Banks respond to NRA report on money-laundering, terrorist financing
- POSTED: 10 Jan 2014 23:15
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The Association of Banks in Singapore (ABS) said financial institutions are watchful of risks related to money laundering and terrorism financing, and they have robust standards and controls in place.
SINGAPORE: The Association of Banks in Singapore (ABS) said financial institutions are watchful of risks related to money laundering and terrorism financing, and they have robust standards and controls in place.
However, Samuel Tsien, chairman of ABS and group chief executive officer of OCBC Bank, said the growing complexity of money laundering activities will require financial institutions to invest "more resources in systems devoted to monitoring and tracking suspicious transactions, streamlining work processes to address risks in a timely manner".
He added there is also a need to continue to build bank-wide staff awareness and skill sets required to identifying and addressing such risks.
Mr Tsien also said financial institutions have to continue to act promptly on any gaps that are identified, further strengthening and improving existing control measures.
Some industry players also highlighted some challenges to tackle.
For example, DBS Bank said one area is in regulating a rising number of digital players who may not be banks, but are active in money transfers, from online payment companies to e-commerce sites.
Tan Su Shan, group head of consumer banking & wealth management at DBS, said: "These companies are not regulated in the same way as banks are, and a lot of these flows can be anonymised so there are potential policing challenges there."
Meanwhile, accounting firm KPMG Singapore believes virtual currencies and evolutions relating to Bitcoin will be a challenging area.
Lem Chin Kok, partner leading the AML and Sanctions Services at KPMG in Singapore, said: "Virtual currencies present similar risks to physical cash in terms of anonymity and the lack of audit trails around transactions."
Wilson Woo, financial services partner at EY, said: "People and systems will be the key challenges as the market continues to face a shortage of experience and knowledgeable talent."
Commenting on trust companies, Christina Choo, head of private trust at DBS Trustee, said trust companies carry out due diligence to determine whether the settlor has a legitimate purpose for setting up the trust structure, as well as verify the source of funds.
She also said controls are in place to monitor risks and report suspicious transactions promptly.