2023-10-09 08:21:29
Singapore banks are reportedly taking longer than usual to complete due diligence on customers and closing accounts in some cases as procedures tighten following the financial hub’s biggest money laundering scandal , which involved assets worth $2 billion.
Banks including Oversea-Chinese Banking Corp Ltd (OCBC), Citigroup Inc and United Overseas Bank (UOB) are requesting more documents than usual in some cases to verify sources of wealth, two of the sources said.
In addition, wait times for wealthy individuals to open a bank account have increased significantly from the usual one to three months before the scandal, said the sources, who spoke under the cover of anonymity due to the sensitive nature of the matter.
In a statement, the Monetary Authority of Singapore said financial companies must verify the identity of their customers, establish the origin of wealth and funds of high-risk customers and monitor transactions.
“These requirements are not new,” the central authority responded to a Archyde.com request for comment. “Given the characteristics and size of their transactions, high net worth individuals are often subject to stricter controls by financial institutions.
The banks’ due diligence changes follow the police arrest and charging in August of ten foreigners, all from China, a major source of inflows, under of the most spectacular operation of its type in Singapore.
Authorities have seized assets worth around $2 billion, ranging from luxury real estate and cryptocurrencies to gold bars, designer handbags and funds deposited in banks such as Credit Suisse and Julius Baer.
A source, a wealth manager at a Singapore bank, said following the scandal that only “high-quality clients with a good profile and significant assets under management” might hope to open a private bank account in a period of three months.
A spokesperson for Singapore’s second-largest bank, OCBC, said it was devoting “significant” resources to continually strengthening controls and working closely with regulators and peers to guard once morest illicit activities. .
“We are committed to combating money laundering and ensuring the highest standards of governance and oversight,” Citi said. “We have worked with authorities to strengthen and protect the integrity of the financial system.
In a statement, UOB said it was vigilant once morest money laundering or terrorist financing risks and carried out robust controls as part of its due diligence checks, using analysis of data and technological solutions.
Credit Suisse and Julius Baer declined to comment.
EXAMINATION OF ACCOUNTS
The scandal comes as the city-state experiences a sharp increase in asset flows from China, Hong Kong and elsewhere, attracted by its relative political stability, low taxes and pro-business policies. funds.
According to the latest figures from the central bank, total assets under management in Singapore increased by 16% to S$5.4 trillion in 2021, higher than the 12% increase recorded worldwide in the same year. to reach 112,000 billion dollars.
As the scandal has challenged Singapore’s image as a hub of wealth, authorities are stepping up inspections of financial firms suspected of being involved in the affair.
The strengthening of controls has led some banks to part with certain clients.
A Chinese national and permanent resident of Singapore said OCBC Bank informed him last month that it would close his account, which had been open for regarding ten years, without giving a reason.
“We have carried out an examination of the accounts […] and we regret that we can no longer support them,” OCBC said in an opinion reviewed by Archyde.com, adding that it was unable to specify the factors behind its decision.
The person, who requested anonymity, believes the closure was due to suspicions of money laundering, as the account was the subject of regular transactions with business partners in China.
OCBC has not commented on this particular case.
A real estate agent, who advises wealthy foreign and domestic individuals, said opening bank accounts was now taking much longer than usual for some clients.
“Business is very difficult for us now, there are so many obstacles to overcome,” the agent added. “But it is better to be very careful than to be involved in crime. (Reporting by Chen Lin and Yantoultra Ngui; Editing by Sumeet Chatterjee and Clarence Fernandez)
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