Notice 626 on Prevention of Money Laundering and Countering the Financing of Terrorism

    Singapore

    Notice 626 on Prevention of Money Laundering and Countering the Financing of Terrorism

    Notice 626 on Prevention of Money Laundering and Countering the Financing of Terrorism (‘Notice 626’) issued by the Singapore Monetary Authority (SMA) establishes requirements for banks to put in place robust controls to detect and deter flow of illicit funds through Singapore’s financial system, especially with regards to anti-money laundering and counterterrorism financing (AML/CTF). 

    Last Updated: July 30, 2019


  • Requirements

    Notice 626 requires banks to exercise due diligence when dealing with customers, representatives of customers, beneficial owners of customers, and connected parties; to conduct business in conformity with high ethical standards, guard against establishing business relations that is or may be connected with money laundering or terrorism financing; and to fully cooperate with law enforcement authorities in Singapore for AML/CTF purposes. 

    In particular, Notice 626 includes the following conditions for banks regarding reliance on third parties: 

    • the bank is satisfied that the third party is subject to and supervised for compliance with AML/CTF standards set by the Financial Action Task Force and has adequate AML/CTF measures in place to comply with the same; 
    • the bank takes appropriate steps to assess the money laundering and counterterrorism financing risks in the jurisdictions the third party operates in;  
    • the MAS has not precluded banks from relying upon the third party; and 
    • the third party is able and willing to provide to the bank, information obtained by the third party on the measures applied on the bank’s customers which the bank would be required or want to obtain 

    In addition, in relation to AML/CTF, Notice 626 requires, among other things, banks to: 

    • conduct and document risk assessments, implement and monitor policies, procedures and controls to mitigate risks identified by the bank, MAS or other authorities; 
    • conduct customer due diligence, in cases where, among others, a business relationship is established with a customer, where there is a transaction exceeding SGD 20,000 (approx. €13,000) for any customer who has not otherwise established a relationship with the bank, and where there doubts about the veracity or adequacy of information obtained; 
    • conduct assessments of the AML/CTF regimes of correspondent banks; 
    • report suspicious transactions to the authorities; and 
    • develop internal policies, procedures and controls for its employees, with consideration of AML/CTF. 
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