.
Credit Suisse was fined $5.8 million, the highest of the nine FIs.
Through its investigations, MAS generally did not find a pervasive lack of AML/CFT controls, but found that breaches arose out of "poor or inconsistent implementation".
Out of the nine FIs involved, five failed to perform adequate customer risk assessments, which subsequently led to a mis-rating of money laundering risks and their ability to implement appropriate controls.
MAS also found that eight FIs failed to take appropriate measures despite having suspicious transactions being flagged by their systems. In such cases, there was insufficient vigilance regarding transactions that were unusually large or inconsistent with customers' profiles.
Establishing and corroborating the source of wealth of customers who posed higher risks of money laundering was also observed in all FIs being penalised.
Regulatory action against individuals
Apart from the nine FIs, MAS also issued prohibition orders ranging from three to six years against individuals who were involved in the managing the financial institutions' relationships with the POIs.
The four individuals identified were from Blue Ocean Invest (BOIPL), one of the nine FIs being penalised, including CEO and executive director Tsao Chung-yi.
Tsao will serve a six-year prohibition order from Aug 1, along with Wong Xuan Ling, COO of BOIPL, who will serve a five-year prohibition order.
Both Tsao and Wong "failed as senior managers to ensure that the AML/CFT policies and controls in BOIPL kept pace with significant growth in its business in the three years since the company was set up", said MAS.
Hsia Lun Wei, an executive director and relationship manager, and Deng Xixi, a former relationship manager, both from BOIPL, were also issued three-year prohibition orders with effect from June 30.
For the duration of their prohibition orders, they will be barred from carrying out any business regulated by MAS, and will also be prohibited from taking part, directly or indirectly, in the management of a financial institution.
MAS also issued public reprimands to five individuals, and private reprimands to nine individuals, for their failure to ensure due diligence and implement AML/CFT policies sufficiently.
According to MAS, a reprimand is "issued to an individual based on their misconduct at the material time".
FIs should adopt best practices: MAS
Following the major money laundering case, MAS published supervisory expectations in October last year regarding the controls that FIs should implement.
The banking industry also published best practice papers on implementing such controls, which "FIs should benchmark themselves against", so that they can "execute robust, reasonable and risk-proportionate defences" against money laundering.
"MAS will work closely with financial institutions to promote more consistent implementation of AML/CFT measures. Where there are serious failings by FIs and their employees, MAS will not hesitate to take firm action," said Ho Hern Shin, Deputy Managing Director (Financial Supervision), MAS.
Speaking to AsiaOne, a UOB spokesperson said that the bank acknowledges and accepts MAS' findings, and is "fully committed to ensuring compliance with regulatory requirements and to upholding the integrity of the Singapore financial system".
"Over the past two years, we have implemented prompt remedial actions to address the deficiencies identified after a comprehensive internal review, including stepping up on our transaction monitoring and customer due diligence processes," said the spokesperson.
UOB has also made significant investments in technology to enhance internal risk management standards, while boosting employee training so that they can "the highest professional and ethical standards".
Singapore's largest money laundering case
Simultaneous raids across Singapore on Aug 13, 2023, involving over 400 police officers, resulted in the arrest of 10 foreign nationals for their links to organised crime, including scams and online gambling.
The 10 convicted, who were all Chinese nationals with citizenship in countries like Turkey and Cambodia, were Su Haijin, Su Baolin, Vang Shuiming, Wang Dehai, Su Jianfeng, Chen Qingyuan, Su Wenqiang, Wang Baosen, Zhang Ruijin and his lover Lin Baoying.
They have all been jailed, deported and barred from re-entering Singapore.
In total, over $3 billion worth of assets were seized, including properties, vehicles and country club memberships.
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dana.leong@asiaone.com
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