Association of Banks in Singapore Financial Crime Seminar 2021, "Deepening Partnerships to Combat Financial Crime" – Keynote Address by Mr Desmond Tan, Minister of State, Ministry of Home Affairs and Ministry of Sustainability and the Environment

Published: 08 July 2021

Chairman and Council Members of the Association of Banks in Singapore as well as Members and friends of the Banking Fraternity

I. Introduction

1.   I am very happy to join you today at this Financial Crime Seminar, and I know this is the 17th in this series. Let me begin by first thanking ABS for organising this year’s seminar, after taking a break last year due to COVID-19. This is an important platform, to me, for the industry to come together to exchange ideas on combatting financial crime.

2.   Pandemic or not, financial crimes and scams continue to evolve, and we need to up our game to protect our system and to maintain our reputation as a safe and trusted financial centre. Partnership between the Government and industry is therefore critical in our defence against financial crimes.

3.   Today, I would like to touch on two key areas of focus in the Home Team’s partnership efforts with ABS and members of the banking industry.

  1. First, is on combatting scams; and

  2. Second, enhancing our Anti Money Laundering (or AML) and Counter-Financing of Terrorism (or CFT) efforts, and this is in collaboration with the AML/CFT Industry Partnership (or ACIP) in short.

II.   Combatting Scams with IMCS

4.   First, on combatting scams. We continue to see a significant rise in the number of scams reported. In 2020, more than 15,000 cases of scams, involving around $200 million of losses, were reported to the Police. This is a 65% increase from 2019.

5.   I chair the Inter Ministry Committee on Scams (or IMCS in short), which coordinates the whole of Government’s anti-scam efforts. Since its inception last year, the Committee has worked closely with ABS anti-scam taskforce to implement a number of initiatives to prevent bank customers from falling prey to scams.

  1. For example, scammers often use various ruses to induce victims to share their OTPs, and to address this, ABS worked with the banks to include warning messages in their OTP SMSes. ABS is also working with banks to enhance the OTP verification processes through the use of Digital Tokens.

  2. IMCS and ABS also jointly rolled out a scam awareness quiz recently in May this year, to raise public literacy on scams and cyber hygiene. I was told more than 54,000 persons have already done this quiz, and we hope the momentum will continue in the months ahead.

  3. We are also working closely with banks to train frontline staff to spot and disrupt scams. Last year, frontline staff intercepted 76 scam cases involving about S$3 million in total. And the Police recognised the valuable contributions of over 100 staff from across 16 financial institutions at our Community Partnership Awards ceremony last month.

6.   To help those that fall prey to scams, we have also made good progress to help them recover losses.

  1. Project FRONTIER is one such initiative. This is a collaboration between the Police Anti-Scam Centre and more than 30 financial institutions, online marketplaces and telecommunication service providers to swiftly intercept illicit proceeds from scams, and to facilitate fund recovery to victims. Last year, more than S$57 million in scam proceeds were recovered.

  2. To keep online transactions and e-payments secure, MAS has set up a taskforce with representatives from banks and key payment players to review practices that the financial industry can put in place to better protect consumers against scams and fraudulent transactions. This review will aim to provide fair, clear and consistent approaches for liability apportionment for fraudulent e-payment transactions.

7.   Money mules are an essential part of the modus operandi of scammers. Police are intensifying efforts to educate the industry and consumers on money mule activities so that they can help us disrupt this activity. And we do this in two ways.

  1. First, we inform our banks regularly on the latest typologies for both individual and corporate money mules, so that they can better intervene in such transactions. Last year, we sent out three advisories to alert banks.

  2. Secondly, some banks have gone one step ahead to introduce a Police advisory as part of the bank account opening process. This helps to warn customers against facilitating money laundering offences with their personal bank accounts. It is a simple step to take to better protect your customers, and I would like to encourage all present today to consider including this Police advisory as part of your customer onboarding process. 

III.   Enhancing AML/CFT Efforts with ACIP

8.   The second area of focus will be on our AML/CFT, and counter-Proliferation Financing efforts.

9.   The ACIP has served as an important platform for MAS, the Commercial Affairs Department (CAD) and the industry to collectively address money laundering, terrorism financing and proliferation financing risks in two main ways.

  1. First, ACIP has increased industry-wide understanding of these risks, strengthening our collective ability to detect and deter related crimes. Through bite-sized advisories and best practice papers, we hope to keep the industry updated on emerging typologies, accompanying risk indicators and appropriate mitigation measures.

  2. Second, ACIP also facilitates sharing of intelligence on cases. Last year, such sharing helped to intercept $69 million in illegal proceeds from an extensive shell company network, including $19 million in fund transfers blocked through proactive identification of suspicious accounts.

10.   Our 2020 National Risk Assessment on Terrorism Financing highlighted that regional as well as international terrorist groups may target individuals in Singapore, to radicalise and influence them to carry out terrorism financing activities. In particular, we found that remittance companies and banks are more vulnerable to being misused for terrorism financing. And to address this threat, we established the ACIP CFT Operational Group last year as a dedicated platform for Police and banks to collaborate on investigations and share information on Counter-Financing of Terrorism related trends. Other partners such as academics have also been invited to share insights at this platform.

11.   Having completed the National Risk Assessment on Terrorism Financing last year, we are now focusing on our National Risk Assessment on Proliferation Financing this year. This is a key risk area, as shown by the local prosecutions of several individuals in 2019 for breaches of international sanctions on the Democratic People’s Republic of Korea. We will work with ACIP and financial institutions to gather valuable industry perspectives to support the National Risk Assessment on Proliferation Financing this year.

12.   The ACIP has been a valuable and effective platform for MAS, CAD and the industry to work together. And as ACIP turns five next year, I am happy to note that they are already planning for the next bound. They are planning efforts to more quickly and comprehensively inform industry partners of the latest best practices and threat typologies, including those outside ACIP. ACIP is also planning to establish a new working group for Government and industry to monitor emerging risk areas, and looking at more ways to support the industry’s efforts to enhance its data analytics capabilities.

13.   But we know the ACIP cannot do all this alone. And I hope all industry members here today can step forward and contribute to ACIP where possible, so that we can collectively better protect ourselves from financial crime.

14.   The Government will do our part. For example, the Government is taking into account feedback from industry and considering all options to combat money laundering, including reviewing of legislation to ensure that our laws continue to remain effective in the current operating landscape.

IV.   Conclusion

15.   To conclude, I would like to extend our heartfelt thanks to ABS and to our partner banks for the close collaboration and the tremendous support for our many joint initiatives. We will continue to work in close partnership with you to effectively deal with the challenges of financial crime, and keep Singapore’s financial sector safe and secure.

16.   I wish you all a fruitful discussion ahead. Thank you.