MAS revokes capital markets services licence of financial institution Apical Asset Management

MAS revokes capital markets services licence of financial institution Apical Asset Management

A view of the Monetary Authority of Singapore's headquarters in Singapore
A view of the Monetary Authority of Singapore's headquarters in Singapore on Jun 28, 2017. (Photo: REUTERS/Darren Whiteside/Files)

SINGAPORE: The Monetary Authority of Singapore (MAS) has revoked the capital markets services licence of Apical Asset Management (AAMPL) on Tuesday (Jul 28).

The revocation of the company's license is due to "serious breaches of MAS' anti-money laundering/countering financing of terrorism (AML/CFT) requirements", according to the authority's media release.

For a company to conduct financial activities under the Securities and Futures Act, it has to hold a capital markets services (CMS) licence. 

'SEVERE DEFICIENCIES'

The MAS said it uncovered "severe deficiencies" in the company’s AML/CFT controls from 2013 to 2018. The financial institution did not have the relevant basic policies and procedures in place which exposed it to the "risk of receiving and/or laundering the proceeds of crime". 

This risk was heightened with complex ownership structures, comprising multiple layers and investment entities used by some of the AAMPL's customers.

The MAS stated four breaches made by the company.

AAMPL did not conduct any enterprise-wide risk assessment, which is crucial to allow an entity to better understand its overall vulnerability to money laundering and terrorist financing risks. This assessment, which is conducted at least once every two years or when there are material trigger events, helps a company develop appropriate measures to address such risks.

The company did not properly assess its customers to determine whether they presented higher money laundering or terrorism financing risks.

AAMPL's ongoing monitoring controls and procedures were also found by MAS to be deficient, "resulting in its failure to conduct enhanced monitoring of a fund related to a politically exposed person for a significant length of time".

Lastly, AAMPL did not subject its AML/CFT controls to independent audits to assess their effectiveness.

CEO AND DIRECTOR REPRIMANDED

The MAS also reprimanded AAMPL's CEO and director Yeh Yin Yee and director Bernard Kan Cheok Yin for failing to discharge their duties and functions to ensure that the company complies with all laws and rules governing its operations.

Both Mr Yeh and Mr Kan were the only directors on AAMPL's board and were responsible for the management of its affairs, said the MAS.

The authority noted that the men have "failed to exercise sufficient oversight or take reasonable steps" to ensure the company put in place controls to detect and deter the flow of illicit funds through the financial system.

"MAS will not hesitate to take appropriate action against financial institutions whose policies and controls clearly fail to address the money laundering/terrorism financing risks in their business activities. Board and senior management who fall short in their duties will also be taken to task,” said Ms Loo Siew Yee, assistant managing director for policy, payments and financial crime at MAS. 

Source: CNA/ic(ta)

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