Proposed law to allow Singapore courts to order the sale of seized properties linked to criminal activities

SINGAPORE: Singapore courts would be allowed to order the sale of seized properties linked to suspected criminal activities under a new proposed law.

If passed, law enforcement agencies will be able to cut back on the cost of maintaining those properties as well as preserve their value to enhance subsequent asset recovery and restitution to victims, the Ministry of Home Affairs (MHA) said in a press release.

This is one of the amendments under the Anti-Money Laundering and Other Matters Bill tabled in parliament on Tuesday (Jul 2).

Currently, law enforcement agencies must get the consent of all involved parties if they want to obtain a court order to sell properties that are no longer required for investigations or court proceedings.

If there is no agreement among the parties, the agencies will have to continue to manage the property, said MHA. Authorities incur "significant" costs when maintaining certain types of properties such as vehicles, vessels and livestock, it added.

In a written response to a parliamentary question in May, Home Affairs and Law Minister K Shanmugam said the police have spent nearly S$650,000 (US$478,000) to maintain the assets seized or frozen in relation to Singapore’s largest money laundering case.

Expenses were incurred for the storage, maintenance and safeguarding of the assets, comprising properties, vehicles and luxury goods such as branded bags, watches and alcohol, said Mr Shanmugam, adding that the costs were "borne by the state".

Under the new Bill, the court can order for seized properties to be sold when the police or public prosecutor apply for a sale. 

On top of ordering the sale if all involved parties have given consent, the court may also do so if the value of the property is likely to depreciate or there are undue maintenance costs; or if the sale would be in the interest of justice.

At times, law enforcement agencies may also seize properties linked to suspects who have left the country. Investigations can be "wilfully stalled" if the absconded parties decide not to cooperate, said MHA. 

"The current processes for dealing with seized properties linked to absconded persons are unclear, and the CPC (Criminal Procedure Code) is silent on this issue," the ministry highlighted.

Under the proposed amendments, the court must not dispose of the properties if it is satisfied that there are ongoing investigations into the absconded person. 

The suspect will also be required to personally present himself or herself to the agencies for investigations before making a claim to the seized properties.

These amendments aimed at clarifying and improving the processes involved in dealing with seized properties will prevent the assets from being released prematurely while investigations are ongoing, said MHA.

They also help to avoid a situation where an absconded suspect evades investigations by staying out of Singapore and makes a successful claim to the seized properties, the ministry added. 

NO NEED FOR DIRECT LINK TO CRIMINAL CONDUCT

Under the Bill, there will also be no need to show that money allegedly laundered in Singapore is directly linked to specific criminal conduct.

It will be sufficient for the prosecution to prove "beyond reasonable doubt" that the money launderer knew or had reasonable grounds to believe that he was dealing with criminal proceeds, said MHA. 

This will allow money mules to be prosecuted in cases where the money laundered had passed through bank accounts and intermediaries overseas before entering Singapore.

At present, law enforcement agencies face challenges in obtaining the necessary evidence from foreign victims, entities and authorities, especially if the criminal proceeds had flowed through many jurisdictions before entering Singapore, MHA noted. 

The Bill introduced on Tuesday also sought to designate serious foreign environmental crimes as money laundering predicate offences. 

This will allow law enforcement agencies to investigate money laundering offences if they suspect that the money in Singapore came from such crimes committed overseas.

Separately, the amendments will allow government agencies such as the Inland Revenue Authority of Singapore and Singapore Customs to share tax and trade data respectively with the Suspicious Transaction Reporting Office - Singapore’s financial intelligence unit.

Anti-money laundering and finance terrorism regulators will also have access to the suspicious transaction reports filed by their regulated entities. 

Lastly, the Bill will also tighten rules for casino operators to carry out customer due diligence checks to detect and prevent money laundering, terrorism financing and proliferation financing. 

Proliferation financing involves providing funds or financial services for the illicit development and supply of weapons of mass destruction and related materials.

To align with the standards of the Financial Action Task Force - a global money laundering and terrorism financing watchdog - due diligence checks will have to be carried out when casinos receive a cash deposit of S$4,000 or more into a customer's account.

This is down from the current threshold of S$5,000. This marks the first revision to the threshold, and will be implemented this year.