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Singapore’s Property Agents Investigated for Money Laundering: Key Points and AML/CFT Considerations

Money LaunderingSingapore's Property Agents Investigated for Money Laundering: Key Points and AML/CFT Considerations

The Council for Estate Agents (CEA) in Singapore is investigating several property agents for potential involvement in illicit transactions following a series of high-end property raids in August that recovered nearly $1 billion in laundered assets. Here are key points and considerations regarding this development:

  1. Recovery of Laundered Assets: Singapore authorities conducted high-end property raids in August, resulting in the recovery of approximately $1 billion in laundered assets. These assets included cash and non-financial assets, such as luxury properties.
  2. Suspicious Transaction Reports (STRs): The raids were initiated based on suspicious transaction reports (STRs) from various financial institutions. The Monetary Authority of Singapore (MAS) and the Commercial Affairs Department (CAD) launched the investigation in response to these reports.
  3. Focus on Other Sectors: In addition to the real estate sector, the investigation has also focused on other sectors involved in the money laundering scheme. This includes traders of precious stones and metals, as well as the international gambling industry.
  4. CEA’s Response: The CEA responded to the raids by reminding real estate firms of their obligations under the Estate Agents Act 2010 (EAA). Firms failing to comply with the EAA and related regulations could face disciplinary action, including financial penalties and license suspension or revocation.
  5. AML/CFT Obligations: Real estate firms in Singapore have specific anti-money laundering and counter-terrorist financing (AML/CFT) obligations. These include conducting customer due diligence (CDD), reporting suspicious transactions, maintaining CDD records, and implementing internal AML/CFT controls and policies.
  6. FATF’s Evaluation: Singapore’s AML/CFT framework, particularly in designated non-financial businesses and professions (DNFBPs), was subject to evaluation by the Financial Action Task Force (FATF). The FATF highlighted areas for improvement in its 2016 Mutual Evaluation Report (MER). Singapore has since been committed to enhancing its AML/CFT framework.
  7. Red Flags: Firms in the real estate sector should be familiar with red flags related to terrorist financing or money laundering in real estate transactions. These red flags may include negative news about the client, reluctance to connect the client’s name with the property, unusual transaction values, and anonymous payment preferences.
  8. Obligations Under Singapore Law: Firms should review their obligations under Singaporean law, particularly the CEA’s notice and relevant regulations, to ensure compliance with AML/CFT requirements.

The recovery of laundered assets and the subsequent investigations highlight the importance of robust AML/CFT measures in the real estate sector and the broader financial industry in Singapore. Firms should prioritize compliance with regulatory obligations and stay vigilant for potential red flags.

By FCCT Editorial Team

Disclaimer: The views expressed in this article are independent views solely of the author(s) expressed in their private capacity.

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